Federal: No Bad-Faith Denial of Benefits Where Insurer Refused to Pay for Worker’s Groceries and Cable TV

The 8th Circuit Court of Appeals affirmed an order granting a workers’ compensation insurer summary judgment in an action originally filed in Iowa state court alleging the insurer had exercised bad faith in failing to pay an injured worker’s medical expenses, which because of unusual circumstances, claimed the worker, should include groceries and cable television. Plaintiff was an undocumented worker who sustained severe injuries that rendered him a paraplegic. His rehab center refused to discharge him to any housing that did not meet his medical needs. Unfortunately, because of his illegal status, he did not qualify for federal or state assistance and could not afford modified housing on the $400 per week he received in workers’ compensation disability benefits. The Commission ordered the insurer to pay the worker’s living expenses—including groceries and cable TV—until such time as he could be discharged to appropriate housing. The plaintiff filed the bad faith action for the insurer’s earlier refusal to do so on its own. The 8th Circuit agreed that there was no basis for a bad faith action; it was not readily apparent that such living expenses were similar to the medical services and supplies listed in Iowa Code § 85.27 or to the appliances found to be compensable in the Iowa Supreme Court cases. For additional discussion, see http://www.workcompwriter.com/8th-circuit-insurers-refusal-to-pay-for-injured-undocumented-workers-groceries-and-cable-tv-not-bad-faith-denial-of-insurance-benefits/

Thomas A. Robinson, J.D., the Feature National Columnist for the LexisNexis Workers’ Compensation eNewsletter, is a leading commentator and expert on the law of workers’ compensation.

LexisNexis Online Subscribers: Citations below link to Lexis Advance. Bracketed citations link to lexis.com.

See Paulino v. Chartis Claims, Inc., 2014 U.S. App. LEXIS 23964 (Dec. 19, 2014) [2014 U.S. App. LEXIS 23964 (Dec. 19, 2014)]

See generally Larson’s Workers’ Compensation Law, § 104.05 [104.05]

Source: Larson’s Workers’ Compensation Law, the nation’s leading authority on workers’ compensation law