W.C. Nos. 4-609-400, 4-609-400.Industrial Claim Appeals Office.
September 21, 2006.
FINAL ORDER
The respondents seek review of an order dated August 17, 2005, as well as a supplemental order dated April 17, 2006, of Administrative Law Judge Felter (ALJ) that imposed penalties against the respondents. We find the supplemental order to be void and set aside the assessment of penalties.
This claim involved several issues, which were bifurcated for hearing. The ALJ held a hearing on June 21, 2005, to consider the claimant’s entitlement to certain medical benefits and, also, whether the respondents were subject to penalties concerning the actions of the insurer’s adjustor in regard to the claimant’s medical treatment. The ALJ’s award of medical benefits to the claimant is not contested.
I.
Initially, we consider the matter of the ALJ’s supplemental order. The ALJ issued his Findings of Fact, Conclusions of Law, and Order (Order), which was mailed to the parties on August 18, 2005. The respondents appealed the Order and the last brief was filed on February 17, 2006. The ALJ issued a supplemental order dated April 17, 2006, that was mailed to the parties on April 18, 2006. Section 8-43-301(4), C.R.S. 2006, provides that a briefing schedule shall be issued once the record is complete, giving notice to the petitioner that a brief in support of the petition to review is due in 20 days and to the opposing party that a brief in opposition is then due 20 days after the date of the certificate of mailing of the petitioner’s brief. The statute then states that “[a]fter the briefs are filed or the time for filing has run, the director or administrative law judge shall have thirty days to enter a supplemental order or transmit the file to the industrial claim appeals office for review.”
The parties are in agreement, and the record reflects, that the supplemental order was issued beyond the 30-day time limit set by statute. Accordingly, the ALJ was without jurisdiction to enter that order and it is void. It is well established that the time period within which to enter a supplemental order is jurisdictional, and the ALJ’s failure to enter the order within thirty days transfers jurisdiction to the Industrial Claim Appeals Office. Hillebrand Construction Company v. Worf, 780 P.2d 24 (Colo.App. 1989). The ALJ’s jurisdiction to enter a supplemental order is purely statutory and may not be conferred by waiver, consent, or any other equitable principle. Gardner v. Friend, 849 P.2d 817 (Colo.App. 1992). The ALJ’s Order dated August 17, 2005, is therefore the only decision before us for review on the merits.
II.
In addition to seeking medical benefits, the claimant sought penalties against the respondents. The claimant’s application for hearing indicates that penalties were sought against the respondents for dictating medical care in violation of §8-43-503(3), C.R.S. 2006. The respondents requested a more definite statement from the claimant seeking more specific averments in support of her claim for penalties. The claimant subsequently asserted that the respondent’s adjustor, Ms. Norris, manipulated the claimant’s medical treatment through a course of communications with treating physicians. She further alleged that the adjustor’s communications with Drs. Johnson, Bohachevsky, and Silva, resulted in the treatment to be provided by Dr. Bohachevsky being transferred to and provided by Dr. Silva. Claimant’s Brief at 4. (The motion for more definite statement and the claimant’s response were not located in the record; however, there does not appear to be any dispute as to the accuracy of the claimant’s recitation of her response to the motion.) In the Order, the ALJ recited the claimant’s assertion that the adjustor “was able to manipulate medical treatment so Dr. Bohachevsky’s treatment was not provided to the Claimant and the Claimant’s physiatry care was transferred to Dr. Silva.” Order at 2.
The ALJ’s Order contains extensive findings as to the adjustor’s course of conduct and the corresponding history of claimant’s medical care. The gist of the matter appears to be that the adjustor inundated various treating physicians with requests for information, upon which treatment authorization was sometimes made contingent. The claimant’s medical care included a course of injections, some of which, the ALJ found, were ultimately administered by Dr. Silva. Order at 18, ¶ 43. The ALJ found that “Norris further micro-managed Claimant’s medical care and treatment to the pointing [sic] of inversely dictating medical treatment by wearing the medical providers down with pyramiding requests for more and more documentation of what was already there for Norris.” Order at 11, ¶ 24. However, concerning the claimant’s specific allegations of the adjustor manipulating the medical care, the ALJ determined that the “Claimant has not established that Norris dictated medical care, or forced a referral to . . . Dr. Silva.” Order at 20, ¶ c.
Nonetheless, the ALJ determined that the adjustor’s delay in authorizing the injections was unreasonable and negligent. He therefore imposed penalties based on the period of the delay. Order at 20-21, ¶¶ i, k. In assessing penalties, the ALJ cited § 8-433-04, C.R.S. 2006, which may authorize penalties for the violation of a statute or rule. The ALJ commented that the rules required an insurer not to delay treatment by an authorized treating physician. He further noted that, for questions about medical treatment, an insurer should request a utilization review pursuant to § 8-43-503(3), the statute cited by the claimant in support of her claim for penalties. Order at 21, ¶ j. He therefore assessed penalties against the respondents for “negligent violation of the Rules with respect to the . . . injections, and the denial and delay thereof.” Order at 22, ¶ B.
