Keefe, Campbell & Associates, LLC

One great thing about American jurisprudence, like the football playoffs or most anything that appears in the public eye; you get to disagree. If you think a wide receiver in a football playoff game caught the ball but landed out of bounds and the referee calls it a touchdown, you get to disagree. The ref’s call may stand and the game may still end as a loss for your team but this is a country where we get to disagree and the referee is supposed to be willing to take reasonable and respectful criticism—it is part of the game. Our goal is to be sure all fans understand someone has to call the game and we have to accord respect to the folks who take on that mantle.

Well, in the legal sphere, we feel the same concepts should apply. We sometimes respectfully disagree with what is usually our highest reviewing court for workers’ comp purposes, the five-member Appellate Court, Workers’ Compensation Division. We want all our readers to understand they make and are charged with managing the law as given them by the legislature. What we say below is our view of two recent developments which is intended to be properly respectful of the august and learned members of the Court.

Is there any way to expedite dismissal of an appeal where the appellate bond was defective?

We recently read about a major defense firm that got whacked by the Court when they misfiled an appeal from the Commission to the Circuit Court. In Securitas, Inc. v. Illinois Workers’ Compensation Commission, et. als. (05-09-0184WC, issued Nov. 23, 2009), it appears counsel for the employer didn’t follow Illinois’ demanding appellate rules for workers’ comp appeals. If you don’t know them, once the Commission issues an award, an employer that is a corporation (and almost all Illinois employers are corporations) has to obtain and file an appeal bond in an amount set by the Commission in its award. Counsel for the employer has to prepare a number of court forms, one of which is evidence of that appeal bond. That appeal form also has to be signed by a party who has the power to bind the corporation to the debt contemplated by the bond; their title has to be on the form. All of it has to take place in twenty days without any possible extensions—a period that we consider to be the shortest of any appeal in this state.

In the case we reviewed, it appears the defense firm messed up not one but two appellate rules:

They filed an appeal bond for $10,000 when the Commission set the bond amount at $10,100;
They didn’t indicate the person signing the bond form was an officer of Respondent.

These two things combined to lead the Court to dismiss the appeal for lack of subject matter jurisdiction. We agree with that outcome because they strictly followed the “plain English” language of the Act. Our problem is the fact the case went to the Circuit and Appellate Court and sat for something like two years. The date of initial loss was November 13, 2006 and it was filed as an emergency petition; the Arbitrator’s ruling was in an emergency fashion for TTD and medical expenses only. The Arbitrator’s ruling clearly did not dispose of the entire claim which remained pending all that time. This Court’s simple and straightforward two-page ruling on that “emergency petition” issued November 23, 2009!

It remains our position the Circuit and Appellate Courts should allow for expedited summary dismissal of such claims upon motion from the opposing party. It is our impression delays associated with the briefing of all underlying issues and lengthy wait for an oral argument date is unnecessary in such circumstances.

For all of you who may want to know the name of the defense firm that had the problem, go to the web at http://state.il.us/court/Opinions/WorkersComp/2009/November/5090184WC.pdf where you will find the Court published their name on the last page. We don’t know why the Court wouldn’t “non-publish” such a simple and routine ruling under Rule 23—we don’t get to ask them such questions.

B. New rule following recent judicial discovery of a “bright line” for paying amputation losses in Illinois in our legislation that is 100 years old!!

On the other side of the same coin is a ruling we just saw reported about amputation claims. This is now the third ruling, following Beelman Trucking and the most recent Freeman United Coal decision where the Appellate Court, Workers’ Compensation Division is now demanding double weekly benefits be paid. We completely disagree with that view of the “plain English” of our Illinois Act.

In Greene Welding and Hardware v. Illinois Workers’ Compensation Commission, et. als. (04-09-0144WC, issued Dec. 23, 2009), the Court reviewed an amputation case. There is no dispute claimant lost 100% of the ring and 50% of the middle finger as the result of a work-related event. He was paid TTD in a timely fashion. There was about a six-week delay in starting statutory PPD benefits but prior benefits were paid when the first payment was made. The ruling indicates the employer’s defense counsel basically claimed at all levels of hearing and appeal that they didn’t know when to pay PPD in amputation claims—we vote you fire and replace defense counsel who demonstrates that level of confusion and uncertainty before the Commission and reviewing courts.

