Workers Compensation Defense for Insurance Carriers and Self-Insured Administrators

Workers’ Compensation Pointers for Employers, Insurance Carriers, and TPAs

Hill Evans Jordan & Beatty’s Board Certified Workers’ Compensation Attorneys have years of experience successfully advising and representing employers, insurance carriers and third party administrators in North Carolina Workers’ Compensation cases.  We provide responsive, cost effective representation that is tailored to your specific needs and circumstances. Whether you are looking for advice on whether a claim should be accepted or denied, developing a modified duty work program to mitigate lost time claims, engaged in a medical dispute, seeking to end ongoing TTD or TPD payments, trying to negotiate a settlement, or looking to litigate a matter to a final determination, Hill Evans Jordan & Beatty’s experienced Workers’ Compensation attorneys can help.

In complying with the multitude of sometimes complex requirements for managing Workers’ Compensation claims, there are several key factors to consider.  

Managing Claims

Employer’s First Report of Injury
  • Employer must report injury/occupational disease or allegation of injury/occupational disease to you immediately if the attention of a physician is needed or actually sought
  • Within 5 days of the employer’s knowledge of injury/disease or allegation of injury/disease, you must file a Form 19 if:
    • the employee misses more than 1 day of work; and
    • medical compensation totals more than $2,000
  • Form 19 must be filed with the NCIC and a copy must be sent to the employee along with a blank Form 18.

Considerations:

  • The Form 19 does not give the Industrial Commission jurisdiction over the claim and you are not bound to the terms of the accident description or the Average Weekly Wage you put on the Form 19.  The document is required form informational and statistical purposes.
  • Failure to file a Form 19 is subject to an administrative fine.
Effect of Employee Filing of Form 18
  1. When a Form 18 is filed, the Industrial Commission gains jurisdiction over the claim.
  2. If you have not already admitted or denied liability for the claim, within 14 days after receiving a Form 18, you should admit the claim [Form 60], deny the claim [Form 61] or pay the claim without prejudice for up to 90 days [30-day extension available] before admitting or denying the claim [Form 63].
NCGS§97-28 Seven Day Waiting Period; NCIC Rule 401
  • NCGS§97-28 No indemnity compensation is payable during the first 7 days of disability related to a compensable injury.  If the period of disability lasts more than 21 days, then the employee is paid for the first seven days.
  • NCIC Rules 401 & 402:  In calculating the 7-day waiting period:
    • If the employee does not receive full wages on the day of injury, include that day in the 7-day period
    • If paid in full on the day of injury, and employee does not return to work on his/her next regularly scheduled work day, the first day of the 7-day period is the next calendar day after the date of injury, even though this may not be the next scheduled workday
    • All days for which the employee is unable to earn full wages due to the injury are counted in the 7-day period, even if these days are not consecutive or regularly scheduled workdays
    • If the permanent disability period, when added to the temporary disability period, exceeds 21 days, there is no waiting period.
Notice of Accident to Employer and Claim of Employee, Representative or Dependent

Employee must give written notice to the employer as soon as practicable.  If no notice within 30 days, no compensation is payable unless (1) NCIC is satisfied with employee’s excuse for not doing so and (2) NCIC is satisfied that employer was not prejudiced.

REALITY: It is hard to escape liability based on an employee’s failure to file written notice within 30 days.  If the employer has no way of knowing of the claim, is unable due to lack of notice to provide early medical intervention and investigate the facts of the claim, then your odds of prevailing are increased on a defense under NCGS§ 97-22.  Actual knowledge of the injury by accident claim y the employer will defeat the late notice defense under NCGS§ 97-22.

NCGS§97-18(j) Duties of employer/insurer:  
  • Promptly investigate each reported or known injury.
  • Admit, deny or pay without prejudice as soon as practicable.

CAUTION:  After an employee files a claim with the Commission, the Commission may impose sanctions if within 30 days the employer or carrier does not admit, deny or pay without prejudice.

NCGS §97-24  Right to Compensation Barred after 2 Years-

The failure to meet the requirement to file a claim within 2-years of an alleged accident/knowledge of occupational disease under NCGS §97-24 will bar an employee’s claim for benefits.  If a Form 18 is not filed by the employee within 2 years of the alleged accident/knowledge of occupational disease, the claim will be barred unless:

