January/February 2002 - Highlight

Law Court Upholds Stacking of Permanent Impairment Benefits Under Section 201(4)

The recent opinion by the Maine Supreme Judicial Court, sitting as the Law Court, Kotch v. Protective Services (2002 ME 19, see inside), appears likely to affect the number of partial incapacity cases in which employees may escape the durational limit for benefits.

The Law Court in Kotch decided that the Board correctly stacked whole body impairments together in cases involving impairments to separate body parts, including body parts with a preexisting condition, not affected by the work injury. The appeal involved two cases consolidated together. In one case, the employee, at the time of the low back work injury, already had a preexisting knee injury that had occurred during military training with the Marines. In the other case, the work injury was a hip injury. The employee at the time already had the following prior injuries: (1) a gunshot wound in his hand during his military service in Vietnam; (2) a knee injury in 1972 from "walking on hard floors"; (3) a ruptured-disc back injury in 1974; (4) a knee injury while employed by another employer in 1994; (5) a crush injury to his thumb while employed by the employer in 1995; and (6) a serious head injury while employed by the employer in 1995.

In each case, the Hearing Officer had concluded (i) that all of the above conditions, combined together, contributed to the employee's current incapacity, and (ii) that the contribution of the work injury itself was "significant" under 39-A M.R.S.A. §201(4).

The Court concluded that the Hearing Officers' findings permitted them to "stack" together the Permanent Impairment ("PI") ratings of all of the body parts, even though in each case the work injury did not aggravate or accelerate any of the prior conditions or otherwise combine physically with the prior conditions. In each case, the "stacked" PI rating exceeded 11.8%, even though the PI rating for the body part injured at work did not.

The result is that because the stacked PI exceeded the 11.8% figure, these employees' benefits will not be subject to the durational limit on partial incapacity benefits.

The results of the decision are two-fold: First, an increased number of employees may exceed the 11.8% threshold and therefore avoid the durational cap for partial incapacity benefits. Second, depending upon the actuarial results, the ruling may ultimately raise the 11.8% threshold.

The Maine Workers' Compensation Board is responsible for reviewing the threshold annually to attempt to place one-fourth of all cases above the threshold and three-fourths of cases below the threshold. If actuarial figures indicate that post-Kotch PI figures are increasing, there will be reason for the Board to adjust the 11.8% threshold upward in order to achieve the one-fourth to three-fourths balance.

The Kotch decision should not result in the stacking of each and every physical impairment. The decision applies only to conditions that preexist the work injury. Nor would it appear to apply to conditions that do not contribute to a decreased ability to work or to find work. Nor does it address conditions that develop subsequently to the work injury, such as under §201(5), which addresses a "subsequent nonwork-related injury or disease which is not causally connected to a previous compensable injury."

The Kotch case is not necessarily the last word from the Maine Supreme Judicial Court regarding "stacking." For instance, the Court has not addressed the interaction between §201(4) and §201(5) in stacking cases. Nor has the Court addressed a case in which the impairment to the body part at issue contributes only in a minuscule or nonexistent manner to incapacity.

- Thomas R. Kelly, Esq.