Section 8-43-304(4) provides that an application for penalties under § 8-43-304(1) “shall state with specificity the grounds on which the penalty is being asserted.” We have previously determined that the requirement for specificity serves two functions. First, it notifies the putative violator of the basis of the claim so that violator may exercise its right to cure the violation. Further, the specificity requirement insures the violator will receive notice of the legal and factual bases for the penalty claim so that the violator’s rights to present evidence, confront adverse evidence, and present argument in support of its position are protected. See Major Medical Insurance Fund v. Industrial Claim Appeals Office, 77 P.3d 867, 870 (Colo.App. 2003) (when adjudication turns on questions of fact parties are entitled to notice of evidence to be considered and afforded reasonable opportunity to confront adverse evidence, present evidence, and make argument); Gonzales v. Denver Public School District No. 1, W.C. No. 4-437-328 (December 27, 2001) (ALJ properly denied penalties against employer for violation of Rule XI (B)(3) where response to application did not indicate claimant was seeking penalties against the employer); cf. Shaw v. Valdez, 819 F.2d 965 (10th Cir. 1987) (in unemployment insurance case parties entitled to notice of factual and legal issues to be adjudicated at hearing).
In this case, § 8-43-503(3) provides the specific statutory basis for the claimant’s request for penalties under § 8-43-304. The claimant alleged no violation of a specific rule. Section 8-43-503(3) has been construed to preclude an insurer’s representative from issuing commands to a treating physician as to the type of treatment to be provided to a claimant. See York v. Larchwood Inns, W.C. No. 4-365-429 (November 7, 2002). The ALJ found many examples of what he determined to be inappropriate activity on the part of the adjustor; however, he specifically determined that the claimant failed to sustain her burden of establishing that the adjustor dictated medical care or a referral to Dr. Silva, as specifically alleged by the claimant. Under the circumstances, the claimant’s request for penalties must fail. Moreover, even though the ALJ referred to §8-43-503(3) when discussing the available option of contesting medical care through utilization review, that analysis is inapposite to the issue of whether the respondents’ agent effectively dictated medical treatment as specifically alleged by the claimant.
In our view, the claimant’s reliance on Pena v. Industrial Claim Appels Office, 117 P.3d 84 (Colo.App. 2004) is misplaced. In Pena, the Colorado Court of Appeals approved imposition of general penalties under § 8-43-304 where the insurer failed to provide medical care and treatment and another statute, §8-43-401(2)(a), C.R.S. 2006, did not specifically provide a corresponding penalty. In the present case the claimant sought penalties for alleged dictating of medical care in violation of §8-43-503(3). Generally, the imposition of penalties under §8-43-304(1) requires a two step analysis. First it must be determined whether a party has violated the Act in some manner, or failed to carry out a lawfully enjoined action, or violated an order. Allison v. Industrial Claim Appeals Office, 916 P.2d 623
(Colo.App. 1995). If a violation is found, it must be determined whether the violator acted reasonably. The conduct at issue is measured by an objective standard of reasonableness, and whether the conduct was reasonable is a question of fact for the ALJ Pioneers Hospital v. Industrial Claim Appeals Office, 114 P.3d 97, 99 (Colo.App. 2005). Here, the ALJ specifically found that the claimant had not established the threshold requirement that the insurer dictated medical care in violation of § 8-43-503(3). Therefore, the insurer did not violate § 8-43-503(3) the specific ground alleged by the claimant and so can not be used to support imposition of penalties under the general penalty statute §8-43-304(1).
As noted previously the supplemental order was entered beyond the applicable statutory time period and is, therefore, void.
IT IS THEREFORE ORDERED that the supplemental order dated April 17, 2006, is vacated.
IT IS FURTHER ORDERED that the penalty award contained in the ALJ’s order dated August 17, 2005, is set aside.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ John D. Baird
____________________________________ Thomas Schrant
Sharon George, 695 Camino Iglesia, Durango, CO, Toni Martinez, T M, Inc., Durango, CO, Rhonda Norris, State Farm Fire
Casualty Co., Lakewood, CO, Brenda Carrillo, Subsequent Injury Fund, Division of Workers’ Compensation — Interagency mail, Robert C. Dawes, Esq., Durango, CO, (For Claimant).
Cheryl A. Martin, Esq., Grand Junction, CO, (For Respondents).