The Arbitrator provided an award for the amputation loss and denied penalties and fees. The Commission affirmed and awarded penalties and fees. The Circuit Court confirmed the Commission’s award.

Thereafter the Appellate Court, Workers’ Compensation Division affirmed the award including penalties and fees. The language we cringe to read is

Rather, we hold that the Act established a bright-line test for payment of such benefits. Where there is no dispute regarding whether a claimant’s amputation injuries arose out of and in the course of his or her employment, statutory benefits for amputation are to be paid no later than the time at which the employer reasonably knows the extent of the amputation and is capable of calculating the appropriate average weekly wage.

Please understand that is now the law in this state. You have to follow it in all amputation claims. Amputation occurs in Illinois when bone loss is clear—it is not typically considered an amputation when skin is lost. No one knows what to do when bone loss occurs and the bone is later reattached—that couldn’t happen in 1909 when the Act was drafted and Illinois hasn’t updated our law. We disagree with the Court’s view of this provision of Act but they are charged with enforcing it and you have to follow their rules.

In reaching an academic disagreement with the court’s majority, we look to the statute for direction. It is basically a three-part Act. Section 8(a) provides virtually unlimited medical benefits for reasonable, necessary and related care. Section 8(b) provides for temporary total disability for all periods an injured worker is off due to injury. Sections 8(c), 8(d) and 8(e) provide permanent partial disability benefits for permanent loss of use in a number of ways. The injured worker receives benefits for his/her medical bills for life. TTD is received while healing.

Thereafter, the statute uses these words about payment of PPD in Section 8(e)

For accidental injuries in the following schedule, the employee shall receive compensation for the period of temporary total incapacity for work resulting from such accidental injury, under subparagraph 1 of paragraph (b) of this Section, and shall receive in addition thereto compensation for a further period for the specific loss herein mentioned…

We academically disagree with the Court’s analysis of the Act in Greene Welding and Hardware and Lester, their prior ruling upon which they rely to ignore the clear statutory language which requires PPD be paid “for a further period” following TTD. The Court has now ruled there is a “bright line” requiring simultaneous payment of both TTD and PPD. We feel the Act doesn’t say that and there is no such “bright line” in any provision of the legislation we or other academic sources can locate.

In support of our view of the plain English version of the Act, we point out Richard K. Johnson and Martha Garcia, the astute authors of the Illinois Institute for Continuing Legal Education’s Illinois Workers’ Compensation Handbook state in Section 8.23 of their chapter on Disability Evaluation:

The amount due for permanent partial disability is payable weekly after the payments for TTD have been made.

It would appear their chapter has to now be brought up to date with the newly discovered “bright line” standard for amputation losses only. We assert numerous legal treatises and other Illinois Workers’ Compensation resources, like our KC&A WC book, the Illinois Trial Lawyers Handbook and the Commission’s own handbook may have to be brought up to date due to the recent breakthrough by this Court in their view of the payment of amputation losses as provided in our century-old Act. The ruling is on the web at: http://www.state.il.us/court/opinions/WorkersComp/2009/December/4090144WC.pdf

Why are we telling you this? Well, in 2005 the cost of amputation losses in Illinois went waaaaay up. The minimum weekly PPD rate for any Illinois amputation loss right now is $466.13. 100% loss of use of the index finger in Illinois for a part-time worker making $20 a week is at least $20,043.59. The maximum amputation loss for 100% loss of use of one index finger is $53,449.00. The minimum benefit in Illinois for 100% loss of use of an arm is $117,930.89; the maximum is $314,479.00. If you don’t follow this new payment rule and get hit with a 50% penalty and a 20% attorney fee on top of such numbers, you are looking at lots and lots of money. Follow the new rules and start to pay weekly PPD on amputation losses right away.

All in all, we want our readers to understand one overwhelming reason to read this Keefe, Campbell & Associates Monday Law Update is so you get the current gossip, new judicial “discoveries” and everything else that may be going on at the Commission and reviewing courts these days. While we don’t agree, if the ref calls it a touchdown and under scrutiny is stands as a touchdown, you have to adjust.

