Almaraz/Guzman II and Ogilvie II - Synopses and Commentary

Almaraz/Guzman II and Ogilvie II - Synopses and Commentary

Almaraz v. Environmental Recovery Services; Joyce Guzman v. Milpitas Unified School District, ADJ 1078163/ADJ 3341185 (Almaraz/Guzman II)(September 3, 2009)

In a joint en banc decision, after reconsideration, the WCAB has modified their original 2/3/09 to now hold that (1) the 2005 permanent disability rating schedule is rebuttable; (2) the burden of rebutting the schedule is on the party disputing the rating; (3) one method of rebutting the schedules is to challenge one of the components of the schedule, i.e. a workers’ whole person impairment (WPI) under the AMA Guides; (4) when determining the worker’s WPI, is not permissible to go outside of the AMA Guides, but the physician may use any chapter, table or method in the AMA Guides which “most accurately reflects the injured  employee’s impairment.”

One significant difference in the new holding is that the WCAB is rejecting the use of any materials outside of the AMA Guides as the basis for rebutting the 2005 Schedule.  Whereas their 2/3/09 decision allowed for the use of other guides, treaties, publications to rebut the schedule, including medical and non-medical information on whether the injury impairs the performance of a job, and opinions from vocational specialists, the WCAB has now concluded that the only way to rebut the schedule is to utilize the AMA Guides themselves.  A physician is now encouraged to use any chapter, table or method within the AMA Guides to assess the worker’s impairment in rebutting the WPI.  The WCAB believes this is most consistent with the mandate of Labor Code, Section 4660(d) that the schedule is to promote “consistency, uniformity and objectivity.”

Another difference is the rejection of the previously established standard of, “inequitable, disproportionate, and not a fair and accurate measure of the employee’s permanent disability”.  The WCAB firmly rejected the prior standard in favor of what appears to be a new standard; that a physician is allowed to use any chapter, table or method of the AMA which “most accurately reflects the injured employee’s impairment.”  Despite this allowance, a physician is not allowed to arbitrarily assess an injured employee’s impairment.  The physician is still required to provide a clear, accurate and complete report as required by the AMA Guides, and their opinion on the WPI must constitute substantial evidence upon which the WCAB may rely.

Lastly, the WCAB outlines the procedure in disputing an injured employee’s WPI.  Such dispute is a question of fact to be determined by a WCALJ, and it is the WCAB, not any particular physician, that is the ultimate trier-of-fact on medical issues.  After a treating physician or medical legal evaluator issues an opinion on the WPI, either the worker or defendant may seek to challenge that opinion through rebuttal evidence.  Typically, and to reduce costs and expedite proceedings, the rebuttal evidence will consist of either a supplemental report, or the cross examination of a physician.  However, in some circumstances, rebuttal evidence will come from a report from another physician, as allowed by the Labor Code.  The WCAB encourages the parties to do so prior to the MSC, and not wait until after trial, although in some circumstances, post MSC rebuttal evidence may be allowed.

Ogilvie v. City and County of San Francisco ADJ 1177048, 9/3/09 (Ogilvie II)

Ogilvie II is essentially a “road map” explaining how to rebut the standard DFEC calculations outlined in the 2005 schedule.  The WCAB instructs that a party must first obtain the applicant’s wage data and the wage data of “similarly situated employees”.  Second, the party determines what percentage of the applicant’s earning capacity he or she has lost.  Third, the applicant compares the percentage of lost wages to the percentage the applicant’s Whole Person Impairment (as found by an AME, PQME or treating physician) and obtains a ratio.  Finally, the party compares that ratio to the 2005 schedule’s DFEC table, and either uses the table in the schedule, or uses a formula to find the new DFEC adjustment factor.  This “new adjustment factor” will in many cases, especially those where the applicant has relatively low whole person impairment and has lost most or all of his or her ability to earn wages, greatly increase the applicant’s Permanent Disability.

Ogilvie II offers defendants a few tools to contest the increase of PD.  The decision recognizes that “it may be difficult” for a judge to assess an applicant’s actual earning capacity in a case in which the applicant has been Temporarily Totally Disabled from the applicant’s date of injury until shortly before the P&S report upon which a case is being settled.  Under those circumstances, the standard 2005 schedule DFEC adjustment factor can be used initially, then, should the applicant fail to return to the workforce, the applicant may file a petition to reopen challenging the original adjustment factor.  This, and other portions of the Ogilvie II decision give the defense certain angles of attack on PD claims based on Ogilvie II.

Unfortunately, Ogilvie II leaves critical questions unanswered, and creates potential areas of significant liability.  The decision fails to address with specificity the question of how a claim in which an applicant has multiple small disabilities should be rated.  It seems vastly inequitable that an individual with five 2% WPI ratings and 100% loss of earning capacity should receive about 66% PD (after adding a large “Ogilvie” adjustment to each WPI) while an individual with only one 10% WPI rating and 100% loss of earning capacity should only approximately 28% PD, but that is one possible argument that we will have to address.

Ogilvie II has the potential to affect nearly every post SB899 case.  The WCAB has provided a tool by which any applicant can argue for increased PD if he or she does not return to work after an industrial injury or returns to work for a lower wage than the wage he or she would have earned had the injury not occurred.  GMK is dedicated to ensuring that every applicant receives only the amount of Permanent Disability to which he or she is entitled, and plans to vigorously contest any legally or factually insufficient argument to increase that disability.

© Copyright 2009 by Goldman, Magdalin & Krikes, LLP. All rights reserved. Reprinted with permission.