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Havanis v. Calif. Dept. of Transportation (Board Panel Decision)
By Hon. Colleen Casey, Former Commissioner, California Workers’ Compensation Appeals Board
I. Medical apportionment is not the same as VR apportionment
Medical apportionment is a totally different concept from vocational apportionment. In sports terms, medical apportionment would be football, and vocational apportionment would be cricket. Football is played all the time and everywhere, whereas cricket, not so much. The playing fields are different. The equipment is different. And the results are totally different. Same goes for Medical apportionment and Vocational apportionment.
Although vocational rehabilitation (VR) experts still have a role to play, the 2023 WCAB en banc decisions of Nunes made it clear that, “VR apportionment” by VR experts is no longer permitted. (See Nunes v State of California, DMV (2023) 88 Cal. Comp. Cases 741 Nunes I; and Nunes v State of California, DMV (2023) 88 Cal. Comp. Cases 894 Nunes II;) However, the WCAB just issued a Noteworthy Panel Decision (NPD), Havanis v. California Department of Transportation, 2024 Cal. Wrk. Comp. P.D. LEXIS 167, which explains exactly how to validly incorporate vocational analysis for a winning result (as discussed below.)
A. What is “non-viable VR apportionment”?
Non-viable VR apportionment occurs when the VR expert concludes that medical apportionment should not reduce a 100% permanent and total disability (PTD) determination based on vocational analysis, such as in an Ogilvie rebuttal of a strict rating of PD. (See Nunes supra and the 1st DCA case of Ogilvie v. WCAB (2011) 76 Cal. Comp. Cases 624.)
If the VR expert can’t make this determination, who can?
Per LC §4663, only physicians are allowed to offer an opinion as to whether medical apportionment applies in any given situation. Therefore, it is perfectly valid for a medical expert to make that same determination as a VR expert might make, using data obtained from VR experts, but VR experts are now barred from doing so.
B. Nunes decision set the boundaries
In the Nunes cases, the VR expert determined that applicant was 100% permanently totally disabled (PTD) based on a vocational analysis. He reasoned that her industrial injury caused her not to be amenable to retraining and thus rendered her with a 0% future earning capacity. The VR expert opined applicant’s 100% PTD award based on a vocational analysis should not be reduced by medical apportionment to non-industrial factors. He explained that those non-industrial factors existed prior to applicant’s industrial injury of 9/13/2011 and yet she was still “capable of performing her usual and customary work with zero impediment until the injury.” The VR expert didn’t understand why her 100% PTD award should be reduced by apportionment to “before the injury” factors if they played no role in her disability.
The logic behind the VR’s opinion makes sense. In fact, the Nunes court left the door open for applicant to be granted an “un-apportioned award” by stating, “we observe that an un-apportioned award may be appropriate where it can be established through competent medical and/or vocational evidence that the current industrial injury is the sole causative factor for the employee’s residual permanent disability.” (Emphasis added.)
So how could the VR expert’s conclusion be considered “non-viable?”
Because it was the VR expert who made that determination of 100% PTD excluding the medical apportionment. If it had been the medical evaluator who had reviewed the report of the VR expert and who had determined that applicant was 100% PTD on a vocational basis due solely to this new industrial injury of 9/13/2011, that opinion might well have been considered “substantial medical evidence” upon which a judge could rely. (Of course, the physician’s opinion would also have to include a “how & why” analysis consistent with the requirements of a valid apportionment findings in Escobedo v. Marshalls (2005) 70 Cal. Comp. Cases 604.)
The Nunes court held as follows:
“1. Section 4663 required a reporting physician to make an apportionment determination and prescribes the standard for apportionment. The Labor Code makes no statutory provision for ‘vocational apportionment.’
2. Vocational evidence may be used to address issues relevant to the determination of permanent disability.
3. Vocational evidence must address apportionment and may not substitute impermissible ‘vocational apportionment’ in place of otherwise valid medical apportionment.”
(Find this quote in case of Braaten v. Lloyd W. Aubry Co., Inc., 2024 Cal. Wrk. Comp. P.D. LEXIS 81.)
C. Medical analysis is different from vocational analysis
The Nunes court clarified that there are two ways to analyze apportionment, both of which are viable only when performed by a medical expert as follows:
(1) Medical Analysis: In most cases, the PD calculation is based on numerical values derived from descriptions and measurements set forth in the AMA Guides 5th Edition pursuant to Labor Code Sections 4660 and 4660,1. Once the level of PD is determined, per LC 4663, the physician, and only the physician, is then mandated to apply medical apportionment (regardless of whether those factors manifested in pathology, asymptomatic prior conditions, etc.).
(2) Vocational Analysis: However, in other cases, the ultimate determination of PD is not based on numerical values from the AMA Guides, but from a vocational analysis, such as when an applicant is successful with an Ogilvie rebuttal, resulting in 100% PTD. In those cases, the physician must determine causative industrial factors versus non-industrial causation factors of the 100% PTD result. (Those factors may be manifested in diminished earnings, work restrictions, or an inability to perform job duties.)
It is critical for attorneys to understand the difference between these two types of analyses so that they can work up accurate and viable evidence to present to the judge at trial, depending upon which analysis is applicable to their given set of facts.
