COVID-19: Indirect impacts on existing Oregon claims

Vincci W. Lam

The implications of the novel coronavirus (“COVID-19”) pandemic is permeating daily life on an increasingly greater scale. An earlier Reinisch Wilson Weier blog (linked here) discussed the relevant legal analysis if you receive a claim for COVID-19, as a work-related condition. What about impact of COVID-19 on active claims in an indirect fashion? Below are some of the most common questions we have heard from clients (as of this publication date), which may apply to one or more of your claims as well.

Temporary disability benefits

Many employers (primarily those in the retail, hospitality, and service industries) have suspended operations due to COVID-19, either as an internal decision or due to a government mandate. Many of these workplaces likely included workers who were earning wages performing light duty in lieu of receiving time loss benefits under the claim. You may soon see questions from claimants, whose workplaces have closed, regarding resumption of temporary disability benefits under an open/accepted claim because he/she is no longer able to earn wages in light duty given their work site has closed. It is likely time loss benefits will need to resume in those claims, pursuant to OAR 436-060-0030(6) and applicable analogous case law:

OAR 436-060-0030 Payment of Temporary Partial Disability Compensation

(6) If the modified job no longer exists or offer is withdrawn, temporary partial disability must be paid at the full temporary total disability rate as of the date a modified job no longer exists or the job offer is withdrawn by the employer.

(a)  This section applies to situations including, but not limited to, termination of temporary employment, layoff, or plant closure.

In a related Oregon Workers’ Compensation Board decision William K. Bowler,[1] claimant was earning regular wages performing light duty, when the employer’s plant shut down. (The cause for the shut down was not specified.) The Board found closure of the plant was a withdrawal of modified work and claimant was entitled to time loss benefits.

In Kati Hanks,[2] the Board ruled “in the present claim, the employer’s withdrawal of an offer of modified employment is equally clear. By locking claimant out of the workplace, the employer effectively, even if only temporarily, withdrew modified employment from the claimant. Claimant could not voluntarily choose to participate in the employment, neither is she able to return to her regular employment for another employer because of the disabling effects of her compensable injury.”[3]

The Board found that the plant closure in Bowler and the lockout in Hanks amounted to a withdrawal of light duty work, preventing claimant from earning wages in light duty. The Board found that time loss benefits were therefore owed. It should be particularly noted that the Board in Hanks wrote: “…neither is she able to return to her regular employment for another employer because of the disabling effects of her compensable injury.” The logic is that, due to the compensable injury, claimant cannot earn wages at the employer-at-injury due to the job site closing, and the worker also cannot go work elsewhere due to the physical limitations flowing from the work injury. The potential of increased time loss resulting from COVID closures (particularly in the dining and service industries) is frustrating, given employers are not choosing to close and are instead ordered to do so by government mandate. Despite the frustrating outcome, the cause for closure of the work site likely would not be compelling enough to override the rules and cases cited above.

Independent medical examination (IME) attendance

Under Oregon law, a worker risks a suspension of benefits if he/she fails to attend an IME. However, benefit suspensions are not granted lightly by the Oregon Workers’ Compensation Division (WCD). The administrative rules imply that failure to attend will not result in a suspension of benefits if claimant has “good reason” for the failure to attend.[4] The WCD would likely find claimant had good cause not to attend an IME given the precautions and social-distancing created by COVID-19. That said, whether claimant had good cause for failing to attend the IME would be analyzed on a case by case basis (e.g. was worker attending other events or appointments despite COVID-19).

Furthermore, a number of IME physicians are actually cancelling exams due to concerns for his/her own health and safety. If an in-person IME is not available, a records review should be strongly considered as an alternative means to investigate compensability of the injury, condition or surgery at issue within the time constraints of claim processing. Documenting attempts to reschedule an IME or obtaining a records review is important. If a judge ultimately overturns a denial, he/she may also need to conduct a secondary inquiry as to whether the denial was issued reasonably, in determining whether to impose a penalty associated with an unreasonable denial. In other words, if a worker fails to attend an IME, or the IME is cancelled by the physician due to COVID-19 concerns, ultimately resulting in a denial, the judge will still ask whether reasonable steps were taken to investigate the claim/condition to the best of one’s ability before the denial was issued.

Administrative closure after a bug letter or failure to attend a mandatory closing exam

A claim may be closed administratively when a worker fails to seek treatment for 30 days and then fails to respond to a “bug letter.”[5] A claim may be closed administratively when the worker fails to attend a closing exam (assuming proper notification was given to the worker).[6] Under both of these administrative closure scenarios, a worker can avoid claim closure by showing that the failure to treat/respond to the bug letter or failure to attend the closing exam was due to reasons “beyond the worker’s control.” Given the widespread precautionary measures and social-distancing recommended under COVID-19, the WCD could find that the failure to treat or attend a closing exam was proper. Again, this would be assessed on a case-by-case basis, depending on the ability of the worker to attend other similarly-important appointments.

Elective surgeries

Many state and local municipalities, or medical facilities themselves, have put a halt on elective surgeries. This is presumably to avoid exposing additional individuals to the virus while in the medical facility for the elective surgery, and to preserve capacity at healthcare facilities for COVID-related treatment. If postponement or rescheduling of elective surgeries becomes a widespread practice, we will see significant delays in elective surgeries necessitated by a work injury claim. This will result in potentially prolonged time loss benefits as well as an increase in conservative care costs. In these circumstances, a greater emphasis on identifying and offering any available light duty work will be helpful to mitigate claim costs.

These are just a few of the most common scenarios our clients have brought to our attention. Please feel free to reach out to the attorneys at Reinisch Wilson Weier PC if you have a specific concern not addressed here or a specific circumstance where we may be of assistance.

See also our earlier blogs,Oregon claim processing implications for COVID-19 andCoronavirus and Washington workers’ compensation.

[1] William K. Bowler, 48 Van Natta 74 (1996).

[2] Kati Hanks, 44 Van Natta 881 (1992).

[3] See also Safeway Stores, Inc. v. Hanks, 122 Or App 582 (1993).

[4] OAR 436-060-0095(3)(d)(I) and OAR 436-060-0095(6)(f).

[5] OAR 436-030-0034(1).

[6] OAR 436-030-0034(3).