If you have questions or concerns about handling amputation losses or any other aspect of Illinois workers’ compensation claims handling, send a reply. We don’t charge for such inquiries and we are happy to answer on a 24/7/365 basis. Please also don’t hesitate to reply with your thoughts and comments or post them on our award-winning blog.

Editor’s comment: We were recently informed of what appears to be an unheralded shift in policy at the Commission concerning payment on statutory loss claims. Where the 1996 ruling in Modern Drop Forge Corp. v. Industrial Commission previously held Illinois employers/insurance carriers must institute payment of weekly PPD after claimant reaches MMI and the end of TTD, a couple of recent cases make it clear there is now a potential for penalties/fees when weekly PPD payment is not “immediate” upon stabilization in the post-injury setting. Yes, the word “immediate” concerns us.

As you can imagine, it’s a routine question we are faced with as workers compensation defense attorneys: “If Peter Petitioner cut off his small finger and half of his ring finger in an industrial accident, when do I have to start to pay the statutory PPD loss?” Up until earlier this year, we were operating under the holding outlined above, and advising our clients who were dealing with amputation losses:

• Medical care was to be provided;
• TTD was to be paid during recovery;
• Once Petitioner was at MMI and TTD discontinued, the weekly PPD checks should start to issue for the statutory loss.

Turns out that is not a correct statement of how they are interpreting Illinois law at the Commission and reviewing courts these days. We have to admit to our readers and clients we were arguably wrong to the extent we were following the “plain English language” version of the Act. Please read this article carefully and implement it in all your Illinois amputation claims. Please don’t hesitate to contact us about it at any time.

Illinois “mega-rates”—we have very high weekly amputation PPD minimums and maximums

Along with concerns about when to start paying such claims, we also caution everyone there is a very high PPD minimum and maximum in Illinois for amputation losses. The current minimum is $466.13. You don’t hit the amputation minimum until claimant makes more than $776.88 per week or a little over $40,000 per year—anyone who makes less and suffers an amputation will receive the minimum weekly amount.

The maximum amputation rate is 60% of the average weekly wage to the TTD and not PPD maximum. The current Illinois TTD maximum is $1,243.00 per week. Someone who makes $2,017.67 or more per week will receive PPD due to an amputation loss at that rate–$1,243.00 per week. The amputation value for 100% LOU of one arm for such an individual in Illinois pays a whopping $314,479.00.

We also caution these “mega-rates” only currently apply to the body member values for the amputated member—we have not seen the Commission or reviewing courts apply the much higher rates if claimant suffers an amputation and also injures other body parts. For example, if a worker making $200 per week loses the right little finger and also breaks their left arm, you would owe the amputation rate of $466.13 for the right little finger but would owe PPD for the left arm at $200. Due to the disparity in rates, veteran claims handlers will advise an amputated little finger can be more valuable to the claimant than a badly broken arm.

We also had one observer advise defining an “amputation” loss is sometimes difficult to do, particularly in the realm of modern science. It is our view an amputation occurs when there is bone loss only—you need to check x-rays to confirm there actually is bone loss versus all other possible tissues of the human body. We have never heard of any other type of “amputation” being given the special treatment it is given in this state.

Going on the presumption “amputation” means bone loss, questions still arise

• Is it an amputation loss if the finger/toe or other member is surgically reattached?
• Is it an amputation loss if the middle section of a bone is removed/trimmed and grows back?
• If the surgeon can graft bone back into the arm or leg to get it to regrow and recover, it is still an amputation?
• Is a total knee or hip replacement an “amputation” of the leg?

We have no idea what the Commission would do with such questions and will report to you if we get a definitive answer now or in the future. We hope there is no penalty and fee exposure until such questions are clearly answered.

Understanding how the Commission and reviewing courts are now ruling in amputation losses

Going back to “when to pay” weekly amputation benefits, we point out Section 8(e) of the Act specifically states a Petitioner will first receive medical care under Section 8(a). At the same time, they should receive TTD under Section 8(b). Our “plain English version” of the Act then says they “shall receive in addition thereto compensation for a further period for the specific loss herein mentioned.” Our interpretation of that legislative statement, specifically the phrase “for a further period” necessarily means the duty to pay weekly PPD should not begin until “the further period” after weekly TTD ends. Well, as we have told our readers and law students over and over, there is no legislative history to the Illinois WC Act and the administrators and courts sometimes create the rules as they go along. Whether you agree with them or not, you have to follow them, in this instance to avoid penalties and fees.

