W.C. No. 4-441-620Industrial Claim Appeals Office.
June 15, 2001
FINAL ORDER
The pro se claimant seeks review of an order of Administrative Law Judge Martinez (ALJ Martinez) which denied medical benefits in the form of treatment provided by Dr. Ellen Woefel-Price (Dr. Price), and penalties based on for the respondents’ alleged violation of an order dated April 26, 2000. We affirm the denial of medical benefits, set aside the order concerning penalties, and remand for entry of a new order concerning penalties.
On October 24, 1999, the claimant suffered a compensable injury. The injury was treated by Dr. Huene. On February 8, 2000, Dr. Huene wrote a prescription for the claimant to see Dr. Price for an “MMI eval.” After the evaluation Dr. Price continued to treat the claimant.
In an order dated April 26, 2000, ALJ Kozelka determined Dr. Huene placed the claimant at maximum medical improvement (MMI) on February 8, 2000, and referred the claimant to Dr. Price for an impairment evaluation. ALJ Kozelka ordered the respondents to pay:
“all Claimant’s medical expenses reasonably necessary to cure and relieve the effects of her work-related injury, including without limitation all expenses incurred to the date of hearing, . . . . . and all further costs of reasonably necessary medical treatment and the cost of impairment evaluation, as rendered by Dr. Huene, Dr. Price, or any other authorized provider. “
ALJ Kozelka awarded accrued medical benefits of $3070.70 plus $48.30 in mileage. She also awarded temporary partial disability benefits of $1,147.07, and penalties of $649.20 (50 percent to the claimant) for failing timely to admit or deny liability. Finally, ALJ Kozelka found that respondents Charles Berardi (C.B.) and James Berardi (J.B.) are jointly and severely liable for the award.
Neither C.B. nor J.B. appealed ALJ Kozelka’s April 26 order. Thereafter, these respondents failed to pay the temporary partial disability benefits and mileage reimbursement benefits awarded by ALJ Kozelka. The respondents also refused to pay for the treatment provided by Dr. Price, except a $280 prepayment for the impairment evaluation. Consequently, the claimant applied for a hearing on the issues of medical benefits and penalties for non-compliance with ALJ Kozelka’s order.
ALJ Martinez found Dr. Huene’s prescription was a limited referral for purposes of conducting an evaluation to assess the claimant’s permanent medical impairment and did not authorize Dr. Price to provide additional treatment. Therefore, ALJ Martinez determined the respondents are not liable for treatment which the claimant received from Dr. Price subsequent to the “MMI” evaluation.
Further, ALJ Martinez determined that the “employer” made “good-faith efforts” to comply with the April 26 order and stated an intention to commence direct payments to the claimant for the balance of payment required by the April 26 order. Under these circumstances, ALJ Martinez denied the claimant’s request for penalties.
I.
On review the claimant contends the intent of ALJ Kozelka’s order was to require the respondents to pay for all reasonably necessary post-MMI treatment rendered by Dr. Price, or any other authorized provider. Further, the claimant contends the respondents received medical bills for Dr. Price’s treatment and never denied the treatment was authorized. Therefore, the claimant contends the ALJ erroneously failed to order the respondents to pay for Dr. Price’s treatment. We disagree.
Initially, we note that our review is limited to the record before the ALJ. City of Boulder v. Dinsmore, 902 P.2d 925 (Colo.App. 1995). Therefore, we have not considered the documents attached to the claimant’s brief in support of the petition to review. See Voisinet v. Industrial Claim Appeals Office, 757 P.2d 171 Colo. App. 1988)
The respondents are liable for all authorized and emergency treatment reasonably necessary to cure or relieve the effects of the industrial injury. Sims v. Industrial Claim Appeals Office, 797 P.2d 777
(Colo.App. 1990). Section 8-42-101(1), C.R.S. 2000. “Authorization” and the reasonableness of treatment are separate and distinct issues. See One Hour Cleaners v. Industrial Claim Appeals Office, 914 P.2d 501
(Colo.App. 1995). “Authorization” refers to the physician’s legal status to treat the injury at the respondents’ expense, and not the particular treatment provided. Popke v. Industrial Claim Appeals Office, 944 P.2d 677
(Colo.App. 1997).
