QIW Finding Not Required to Settle Rehab
Saturday, March 1, 2003 | 307 | 0 | min read
Is a represented injured employee eligible for a VR settlement if s/he has not been determined a QIW?
The short answer, according to the DWC, is "Yes." Administrative Director Dick Gannon has stated publicly that L.C. section 4646 does not mention medical eligibility for VR as a prerequisite for a settlement so the DWC has no authority to impose a QIW determination as a requirement. The new DWC regulation (CCR section 10131.2) implementing settlements also makes no mention of QIW status so Unit Consultants will not consider medical eligibility when deciding to approve or disapprove a settlement agreement. I believe the DWC ignored some key facts and that insurers may be placing themselves in some jeopardy with their insured employers if VR is settled before prior to a QIW determination.
First, it is significant that L.C. section 4646 occurs in Article 2.6 that deals with Qualified Injured Workers and the benefits and services to which they are entitled. L.C. section 4646 occurs at the end of the provisions dealing with those benefits and services, not near the beginning where eligibility is discussed. It is also noteworthy that the Legislature modified L.C. section 4644 to include closure language for settlement (L.C. section 4644(a)(8)); ALL of the closure considerations in L.C. section 4644 (a) deal with the means by which an employer can terminate liability for an injured worker who has been determined a QIW. QIW as a prerequisite for settlement should appear obvious.
The DWC also ignored the authority granted the Rehabilitation Unit by the Legislature in L.C. section 139.5. The Unit is granted authority to foster and develop rehabilitation plans to facilitate a return to work for injured employees. The Unit has the authority to make a QIW determination but it cannot order benefits or services until it has made that determination. Try to imagine a circumstance where the Unit orders VR benefits and services for an injured worker where the only available medical evidence releases that employee to regular duty. The Unit has no such authority so how can it approve a settlement for an individual who otherwise would not be within its jurisdiction?
This disregard of statutory authority creates significant risk for carriers vis-a'-vis their insured accounts. Insurance companies may consider settling cases where there is some risk of an eventual QIW determination as good business. The settlement avoids litigation costs and precludes the possibility of a $16,000 liability. Employers may look at this situation quite differently. The employer may view the injured employee as a malingerer who is just trying to "milk" the system for more money. Employers would also not want it getting back to current employees that a workers' comp claim value can be increased by a thousand - or two or three - simply by raising the issue that vocational rehabilitation might be necessary. And many employers now understand that these settlement costs accrue to their experience modification factors and will be rather unhappy knowing that these settlements will help determine their future premium rates. Unhappy employers have been known to sue their insurance companies.
Insurers might be well advised to agree to settlements on disputed QIW cases only after consultation with the insured employer. With all due respect to Mr. Gannon, the DWC will not be there to assist the insurer in explaining the merits of settling these disputed cases.
Contributed by vocational rehabilitation expert Allan Leno, Leno & Associates, (818) 370-8859 firstname.lastname@example.org.
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