We recently ran across a pair of IWCC cases which state differently – Bobby D. Kinnaird, Jr. v. Greene Welding & Hardware, decided by the Commission in July 2008 and Lary Nobile v. Midwest Wrecking Co., decided by the Commission in July 2009. According to these two cases, payment of weekly PPD for an amputation is due “immediately” upon the worker suffering the amputation, MMI or no, when no dispute exists as to the compensability of the accident or the amputation itself. There is no waiting period or other possible delay contemplated—if you read the cases, they mean you owe benefits the day of injury until the full statutory amount is paid in full.

Modern Drop Forge Corp. v. Industrial Commission was the old standard we judged this issue by, but it is not directly on point – there the issue was Petitioner’s potential wage differential claim, Respondent argued since it did not know what remedy Petitioner would select, it had a reasonable delay in starting payment. The court in Modern Drop Forge ruled the delay was not reasonable as the statutory loss could have been applied as a credit on any wage loss settlement or award. Penalties/fees were applied in that case because Respondent waited three years to offer any payment.

Since Section 8(e) of the Act specifically states a Petitioner will receive TTD and then “shall receive in addition thereto compensation for a further period for the specific loss herein mentioned” – our interpretation of that statement, specifically the phrase “for a further period” necessarily meant PPD did not begin until TTD ends. As such, combined with our interpretation of Modern Drop Forge, exposure for penalties/fees in an amputation loss would begin to run the minute a claimant was at MMI from a work injury, as that is when PPD should begin. We are no longer providing such advice.

In Kinnaird, Respondent, similar to what we have outlined herein, did not pay the PPD portion until Petitioner was at MMI, even though Petitioner had returned to light duty work for some time. The Kinnaird decision goes so far as to state “Respondent’s argument that Petitioner had not reached maximum medical improvement, and, consequently, payment was not yet due, is without merit. There are no cases cited in support of such an argument and such requirement is not found within the language of the Act to indicate such a legislative intent. Respondent provided no acceptable explanation to show any reasonable belief to justify the delay in payment for this statutory loss injury.”  In Nobile, the Respondent argued since it was undetermined whether Petitioner lost 50% or 100% of the finger, penalties should not have applied on the late payment. There, the Commission cited Kinnaird and held penalties applicable to the 50% of the finger not at issue.

After our review, it is our reasoned legal opinion you should start paying weekly amputation at the correct amputation rate as soon as you have confirmed there is an amputation loss in a compensable event. Such payments should begin essentially on the day of the injury if you want to be sure to avoid penalties/fees. We hope a reasonable period of time would be provided to the claims handler beyond the day of injury, say for up to a month, in order to set up a file and issue the first check for whatever had accrued. We do note existing IWCC case law states 60 days to start such weekly payments is too long, and you may get hit with penalties and fees if you wait that long. As is the case in any litigation – if you are disputing the loss, please consult with defense counsel and document your files accordingly. In amputation losses, you need to have clear, convincing and reliable evidence to avoid the additional exposures that come with serious and unquestioned injuries.

This article was researched and written by Arik D. Hetue, J.D. If you have thoughts and comments, please send a reply to ahetue@keefe-law.com, or post them later today on our award-winning blog at www.keefe-law.com/blog.

Editor’s comment: We here at KCA have heard through the grapevine a veteran defense firm in Illinois has advised a mutual client of ours the minimum amputation rate applies only to arms and legs. We would like to confirm for all our readers that it does apply to any scheduled amputation, not just arms and legs.

Let’s take a look at the crux of the issue here. As any veteran Illinois claim handler knows or should know, when an injured worker suffers an amputation of a “member”, according to Section 8(b) 4.1 of the Act, they are entitled to immediate compensation at a minimum rate of 50% of the statewide average weekly wage. Currently, this is $461.78. Please be aware, this rate applies to amputations even if an injured worker earns less than this amount – if you have a part time worker who earns only $250.00 per week as their average weekly wage, they are entitled to $461.78 for industrial amputations.