A physician who commences to treat the industrial injury upon a referral made in the “normal progression of authorized treatment” becomes an authorized treating physician. Bestway Concrete v. Industrial Claim Appeals Office, 984 P.2d 680 (Colo.App. 1999);Greager v. Industrial Commission, 701 P.2d 168 (Colo.App. 1985). However, a referral can be limited in scope. See Gail v. U.S. West Service Link, Inc., W.C. No. 3-957-994 (June 18, 1991), aff’d., Gail v. U.S. West Service Link, Inc., (Colo.App. No. 92CA1107, June 3, 1993) (not selected for publication) Benien v. Color Star Growers of Colorado Inc., W.C. No. 4-226-236 (April 29, 1998); Gamboa v. ARA Group, Inc., W.C. No. 4-106-924 (November 20, 1996).
The scope of the referral is a question of fact for resolution by the ALJ. City of Durango v. Dunagan, 939 P.2d 496 (Colo.App. 1997); Suetrack USA v. Industrial Claim Appeals Office, 902 P.2d 854 (Colo.App. 1995). Consequently, we are bound by the ALJ’s determination if supported by substantial evidence and plausible inferences drawn from the record. Section 8-4-301(8), C.R.S. 2000; Suetrack USA v. Industrial Claim Appeals Office, supra; Smith v. Aspen Skiing Company, W.C. No. 3-071-413, (December 21, 1993).
Here, the ALJ determined Dr. Huene’s February 8 “prescription” was not a general referral to Dr. Price, and that Dr. Price was only authorized to perform an evaluation of the claimant’s permanent medical impairment. The ALJ’s inference is a plausible interpretation of Dr. Huene’s February 8 prescription and, therefore, is binding on review. Furthermore, the claimant admitted she had no authorization to treat with Dr. Price. (Tr. p. 18). Thus, the ALJ did not err in finding the respondents are not liable for the treatment provided by Dr. Price.
Moreover, we reject the claimant’s contention that the ALJ’s order is inconsistent with the April 26 order of ALJ Kozelka. The employer’s obligation to provide medical benefits terminates when the claimant reaches MMI. This is true because MMI is defined as the point in time when the claimant’s condition is “stable and no further treatment is reasonably expected to improve the condition.” Section 8-40-201(11.5), C.R.S. 2000. The claimant may only receive medical benefits after MMI if additional treatment is reasonably necessary to maintain MMI or prevent a deterioration of her condition. Grover v. Industrial Commission, 759 P.2d 705 (Colo. 1988). However, the claimant’s entitlement t Grover- type medical benefits cannot be ascertained until the claimant has been determined to be at MMI.
Sections 8-42-107(8)(b)(I) (II), C.R.S. 2000, provide that the initial determination of MMI is to be made by an authorized treating physician. That statute also provides that the ALJ lacks authority to determine the accuracy of the treating physician’s opinion until the claimant has undergone a Division-sponsored independent medical examination (DIME). See Story v. Industrial Claim Appeals Office, 910 P.2d 80 (Colo.App. 1995).
The issues endorsed for adjudication at the March 21 hearing before ALJ Kozelka were compensability, medical benefits, average weekly wage and temporary disability benefits. ALJ Kozelka determined Dr. Huene placed the claimant at MMI on February 8, 2000. (April 26, 2000, Finding of Fact 4). However, ALJ Kozelka did not purport to determine the accuracy of Dr. Huene’s finding of MMI. Under these circumstances, the ALJ reasonably inferred that ALJ Kozelka’s order did not award medical benefits after MMI. Instead, the April 26 award of medical benefits is limited to treatment provided up to the date of MMI.
II.
The claimant also contends the ALJ erroneously refused to impose penalties for the respondents’ failure to comply with April 26 order. Because the ALJ may have applied an incorrect legal standard in assessing the claim for penalties, we set aside the order denying penalties and remand the matter for the entry of a new order.
Under § 8-43-304(1), C.R.S. 2000, the ALJ may impose penalties of up to five hundred dollars per day where an employer fails, neglects or refuses to obey any lawful order made by the panel or director. Holliday v. Bestop Inc. ___P.3d __(Sup.Ct. 99SC742, May 14, 2001). In order to assess a penalty, it must be established that the violator’s conduct was unreasonable under an “objective standard.” Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, 907 P.2d 676
(Colo.App. 1995). This determination depends on whether the party advances a rational argument based in law or fact for its actions Diversified Veterans Corporate Center v. Hewuse, 942 P.2d 1312
(Colo.App. 1997); Pueblo School District No. 70 v. Toth, 924 P.2d 1094
(Colo.App. 1996).
