Partial Denial does not Allow Apportionment of Impairment at Claim Closure in Oregon
On April 21, 2022, the Oregon Supreme Court issued its decision in Johnson v. SAIF Corporation, 369 Or 577 (2022).
Johnson caught her hand in an elevator door at work. SAIF accepted various finger contusions/abrasions, but later denied a request to add a rotator cuff tear to the claim. The claim for the accepted hand conditions closed without impairment. Upon reconsideration, a medical arbiter panel found reduced grip strength that it apportioned 50% to the accepted conditions and 50% to the denied rotator cuff tear condition. Although the Board agreed with the apportionment of the PPD award, the Court of Appeals reversed. The Supreme Court accepted review.
The Oregon Supreme Court has now affirmed the decision of the Court of Appeals. The Court extended its holding in Caren v. Providence Health System to this case involving a denied condition. It held that if an accepted condition materially contributes to impairment, the worker receives the “full measure of impairment”. According to the Supreme Court, the only exception is when a combined condition has been accepted and denied. Other denials, like the partial denial here, essentially have no legal effect on permanent impairment awards. Rather than considering the portion of the impairment caused by the accepted conditions, the Court interpreted “due to” as requiring only a material contribution to the impairment overall. Once this low bar is met, the worker receives the full amount of impairment regardless of the fact that medical experts confirm part or even most of the impairment is due to a denied condition. To reach this determination, the Supreme Court started with two Barrett v. D&H Drywall opinions from 1985 and 1986, in which it had stated “an employer takes the worker as he finds him [sic]”. The Supreme Court also acknowledged that the legislature overhauled the workers’ compensation system in 1990 in response to the Barrett decisions. Nonetheless, it interpreted the legislature’s intention in that overhaul as only to carve out a very narrow exception to the underlying tenet of Barrett for combined conditions. Apportionment does not exist for denials of any other nature.
The Supreme Court does confirm in this decision that a worker would not get other benefits for a denied condition or receive impairment attributable solely to a denied condition. However, the decision is still problematic.
Combined conditions do not exist in every case where conditions have been correctly denied. Moreover, this case highlights a practical problem. Johnson’s doctor did not find any impairment due to the accepted conditions or any combination with the denied shoulder condition. Only during reconsideration did an arbiter in a one-time exam decide such impairment existed and relate it partially to the accepted conditions. SAIF could not have reasonably anticipated the need to explore a combined condition. A legislative fix is needed here to make sure workers’ compensation benefits are not misdirected to pay for impairment that is not work-related. In the meantime, employers/insurers should carefully assess each claim and claim closure to determine the best processing options.
If you have questions about this decision or its consequences for a claim you are processing, please give me a call at 503-595-2134 or email at .