Recent Cases - Medical Benefits Under A Prior Open Award

April - Workers' Compensation Appellate Commission

Medical Benefits Under A Prior Open Award

The Workers’ Compensation Appellate Commission has addressed the defendant’s obligation to pay medical benefits under a prior open award of benefits, as well as related procedural issues. In Kerrigan v Suds Mobile Cleaning Systems, 2007 ACO #187, the Magistrate had previously entered an open award of benefits that included an obligation to pay reasonable and necessary ongoing medical benefits “including, but not limited to, treatment recommended by” a particular doctor. After that award had become final, the employer filed an application to, amongst other things, challenge whether plaintiff’s ongoing medical treatment was reasonable and necessary. To prove its point, the employer scheduled two medical depositions. Those medical depositions were quashed by the Magistrate, however, on the basis that the employer was refusing to authorize medical treatment as required by the terms of the prior open award. The employer challenged that quashing of depositions before the Appellate Commission. An oral argument was held.

Oddly, before the Appellate Commission resolved the case, the propriety of the Magistrate’s ruling quashing the depositions became moot because the employer agreed to pay the medical bills in question, but the defendant pursued the appeal nonetheless. The Appellate Commission said, “Having now fulfilled their obligation to provide ongoing medical, defendants will now receive the relief they sought here at the Commission,” namely: the ability to take the depositions quashed by the Magistrate. However, the Appellate Commission then proceeded to address the procedural question presented. The Appellate Commission majority said the Magistrate did not err in quashing the depositions due to the defendant’s failure to provide ongoing medical treatment. The concurring Commissioner, Commissioner Grit, agreed with the majority and said “[b]ecause of the importance of the issues raised, I believe we should address these cases.” Commissioner Grit then explained:

The defendants are looking for a ruling that says they need not pay for medical benefits under an open award whenever they dispute the work-related nature, reasonableness or necessity of the medical treatment. The defendants believe that if they decide the medical treatment is not compensable, they can refuse payment, even under an open award, until a magistrate rules otherwise. The defendants are wrong.

The defendants ask us if they have to pay for medical treatment that might be grossly inappropriate, unrelated to the work injury, unnecessary and/or unreasonable. The answer is yes. The reason the answer is yes is because there is an order (in this case final) requiring the defendants to do so. That order remains effective until or unless a different order is entered. And until a different order is entered, the defendants may have to pay bills that they should not have to pay. The logic behind that reasoning is provided by the Supreme Court in Garcia.

See also, Schultz v Pontiac Osteopathic Hospital, 2007 ACO #82, which contains a historical review of MCL 418.315(1) in the context of a prior open award granting unspecified ongoing medical benefits.