W.C. Nos. 4-385-183, 4-270-243Industrial Claim Appeals Office.
March 25, 2002
FINAL ORDER
The claimant seeks review of a Corrected Order of Administrative Law Judge Schulman (ALJ) dated August 29, 2001, which denied a claim for penalties. The claimant also seeks review of the Corrected Order insofar as it determined the ALJ’s prior order of July 31, 2001, improperly addressed the issue of maximum medical improvement (MMI). Because we conclude the claim for penalties is barred by the statute of limitations contained in §8-43-304(5), C.R.S. 2001, we affirm the denial of penalties. The appeal is dismissed without prejudice insofar as it pertains to MMI because the ALJ’s ruling is not final and reviewable.
The claimant sustained a compensable shoulder and neck injury on October 13, 1995. At the time the claimant was employed by respondent Jack Stern, who was insured by respondent Pinnacol Assurance (collectively Stern respondents). The claimant was first placed at MMI on November 7, 1996 by a treating physician. The Stern respondents filed a final admission of liability which included an admission of liability for permanent disability benefits based on a 12 percent whole person medical impairment rating. The claimant objected to the final admission.
Subsequently, the claimant experienced a worsening of the shoulder and neck condition. In April 1998 an MRI revealed a herniated disc at C6-7. On April 14, 1998, Dr. Harmann requested Pinnacol to grant prior authorization for a cervical diskectomy. However, on April 22, 1998, the insurance adjuster mailed a letter to Dr. Harmann denying the request for surgery on grounds the disc herniation was not caused by the 1995 the injury. At the time of this denial, the adjuster had not obtained the opinion of a medical professional evaluating the request for prior authorization. The adjuster obtained a professional opinion from Dr. Hughes on or about May 7, 1998, and a copy of that opinion was apparently forwarded to Dr. Harmann and claimant’s counsel on May 12, 1998. (See Claimant’s Exhibit 4, May 8, 2000).
The claimant underwent surgery at C6-7 on September 24, 1998. However, the respondents denied liability for the surgery.
The claimant sought a determination that the worsening of his condition and consequent need for treatment were caused by the October 1995 industrial injury. The claimant also sought temporary disability benefits and several penalties. Insofar as pertinent, the claimant argued he is entitled to penalties under §8-43-304(1), C.R.S. 2001, because Pinnacol violated Rules of Procedure XVI (I) and (J), 7 Code Colo. Reg. 1101-3, regarding requests for prior authorization of medical treatment.
In the initial order dated July 31, 2001, the ALJ found the claimant’s worsening of condition and need for treatment, including the 1998 surgery, were caused by the industrial injury. Consequently, the ALJ ordered the respondents to pay for reasonable and necessary medical treatment including the cost of the surgery. The ALJ also determined the claimant is entitled to temporary disability benefits commencing September 24, 1998, and that the claimant had “not yet returned to MMI” for the worsened condition. Finally, the ALJ held the claimant is not entitled to any penalties based on Pinnacol’s alleged failure to comply with Rule XVI. Specifically, the ALJ concluded the claimant did not prove the surgery requested by Dr. Harmann required prior authorization under the rules. In any event, the ALJ found the claimant did not request penalties until he filed an application for hearing on February 2, 2000, and this request occurred more than one year after the claimant first became aware of the alleged violation in 1998. Consequently, the ALJ concluded the claim for penalties is barred by the statute of limitations contained in §8-43-304(5).
Both the claimant and the Stern respondents petitioned to review the July 31 order. The Stern respondents contended the July 31 order improperly addressed the issue of MMI following the worsening of condition. On August 29, 2001, the ALJ entered the Corrected Order and held the question of whether the claimant reached MMI after the worsening “was not at issue.” Thus, the Corrected Order deleted all references to MMI found in the July 31 order. Otherwise, the July 31 order was incorporated in the Corrected Order.
I.
On review, the claimant first contends the Corrected Order is erroneous insofar as it modifies the July 31 order by deleting all findings and conclusions pertaining to the issue of MMI. The claimant asserts the issue of MMI was implicitly raised by his application for hearing on the issue of medical benefits. We conclude the ALJ’s ruling on this issue is not final and reviewable.
Section 8-43-301(2), C.R.S. 2001, provides that any dissatisfied party may seek review of an order “which requires any party to pay a penalty or benefits or denies the claimant any benefit or penalty.” Orders which do not meet these criteria are interlocutory and not subject to immediate review. Natkin Co. v. Eubanks, 775 P.2d 88 (Colo.App. 1989). Under this statute an order must be one that finally disposes of the issue presented, and an order remanding an issue to the ALJ for further findings is not “final.” Bestway Concrete v. Industrial Claim Appeals Office, 984 P.2d 680 (Colo.App. 1999); United States Fidelity and Guaranty, Inc. v. Kourlis, 868 P.2d 1158 (Colo.App. 1994). An ALJ’s order may be final and reviewable concerning some issues and interlocutory as to other issues. Oxford Chemicals, Inc. v. Richardson, 782 P.2d 843 (Colo.App. 1989).