Last week we were surprised to learn this defense firm suggested to a TPA the amputation rate only applies in situations where an injured worker has lost an arm or a leg, because the Illinois Act uses the words “amputation of a member … under paragraph (e) of this Section” when describing when the minimum rate kicks in. This is not totally out of left field, as according to Webster’s Dictionary a “member” is a body part or organ, such as a limb.

We must point out however, this attempt at legal contortion is abruptly cut short by further language of the Illinois Act itself. As stated above, Section 8(b)4.1 specifically states the amputation rate apples to any member under 8(e). Section 8(e) of the act is the categorical disability schedule for all body parts covered under the act. The first paragraph of that section specifically states in relevant part:

The following listed amounts apply to either the loss of or the permanent and complete loss of use of the member specified, such compensation for the length of time as follows (emphasis added).

Immediately following that sentence, Section 8(e) goes on to list every body part in the schedule including fingers, toes and other organs and the amount of weeks such “members” are assigned.

Further evidencing this interpretation is Lester v. Industrial Com’n, 256 Ill.App.3d 520, 628 N.E.2d 191 (1^st Dist. 1993), a decision where the severed body parts were fingers, in which the unanimous members of the Appellate Court state in relevant part:

…we find that the legislature intended that individuals who receive amputations should be immediately compensated when no dispute exists as to whether the injury arose out of and in the course of employment.

While this case dealt with a separate provision of the Act which requires employers to pay such amputation compensation immediately upon confirmation there is no dispute to that amount, rather than waiting for settlement or trial to confirm the total amount owed, it nonetheless confirms that fingers count as members for purposes of the Act. With respect to the members of the other defense firm, it is our reasoned legal opinion the minimum weekly amputation rate applies in all amputations whether it is a limb, organ, finger or toe.

This article was researched and written by Arik D. Hetue, J.D. If you have thoughts and comments, please send a reply to ahetue@keefe-law.com, or post them later today on the blog at www.keefe-law.com/blog.

Editor’s comment: We have recently been asked about this issue by our clients. Here are some simple thoughts.

1. Is it an amputation? In Illinois, you can lose parts of your fingers/toes and not suffer a compensable amputation in this state. The first question any adjuster or lawyer will ask is whether there is bone loss? You need to check x-rays or other diagnostic records to be sure. Don’t trust doctors’ notes because traumatic removal of skin at the tip of the finger/toe may be called amputation in a medical record—that won’t legally qualify as an amputation loss unless there is also bone loss. As you may see, the difference can be enormous due to the varying rates that will apply.
2. If it is an amputation, your reserves have to reflect three unusual aspects about Illinois claims practice
3. There is a very high minimum in our state—right now; a worker making $50 per week who suffers a compensable amputation loss is entitled to receive PPD at a weekly rate of $461.78.
4. There is a very high maximum in Illinois for amputation losses. You still take 60% of the average weekly wage but the maximum for a claim occurring today is the TTD maximum or $1,231.41. An amputated arm in Illinois may now entitle a highly paid worker to as much as $311,546.73.
5. You have to pay TTD while the injured worker is treating and then seamlessly change benefits to the weekly PPD amount thereafter. You can continue to negotiate with the worker to reach a lump sum that may be palatable to an Arbitrator but you have to keep paying weekly PPD benefits while doing so. If you don’t, you may be subject to a 50% penalty and a 20% attorney fee on unpaid amounts.
6. Most claimant lawyers shun accepted amputation cases unless there is the possibility of some sort of lump sum settlement. In an undisputed amputation claim where all benefits are being paid timely and in the proper amount, the claimant attorney only receives $100 under the statute for handling the claim. For this reason, many amputation claims are resolved on a pro se basis.
7. Our goal when we are called about an unfortunate amputation event is to advise the client of the above nuances and tell them their abiding goal in such claims is to take care of the employee—get them the best orthopedic surgeons available and provide TLC. Be sure the employee understands they are going to be taken care of and don’t need counsel.
8. An injury to two or more fingers may be handled as loss of use of the hand. However, please also note the combined value of the fingers and thumbs is about the same as the total value of a hand—don’t overpay a claim because counsel wants it to be a hand and not a finger(s) claim.