  1. A Form 21 agreement has been entered regarding compensation;
  2. The employee is paid compensation [Voluntary acceptance]; or
  3. A claim is filed or Form 21 agreement entered within 2 years after the last date of payment of a medical compensation on a medical only claim.
NCGS§97-18(b)  Admission of compensability.  File Form 60.
  • The first payment of compensation is due on the 14th day after you have notice of the accident/injury.  Payments are due weekly thereafter during the period of disability.
  • Any payment that is not paid within 14 days of becoming due is subject to an automatic 10% penalty.  Unless due to a cause over which you had no control, you are supposed to add the 10% to the check due to the employee.
  • If the terms of the Form 60 are changed at any point, you must file an amended Form 60 or a Form 62, depending on the nature of the change.  Note-You cannot terminate compensation unilaterally by modifying a Form 60 or filing a Form 62.
  • Failing to file a Form 60 even though you start paying benefits can result in sanctions.  There have been cases where up to $1,000, usually in the form of an award of plaintiff’s attorney’s fees, has been imposed for a failure to file a Form 60 or Form 21 admitting liability
Calculating Average Weekly Wage

Average Weekly Wage- NCGS§97-2(5); NCIC Rule 402; Form 22

NCGS§97-2(5)  provides a hierarchy of formulas for calculating AWW.  

  • Primary method:  This method must be used unless shown to be inappropriate under the circumstances of the case.  When you have 52-weeks of wage data immediately preceding the date of injury, divide the gross wages for that period by 52.  But, if the employee missed more than 7 consecutive days at any one time during the 52-week period, the earnings for the remainder of the 52-week period are divided by the number of weeks remaining after the time so lost is deducted.  Note-This is why the Form 22 requires that the employer mark an “x” for each day during the 52-week period that the employee was paid in full.  This enables the Commission and the parties to count blank spaces to determine if periods of greater than 7 consecutive days have been missed.
  • Second method:  If employed less than 52-weeks, but it would still be fair, divide the gross wages by the number of weeks worked, with an adjustment for any periods where more than 7 consecutive days were missed.
  • Third method:  if the primary method and secondary methods would be unfair due to shortness of time of employment before the injury or the nature of the employment relationship, regard is to be had to the AWW of other employees of the same grade and character in the same class of employment in the same community for the 52-week period.  
  • Fourth method:  Where none of the above would be fair for exceptional reasons, any other method that would most nearly approximate what the employee would be earning if not for the injury. This applies in cases of intermittent or seasonal employment where the employee would not work throughout a full year even if uninjured.

Closing Claims

The right to medical compensation continues for two years after the last payment of indemnity or medical compensation.  However, an employee with a condition that carries a substantial risk of requiring future medical compensation, like a knee replacement, can file a Form 18M seeking to keep the medicals open indefinitely with regard to the condition.  See NCGS §97-25.1. We can oppose the Form 18M, but if a competent doctor certifies that the employee is substantially likely to have future problems, the Commission will approve it.

If there is a PPI rating in a case, you cannot close out the claim without resolving the PPI liability.  This is most efficiently done in a clincher agreement that ties up all liabilities under the Act upon approval by the Commission.  However, there will be cases where an employee has successfully returned to work ending his or her right to Temporary Total Disability benefits (NCGS§97-29), but has been assigned a PPI rating.  The employee is entitled to payment for the PPI rating under NCGS§97-31. The statute of limitations of the claim will not start running until the PPI rating is settled. PPI ratings are settled by Form 21 agreements if they are not addressed in a broader clincher agreement.  Once you agree on a rating amount and value with the employee, the agreement must be written up on a Form 26A Agreement and submitted to the Commission for approval along with all material medical records connected with the case. This may include medical case management and vocational rehabilitation reports in addition to medical records.  A Form 25A must be filed with the Form 26A certifying that all material medical records and vocational reports have been provided to the plaintiff and filed with the Commission. It is often beneficial to pay the PPI ratings in a lump sum rather than weekly overtime to avoid extending the limitations period. You must file a Form 28B within 16 days of the last payment of compensation.

Note: If the employee has returned to work at a lesser wage and is entitled to Temporary Partial Disability compensation (NCGS§97-30), he or she may choose to elect between a maximum of 300 weeks (500 weeks if claim arose on or after June 24, 2011) of TPD or his or her PPI rating.  

Under NCGS 97-47, following an award, a claim may be reopened for a substantial change of condition within two years of the last payment of compensation.  “Compensation” under the Act means indemnity as opposed to medical payments, which are labeled as “Medical Compensation.” In cases where only medicals have been paid, a claim of change of condition must be made within 12 months of the last payment of a medical expense.

After the final payment of indemnity and medicals on a claim, file within 16 days:

  • If PPI paid out on a Form 26A, a Form 28B; or
  • If settled by a clincher agreement, a Form 28C

Practice Section Lawyers

Benjamin D. Ridings

ben-2018

Richard Granowsky

richard2018

(336) 379-1390

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