Most attorneys are clear as to how medical apportionment works. However, confusion sets in when the PD calculation is based on a vocational analysis. This would occur in situations such as an Ogilvie rebuttal. The problem is, many practitioners are unclear as to how apportionment is applied when based on a vocational, rather than a medical foundation.
II. What is the roadmap for vocational analysis?
A. “Loss of earning capacity” is the key to the Ogilvie case
First, the WCAB explored the basis of the Ogilvie case which created the need for the concept of vocational analysis. In that case, the DCA explained that “loss of future earning capacity” is one of the three ways that a strict PD rating may be rebutted.
According to the WCAB the “focus of apportionment changes when using an Ogilvie rebuttal because the defined impairment changes.”
The WCAB goes on to explain the five steps in their thought process for this pronouncement:
B. Whose burden is it anyway?
Therefore, applicant attorneys have the burden of proof on this issue. They must prove that the industrial injury is the sole causative factor for the worker’s 100% PTD. If applicant fails in this burden, the 100% PTD Ogilvie rebuttal award will be reduced by the percentage of non-industrial causation.
Therefore, it is in the interest of the defense to offer up evidence that establishes how both industrial factors, as well as non-industrial factors, play a causative role in applicant’s 100% PTD, and that the industrial injury is NOT the sole cause of applicant’s 100% PTD.
So, how do we get there? How do the parties obtain the information necessary to prove their respective burdens in cases where vocational analysis plays a key role?
Fortunately, on 5/3/2024, the WCAB issued a Noteworthy Panel Decision (NPD), Havanis v. California Department of Transportation, 2024 Cal. Wrk. Comp. P.D. LEXIS 167, that gives us a plan to follow when developing the record on this issue. Set forth below is a four-step guide to use in order to establish a 100% PTD Ogilvie rebuttal award (without a deduction for medical apportionment). Turns out, it all revolves around applicant’s work restrictions.
“1) Applicant has been assigned a work restriction(s), which requires substantial medical evidence.
2) The work restriction(s) precludes applicant from rehabilitation into another career field, which requires vocational expert evidence.
3) The work restriction(s) precludes applicant from competing on the open labor market, which requires vocational expert evidence.
4) The cause of the work restriction(s) is 100% industrial, which requires substantial medical evidence.” (emphasis in original)
The WCAB explained their rationale as follows:
“To be clear, we are focused only on those restrictions that contribute to the vocational expert's findings. An applicant can have multiple work restrictions, some of which are non-industrial. If the industrial work restrictions, standing alone, preclude applicant from rehabilitation and preclude applicant from competing on the open labor market, applicant has met their burden on causation of disability. If applicant's preclusion from rehabilitation and work is caused or contributed by either non-industrial work restrictions or partially industrial work restrictions, applicant fails their burden on causation of disability.”
C. WCAB gives applicant second bite of the apple
The court determined in this particular case that applicant had failed their burden of proof on the issue of whether applicant’s 100% PTD should not be reduced by medical apportionment. However, the WCAB explained why they were giving applicant a second bite of the apple as follows:
“Here, applicant failed to prove that the work restrictions assigned are 100% industrial because no party asked that question to any of the doctors. This requires medical evidence. As we are clarifying this issue for the first time and keeping with our duty to accomplish substantial justice, the prudent course is to return this matter to the trial level for further discovery.”
III. Takeaways from NPD of Havanis
A. What is the VR expert’s responsibility when applicant is arguing an Ogilvie rebuttal?
The VR expert should comment and explain how and why applicant’s 100% loss of earning capacity is 100% due to the industrial injury and is 0% due to non-industrial factors. (For instance, what if applicant’s 100% loss of earning capacity was due to a failed industrial spinal surgery which resulted in work restrictions that standing alone without regard to any other impairment(s) would cause applicant to be 100% PTD? These facts and the vocational argument used was successful in the pre-Nunes case of Bagobri v. AC Transit, 2019 Cal. Wrk. Comp. P.D. LEXIS 384 (Appeals Board noteworthy panel decision).)
On the other hand, if the VR expert determines that there are non-industrial or prior industrial causes/awards which are partially responsible for a 100% loss of earning capacity, the VR expert should identify each of the causal non-industrial factors that are specifically related to applicant’s 100% loss of earning capacity.
B. What is the medical expert’s responsibility when applicant is arguing an Ogilvie rebuttal?
It is up to the medical evaluator to review the opinion or opinions of the VR expert(s) and make one of two determinations:
IV. Conclusion
Hopefully the WCAB’s new paradigm for calculation of 100% PD cases that are based on vocational evidence will assist practitioners in developing the record for trial. Although the WCAB was gracious in granting the applicant another bite of the apple in this case, they may not be so lenient in the future. The wise litigator will incorporate this new paradigm into their existing trial prep checklist.
NPDs with similar facts and holdings:
For additional insight on this issue, see Hon. Marguerite Sweeney, Former Commissioner, California Workers’ Compensation Appeals Board’s LEXIS article of 8/16/2023 entitled, “California: Nunes and the Path Forward: The Use of Vocational Evidence in Determining Permanent Disability and Apportionment.”
Reminder: Board panel decisions are not binding precedent.
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