The effect of the Corrected Order was to determine that the issue of MMI after the worsening of condition was not before the ALJ and is subject to further litigation. Thus, the ALJ concluded the issue of MMI after the worsening has not been finally adjudicated and additional evidence may be submitted on this issue. It follows that the Corrected Order does not dispose of the issue of MMI, or the related issue of whether temporary disability benefits should cease. See § 8-42-105(3)(a), C.R.S. 2001. Thus, there is no final and reviewable order on the issue of MMI. Cf. Bestway Concrete v. Industrial Claim Appeals Office, supra. The correctness of the ALJ’s conclusion that MMI was not properly before him at the time of the July 31 order may be reviewed once the issue of MMI is resolved by another order. Finally, the ALJ’s determination that the issue of MMI was not properly before him does not, standing alone, deny the claimant further benefits, nor does it require the respondents to pay additional benefits.
II.
The claimant next contends the ALJ erred in denying penalties under § 8-43-304(1) based on Pinnacol’s alleged violation of the prior authorization procedures established by Rules of Procedure XVI (I) and (J). Because we agree with the ALJ that the claim for penalties is barred by the statute of limitations contained in §8-43-304(5), we do not address the ALJ’s alternative ruling, nor the Stern respondents’ other arguments in support of the ALJ’s order.
Section 8-43-304(5) provides as follows:
A request for penalties shall be filed with the director or administrative law judge within one year after the date that the requesting party first knew or reasonably should have known to facts giving rise to a possible penalty. (Emphasis added).
The claimant does not dispute the ALJ’s findings of fact that the claimant knew or reasonably should have known of the alleged violations of Rule XVI (I) and (J) in April 1998, shortly after the adjuster issued the April 22 letter denying prior authorization for the surgery. Indeed, the record indicates the adjuster’s April 22 letter was not mailed within 5 days of the request for prior authorization, nor did the letter contain the name and professional credentials of the person performing the medical review, nor a copy of the completed medical review. See
Rule XVI (J) (1) (a) and (2)(b). Neither does the claimant dispute that no “request” for penalties was made until February 2000 when the application for hearing was filed. Instead, relying on § 8-43-305, C.R.S. 2001, the claimant argues that each day the adjuster failed to comply with the rule constituted a “separate and distinct violation” of the rules of procedure. Therefore, the claimant asserts Pinnacol “remained in violation of the Director’s regulations and [is] subject to penalties for the violation that fell well within the one year statute of limitations.” (Claimant’s Brief at p. 9.)
We recently rejected a similar argument in the case o Spracklin v. Supervalu, W.C. No. 4-417-697 (January 16, 2002). In Spracklin, the claimant, citing § 8-43-305, argued the ALJ misconstrued section 8-43-304(5) “to require the filing of the request for penalties within one year of the insurer’s initial violation even if there is a continuing violation.” In resolving this contention we applied the standard rule of statutory construction that words and phrases in statutes should be given their “plain and ordinary meanings.” See Snyder Oil Co. v. Embree, 862 P.2d 259 (Colo. 1993). Using a standard dictionary definition, we concluded that the statutory term “first” means “coming before all others, or earliest in time.” Cf. White v. Industrial Claim Appeals Office, 8 P.3d 621 (Colo.App. 2000) (in absence of a specific definition, word will be given its commonly accepted dictionary definition). Consequently, we held that “section 8-43-304(5) requires a request for penalties to be filed within one year after the requesting party first became aware of the circumstances which constitute a violation and support the imposition of a penalty, even if that violation was ongoing.”
In addition, we now note that section 8-43-304(5) requires the filing of a request for penalties upon the first notice of “facts” giving rise to a “possible penalty.” The term “possible” connotes something which is “capable of existing, happening, or being true without contradicting proven facts, laws, or circumstances.” Webster’s II New College Dictionary (1995). Thus, the plain and ordinary meaning of section 8-43-304(5) is that a party must file a request for penalties within one year of learning facts which give rise to a
penalty and conceivable penalties based on continuing violations attributable to the original misconduct. Indeed, § 8-43-305
itself contemplates “cumulative” violations and provides that such violations may be joined in any action to enforce a penalty based on the original misconduct.
Here, the claimant first gained knowledge of the alleged violation of Rule XVI in April 1998. Further, the claimant must have known that until such violation was remedied it was “possible” Pinnacol could be liable for penalties of up to $500 per day. Nevertheless, the claimant did not file a request for penalties until almost two years after gaining knowledge of the “facts” giving rise to the “possible” penalties. Thus, in light of our interpretation of § 8-43-304(5), the ALJ correctly applied the statute of limitations and denied the claim for penalties.
IT IS THEREFORE ORDERED that the claimant’s petition to review the Corrected Order dated August 29, 2001, is dismissed without prejudice insofar as the Corrected Order determined the issue of MMI was not before the ALJ.
IT IS FURTHER ORDERED that the Corrected Order is otherwise affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2001. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed March 25, 2002 to the following parties:
Russell Robey, David Koppold, 3008 13th Ave., Council Bluffs, IA 51501-5776
Jack Stern a/k/a Stern Properties, 5460 E. Kentucky Ave., Denver, CO 80246-2334
Mike Egan Kathy Egan d/b/a Express Personnel, 1135 8th Ave., Greeley, CO 80631
Curt Kriksciun, Esq., Colorado Compensation Insurance Authority d/b/a Pinnacol Assurance — Interagency Mail (For Respondents)
Chris L. Ingold, Esq., 501 S. Cherry St., #500, Denver, CO 80246 (For Claimant)
Ronda K. Comings, Esq., 2629 Redwing Rd., #330, Ft. Collins, CO 80526
Lisa A. Simons, Esq., 600 17th St., #1600N, Denver, CO 80202
BY: A. Pendroy