Can The Workers’ Comp Insurance Company Just Stop Paying Me?
A frequently asked question from workers’ compensation clients is if the workers’ compensation insurance carrier can simply stop paying them if they so choose. The answer to that question is an emphatic no. Once workers’ compensation benefits are being paid, the insurance company has limited ways to stop such a benefit.
If an injury occurs at work the employer and its insurance carrier have essentially three different options. It must choose one of these options within 21 days or else be subject to potential penalties for not either accepting or denying the claim within the statutory 21-day time period. First, the employer could deny the claim based on whatever reason it deems valid. For example, if the carrier doesn’t believe that the injury is work-related it can deny the claim based on that reason alone. Second, the insurance carrier and its employer can accept the claim in its entirety by issuing a document called a Notice of Compensation Payable. This means that the injured worker will be entitled to medical benefits and potentially wage loss benefits. And a third option is the insurance carrier may issue what is called a Temporary Notice of Compensation Payable and accept the claim on a 90-day trial basis. This third method has become the norm in the Pennsylvania workers’ compensation industry. In other words, insurance carriers commonly accept claims on a temporary basis despite the fact that the injury is quite obviously work-related. This gives the carrier 90 days to essentially change its mind for nearly any reason. However, if the carrier changes its mind for what is deemed later to be an unreasonable reason, it may be subject to what are called unreasonable contest fees and penalties.
As the title of this article suggests, the important question is – once workers’ compensation benefits are started (and after the 90-day period under a Temporary Notice of Compensation Payable), can the insurance carrier simply stop paying? As stated above, the answer is “no.” However, there are some methods open to the carrier to try to either limit those benefits or stop them altogether. The purpose of this article is to go through the various ways this can be done.
First, if the injured employee (or, “Claimant”) goes back to work making the same or more wages as before being injured, the insurance carrier can issue what is called a Suspension Notice under Section 413. This is a notarized document which is the only way that the insurance carrier can stop paying wage loss benefits without taking the Claimant to court via some petition. The 413 Suspension Notice essentially is a sworn document where the adjuster states that he or she has firsthand knowledge that the Claimant has returned to work at the same or more wages that the Claimant was making when injured. Once this document is filed wage loss checks will stop unless the injured worker files an Employee Challenge, essentially an appeal to the suspension. That appeal must be taken within 21 days of the suspension being filed. Aside from the 413 Suspension Notice however, the insurance carrier cannot stop paying wage loss or medical benefits without filing some type of petition and taking the Claimant to court. This is a very important fact to know since many Claimants fear that their benefits could be stopped for nearly any reason. It is simply not that easy for the insurance carrier.
The second way the insurance carrier can stop paying benefits is to file what is called a Termination Petition. This petition is essentially saying to a Judge that the insurance carrier has evidence that the employee has fully recovered from the work injury and can return to work without any restrictions. To file this petition the insurance company must get evidence by way of either the treating physician’s own notes or the opinion of an Independent Medical Examiner (an “IME” doctor). The insurance company has the right to send a Claimant to an independent doctor twice a year. If this independent doctor finds that the Claimant is fully recovered, the insurance company can file a Petition to Terminate. A Termination Petition takes nearly 10 months to litigate, after which time a Judge will make a determination as to whether he or she believes that the Claimant is fully recovered.
The third way that the insurance carrier can stop paying Pennsylvania workers’ comp benefits would be to file a Suspension Petition based on a job offer. This is simply the process of proving to a Judge that the employer has offered some type of work that the Claimant has been cleared for and the Claimant has not made a good-faith effort to follow up with that offer. In other words, if the Claimant is released to light-duty work by an Independent Medical Examiner, the employer has the ability to offer light-duty work to the Claimant. If the Claimant refuses to try the job offered, the insurance company can file a Petition to Suspend the wage loss portion of the claim and in the litigation will try to prove to the Judge that work is available and the Claimant has not made a good-faith effort to try the work. We will usually tell our clients to at least attempt the light-duty job even if our clients don’t think they’re going to be able to do the job. At least then if I have to have my client testify at a later hearing the Claimant can say, with firsthand knowledge, that he or she tried the job and was unable to perform it. The Supreme Court case that lays out the employer’s burden in a Suspension Petition is a famous case called Kachinski v. WCAB, 516 Pa. 240, 532 A.2d 374 (1987).
The fourth method of stopping workers’ compensation benefits would be a modification based upon a Labor Market Survey. This sounds very complicated, however it is not near as complicated as it might seem. If the insurance carrier sends the Claimant to an Independent Medical Examiner and that doctor finds that the Claimant can perform some type of light duty work or medium duty work, and if there is no work available from the time-of-injury employer which the Claimant can perform, the insurance carrier can hire a vocational counselor to essentially find light-duty work in the Claimant’s geographical area. Once the vocational counselor finds these jobs, they are sent to the Claimant and then the insurance company can file a petition to try to prove to a Judge that while the Claimant cannot do his time of injury job, the jobs found by the vocational counselor are available and open, and vocationally appropriate for Claimant. Essentially, if the jobs are light enough that the Judge believes that the Claimant could perform them, the Judge can modify the Claimant’s wage loss benefits based on the amount of money that the Claimant could be making at any of the jobs offered. This typically leaves the Claimant with a much lower weekly check based upon the fact that the time of injury job was usually a full-duty job and the Labor Market Survey jobs are essentially light-duty jobs which usually pay considerably less.
These four methods of stopping workers’ compensation benefits all have various pitfalls for both the Claimant and the insurance carrier. However the only one of those petitions which potentially stops benefits entirely is a Termination Petition. If a Termination Petition is granted by a Judge, that stops both wage loss and medical benefits. If a Suspension of Modification Petition based upon a job offer or a Labor Market Survey is granted, only wage loss benefits would be affected.
Knowing the above types of methods for stopping benefits is incredibly important for anyone who is receiving workers’ compensation benefits. It is probably the most asked question that I receive as a workers’ compensation attorney. My clients are very concerned that their benefits may simply be stopped at any time. However, the Claimant-friendly laws of Pennsylvania certainly do not allow for the insurance company to simply stop benefits, other than in a few very limited circumstances. If you are receiving workers’ compensation benefits and are told by the insurance carrier that those benefits are simply going to be stopped, it is absolutely essential that you contact an attorney right away.