Here, is undisputed that both respondents failed to make the payments required by the April 26 order. Respondent C.B. testified that he couldn’t afford to make a lump sum payment for the claimant’s medical expenses and was unable to obtain a performance bond. Therefore he made some installment payments to the medical providers. (Tr. p. 30). However, he also admitted he did not apply for the performance bond within the time provided by the April 26 order. (Tr. p. 35). Additionally, C.B. stated that his failure to pay the award of temporary disability benefits was attributable to his “negligence” or “carelessness” and ALJ Martinez found C.B. admitted he could have paid these benefits if he had “noticed” ALJ Kozelka’s order required him to pay them. (Tr. pp. 29, 30; Finding of Fact 4). C.B. provided no explanation for his failure to pay the mileage reimbursement award.
The court has held that where the violator provides no “appropriate” explanation of the violation the party’s neglect is not “objectively reasonable.” See Human Resource Company v. Industrial Claim Appeals Office, 984 P.2d 1194 (Colo.App. 1999). The court has reached the same conclusion where the violator’s neglect was attributable to a “mistake.”Diversified Veterans Corporate Center v. Hewuse, supra. Consequently, the ALJ’s finding that C.B.’s failure to pay temporary disability benefits or mileage was due to “inadvertence or oversight” does not establish the conduct was objectively reasonable and provide a legal excuse for C.B.’s failure to obey portions of the April 26 order.
We also note that ALJ Kozelka held the “respondents” jointly and severally liable for the payment of benefits and penalties. Under these circumstances, C.B.’s explanation for his failure to comply with the April 26 order does not support the ALJ’s refusal to impose penalties against J.B. Indeed, J.B. did not appear and offer any explanation for his failure to comply with ALJ Kozelka’s order.
Moreover, C.B.’s financial limitations, “good-faith efforts” and “stated intention” may be evidence of mitigating factors which could serve to reduce the amount of the daily penalty imposed for the failure to comply with the April 26 order. However, that is a separate, and distinct question from whether the respondents unreasonably violated the April 26 order and, thus, are subject to penalties. Lightle v. Sonic Drive In, W.C. No 4-416-066 (June 30, 2000).
Furthermore, we have previously held that imposition of penalties under § 8-43-304(1) is mandatory if the ALJ finds that there has been a violation of the Act or rules, and that violation was not reasonable under an objective standard. Rael v. Debourgh Manufacturing Co., W.C. No. 4-115-551 (February 27, 1998); Marple v. Saint Joseph Hospital, W.C. No. 3-966-344 (September 15, 1995). The rationale for these decisions is that § 8-43-304(1) provides that, if a party establishes the requisite preconditions, the offending party “shall also be punished by a fine of not more than $500 per day for each such offense.” (Emphasis added). This interpretation applies with equal force to penalties predicated on order violations. In these cases, we observed that the word “shall” generally connotes a mandatory requirement, and therefore, ALJs do not have discretion to deny a penalty if a punishable violation has occurred E.g. Hillebrand Construction Co. v. Worf, 780 P.2d 24 (Colo.App. 1989) (word shall connotes a mandatory requirement). However, these decisions also held that the actual amount of any daily penalty, between one cent and five hundred dollars per day, is within the discretion of the ALJ. We adhere to our prior conclusions.
Accordingly, the matter is remanded to ALJ Martinez to enter a new order concerning the imposition of penalties. If ALJ Martinez determines that there was no objectively reasonable basis for violating ALJ Kozelka’s order, he must impose a penalty between one cent per day and $500 per day for each violation.
In view of our remand we do not consider the claimant’s remaining arguments on the issue of penalties.
III.
Finally, the claimant disputes the respondents’ calculation of permanent partial disability benefits in their Final Admission of Liability. However, that issue was not before the ALJ and, therefore, the claimant’s arguments are premature.
IT IS THEREFORE ORDERED that the order of ALJ Martinez dated December 21, 2000, is set aside insofar as it denied penalties and, the matter is remanded to ALJ Martinez for entry of a new order on the issue which is consistent with the views expressed herein. In all other respects the order is 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. 2000. 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 June 15, 2001 to the following parties:
Kathryn Steele, 1219 Centennial Dr., Montrose, CO 81419
Charles James Berardi d/b/a The Divot, 500 S.E. Jay Ave., Cedaredge, CO 81413-9236
Douglas E. Briggs, Esq., 743 Horizon Ct., #100, Grand Junction, CO 81506 (For Respondent)
Kat Pennucci, Special Funds Unit, Tower 2, #630, Division of Workers’ Compensation — Interagency Mail
BY A. Pendroy