February 7, 2023 Article

Maine Workers’ Compensation New Year Update 2023

Maine Workers' Comp Alert

The new year brings proposed legislation, an update to the Medical Fee Schedule, and two recent decisions from the Appellate Division.

Proposed Legislation

Workers’ compensation bill LD 53 (HP 28) would amend 39-A M.R.S.A. 104 to remove intentional acts and omissions from the exemptions from civil action related to damages sustained by an employee when an employer has secured payment of workers' compensation. The Bill was referred to the Committee on Labor and Housing. We will monitor this proposed legislation and provide updates as they become available.

Medical Fee Schedule Update–Effective 1/1/2023

In accordance with 39-A M.R.S.A. Section 209-A, the Professional / Appendix II and Outpatient Facility / Appendix IV fee schedules have been updated for dates of service on or after January 1, 2023. The updated versions of Appendix II and IV are available here.

Appellate Division Decisions

Dominguez v. Pyramid Fore Street Management (Case No. App. Div. 22-0005 Decision No. 23-03 [January 13, 2023]). The Appellate Division vacated an ALJ decision denying a claim for benefits based on the employer and insurer’s after-the-fact, unilateral discontinuance pursuant to 39-A M.R.S.A. § 205(9)(A).

In that case, Pyramid unilaterally and immediately discontinued Ms. Dominguez’s benefits with a filing on September 25, 2019, when Ms. Dominguez was out of work. Pyramid’s filing stated it was retroactive to August 6, 2019, a time when Ms. Dominguez was still working and her medical provider had not yet indicated she was free of restrictions.

The employer, insurer, or group self-insurer may discontinue or reduce benefits under section 205(9)(A) “[i]f the employee has returned to work with or has received an increase in pay from an employer that is paying compensation under this Act, that employer or that employer’s insurer or group self-insurer may discontinue or reduce payments to the employee.” By Rule, the Board has clarified that such a discontinuance may occur when: (A) The employee returns to work without restrictions or limitations, due to the injury for which benefits are being paid, according to the employee’s treating health care providers; and (B) There are no conflicting medical records with respect to the lack of restrictions or limitations due to the injury for which benefits are being paid. (Me. W.C.B. Rule, Ch. 8, § 11)

The Appellate Division found the discontinuance was procedurally improper because the “no restrictions” medical opinion was issued on September 5, 2019 (after the fact), and lists an effective date of August 6, 2019. The Appellate Division rejected the ALJ’s treatment of this issue as a form filing error and vacated the decision in part for further findings.

Takeaway: When an employee returns to work for the pre-injury employer paying compensation, a discontinuance must be based on contemporaneous medical evidence.

Richard Pratt v. S.D. Warren Co (App. Div. Case No. 22-0001 [January 3, 2023]) addressed the amount of the offset available for Social Security Retirement benefits received. Under section 221(3)(A) of the Act, the employer and insurer are generally entitled to offset 50% of the social security benefit ultimately received. Under section 221(3)(B), there is no credit or reduction allowed because of an increased granted by the Social Security Administration as a cost of living adjustment granted after benefits are coordinated.

In Pratt, after the employee began receiving his benefits at age 70 (increased by cost of living adjustments and separate delayed retirement credits), the Employer offset 50% of the benefit the employee ultimately received. The Appellate Division ruled that the 2017 Decree’s statement that the Employer would be entitled to a Social Security Retirement offset based on the “benefit ultimately received” was inconsistent with section 221’s disallowance of coordination of cost of living increases granted after benefits are coordinated. Further, because the Employer coordinated benefits for one month at age 66, before the Employee deferred his Social Security retirement, the Employer is not allowed to offset the cost of living increases that applied during the four years while the Employee was not receiving Social Security Retirement benefits.

Takeaway: Where an employee receives Social Security Retirement benefits for a brief period and then defers such benefits until a later age, when such benefits resume the Employer and Insurer are only entitled to offset the initial Social Security Retirement payment, not the subsequent amount received by the employee which factors in cost of living adjustments.