New Rulings on Delay of Payment Penalties in Washington

In re: James Coston, Dckt. No. 11 12310 (Sept. 11, 2012)

Self-insured employers should be aware that delay in payment of medical bills could now result in a penalty order.  The Board of Industrial Insurance Appeals in In re: James Coston ruled that payment of medical bills is a benefit to the worker within the meaning of the penalty statute RCW 51.48.017.  An alleged unreasonable delay in payment of medical bills related to a claim can leave the employer exposed to a penalty.  However, there may be situations where legal or medical doubt about entitlement to benefits is a potential defense to payment of medical bills under a claim.

In re: Emily J. Eyrich, Dckt. No. 11 22230 (Jan. 2, 2013)

Self-insured employers should be aware that a delay in payment of a penalty issued for delay in payment of time loss benefits can result in a second penalty order against the employer.  The Board of Industrial Insurance Appeals in In re: Emily J. Eyrich ruled that penalties awarded to claimant against the self insured employer for unreasonable delay of time loss payments are considered a “benefit” to a worker within the meaning of the penalty statute RCW 51.48.017.  A delay in payment of the penalty can leave the employer exposed to additional penalties.  The Board indicated that 45 days (six weeks) delay constitutes an unreasonable delay as the Department order awarding benefits was effective and benefits due on the date issued.  It is arguable as to whether penalties for other situations such as for late production of claim file documents or delayed action on a claim that does not involve time loss would be considered as “benefits” under this decision.  There also may be situations where legal or medical doubt about entitlement to benefits is a potential defense to payment of an order directing an employer to pay benefits.

If you need assistance with determining whether to pay medical bills under a claim, or with a penalty order, please feel free to contact any of our Washington practice attorneys to walk you through this new development in workers’ compensation law and how it applies to your specific claim.