We caution all of our readers even veteran attorneys miscalculate the amounts due because all these changes haven’t caught up to some of the players in the system. If you have questions or concerns about reserving or handling amputation claims, please send a reply.

Editor’s comment: This is actually the extended answer to our KC&A Trivia Corner question last week. We got so many quizzical inquiries; we wanted to make sure all of you were on board with this mildly unusual and hopefully rare work injury claim.

Illinois claimants are entitled to a bunch of things when they suffer a compensable amputation at work. Amputation to a finger or toe occurs when the affected digit(s) suffer any bone loss. It is possible to cut off the tip of one’s finger and not suffer a compensable amputation—the lost tissue cannot contain any bone. In the vast majority of situations, tissue without bone loss grows back and may result in typical compensation for either specific loss or disfigurement at normal PPD rates. When you ask a veteran defense lawyer about whether it is an amputation, they will first ask about bone loss—check x-rays or other medical tests for accuracy on the issue.

If the employee suffers an amputation of even a miniscule portion of bone at the tip of the finger or toe, three issues arise for the claims handler to consider.

• The low-wage employee becomes entitled to the very high minimum PPD rate for amputation loss—it is currently set at $456.28. Therefore, if you have a worker making $95 per week who suffers the loss of some bone in the tip of his middle finger, he is entitled to 50% of the middle finger or 19 weeks times $456.28.
• The high-wage employee becomes entitled to the very high maximum PPD rate for amputation loss—it is currently set at $1,216.75. The maximum PPD rate is set by taking 60% of the average weekly wage to the maximum for amputation loss. To reach the maximum PPD rate for amputation loss, an employee would have to make $2,027.92 per week or just over $100K per year. You may note the full undiscounted value of 100% loss of use of the thumb in this state for a maximum amputation rate claimant is 76 weeks times $1,216.75 or $92,473.00!
• Claimant attorneys in Illinois who handle undisputed amputations claims typically receive legal fees of $100. There is one major exception to this limitation—as a claims handler with an amputation loss; you have to start paying weekly PPD benefits at the correct rate as soon as the employee reaches MMI. If you don’t, whether you knew the rules or not, a claimant attorney can seek to receive both a 50% penalty for claimant and a 20% attorney fee on accrued PPD due until the weekly amounts due are paid up to date. Please note you may still continue to negotiate with claimant to close the balance of PPD due and any future medical rights but you have to continue paying weekly PPD while you are doing so.

We want all of our readers to know the last trivia question is a teaser—we inquired as to whether a surgically reattached member can still qualify for amputation handling. Having again recently researched the issue, we are confident the IWCC has not yet decided such a case. We don’t feel one should be able to receive the additional and generous benefits for amputation if the member is reattached and works normally. But we aren’t in a position to make that final decision so we will continue to wait and watch until our Commissioners tackle the problem and then report their wisdom on what may be a tough ruling.

Please also note many claims handlers are confused by the provision of the Act that allows the loss of two or more digits to be treated as the loss of use of the hand. Our vote is don’t be confused. If you do the math, the sum of the Illinois weekly PPD values for the thumb and other fingers actually exceeds the loss of use of the hand. If you compensate for 100% loss of use of the first and second fingers, it is the equivalent of 39.5% loss of use of the hand. If the Arbitrator writes the award on the fingers or the hand, it typically won’t make a great deal of difference.

Our strong vote on amputation claims is TLC—apply tender loving care to someone who is suffers one of the cruelest losses a human can suffer. Go the extra mile to insure the employee is taken care of and advised they will get the best possible medical care and benefits during their recovery. Consider referrals to hand specialists like Drs. Jay Pomerance, Michael I. Vender, Evan Crandall or Peter Hoepfner. When the worker reaches MMI, let them know you are taking further care of them by both accommodating any restrictions and also paying them what they are due under our Act. Many of our clients have obtained best possible outcomes with this approach. If you have further questions, thoughts or comments about handling amputation losses in Illinois, please send a reply.