JOSUE M. GALDAMEZ, Employee/Appellant, v. KENNEDY TRANSMISSION and WESTERN NAT=L. INS. GROUP, Employer-Insurer, and UNITED HOSP., UNITED PAIN CTR., ST. PAUL RADIOLOGY, MIDWEST SPINE INST., MEDICA/INGENIX, and ASSOCIATED ANESTHESIOLOGISTS, Intervenors.
WORKERS= COMPENSATION COURT OF APPEALS
JULY 5, 2007
ATTORNEY FEES - RORAFF FEES. Where all issues before the compensation judge in the current proceeding were issues of medical benefits left open by a previous full, final, and complete settlement, where there was no petition for attorney fees yet before the judge, where the judge awarded payment of some of the medical expenses at issue to two intervenors and did not in any way support her finding denying attorney fees, the compensation judge=s apparently legal conclusion that the employee=s attorney was Anot entitled to attorney=s fees on payments made to intervenors@ was reversible error.
Determined by Pederson, J., Johnson, C. J., and Rykken, J.
Compensation Judge: Janice M. Culnane
Attorneys: Ross K. Menk, Law Offices of Donald F. Noack Jr., Mound, MN, for the Appellant. Michael Aafedt and Radd Kulseth, Aafedt, Forde, Gray, Monson & Hager, Minneapolis, MN, for the Respondents.
WILLIAM R. PEDERSON, Judge
The employee appeals from the compensation judge's denial of Roraff attorney fees for medical expenses recouped on behalf of two intervenors. We reverse.
On March 5, 2004, Josue Galdamez [the employee] sustained an injury to his low back in the course of his work as a mechanic with Kennedy Transmission [the employer]. He was seen in the emergency room at Regions Hospital on the date of his injury, and three days later he was seen back at Regions by physician=s assistant May Mua, to whom he complained of sharp, burning low back pain with numbness that shot down his left leg and sometimes became so severe that he could not walk. The employee was referred eventually to Midwest Spine Institute, where Dr. Thomas Rieser restricted the employee from working for a month, prescribed medications and a series of epidural steroid injections, and ordered a myelogram/CT scan. The scan was conducted on March 26, 2004, and was read to reveal a small disc bulge at L5-S1, without thecal sac or nerve root impingement, and a minimal bulge at L4-5, without foraminal encroachment. About a month later, on April 23, 2004, Dr. Rieser performed a discectomy at L4-5 of the employee=s spine, to repair a disc herniation at that level.
On June 2, 2004, at the request of his former attorney, Carl Sommerer, the employee underwent an independent medical examination by orthopedist Dr. Robert Wengler, who assessed low back pain and left lower extremity sciatica, probably discogenic in origin. Based on available information, Dr. Wengler concluded in a report to Mr. Sommerer that the employee could be subject to at least a 14% whole-body impairment but was not yet at maximum medical improvement.
On November 10, 2004, Dr. Rieser=s physician=s assistant indicated that he Awould not anticipate any further surgical intervention, which would most likely not improve [the employee=s] current symptoms.@ A second opinion by Dr. Joseph Perra on November 22, 2004, was in agreement that the employee Awould be best controlled from a pain management standpoint at this point in time,@ and on December 23, 2004, in a third party consultation, Dr. Fozia Abrar agreed. On February 22, 2005, following another MRI scan that revealed little new, Dr. Rieser ordered another discogram and discussed the option of fusion surgery with the employee, explaining that the latter was Aan absolute last resort.@ The discography, conducted on March 11, 2005, was found to be unreliable, Dr. Rieser explaining on March 18, 2005, that the discogram had revealed painful discs at all levels while morphology was normal at all but two. ABased on this and the hypersensitivity, [the employee=s] overall approach, and his reaction to pain,@ Dr. Rieser concluded that the employee was not currently a surgical candidate, and he referred the employee to the Sister Kenny chronic pain program.
On March 22, 2005, still represented by Mr. Sommerer, the employee entered into a full, final, and complete settlement with the employer and insurer of all claims related to the employee=s March 5, 2004, work injury other than ones for future medical expenses, and an award on that settlement was filed on March 25, 2005.
On May 10, 2005, the employee was examined at United Hospital by Dr. Kristine Spiewak, on referral from Dr. Rieser for recommendations regarding chronic pain and rehabilitation. Upon a thorough review of the employee=s medical and social history and completion of a physical examination, Dr. Spiewak concluded that the employee had Aa poor prognosis for improving his symptoms,@ and she agreed with Dr. Rieser=s assessment, that the employee Awould best be served by a chronic pain management program which included a behavioral and psychological support system.@ The employee returned twice more to Dr. Spiewak, on May 25 and July 6, 2005, with tangential complaints that he believed were related to his back problems, but Dr. Spiewak continued to recommend essentially only that the employee continue to pursue a chronic pain program.
On September 13, 2005, the employee returned to Dr. Rieser, reporting that he had been seen three times by doctors at Sister Kenny and that they had been unable to help him, but Dr. Rieser continued to recommend only chronic pain management and psychological counseling. On December 23, 2005, the employee retained his current attorney, Ross K. Menk, to represent him in securing payment for ongoing medical treatment.
On January 17, 2006, the employee sought treatment with spine surgeon Dr. Manuel Pinto at Twin Cities Spine for complaints of persistent moderate to severe low back pain, a bilateral lower extremity burning sensation, neck pain, and bilateral arm pain. Dr. Pinto ordered discograms at six levels of the employee=s lumbar and thoracic back, which were conducted on January 27, 2006. The insurer denied payment for the studies. On February 28, 2006, Dr. Pinto noted that the discograms were Acertainly valid,@ with no pain registering at the morphologically normal disc, T12-L1, and with severe concordant pain registering at the morphologically abnormal discs at L1-2, L4-5, and L5-S1, which were torn. Dr. Pinto ordered an intradiscal injection at L1-2, Ato see if that takes away most of his symptoms,@ and he discussed surgical options with the employee in the event of a poor result. On March 6, 2006, the employee filed a medical request, seeking payment of certain outstanding medical expenses. On April 20, 2006, with the employee=s pain apparently unrelieved, Dr. Pinto proposed a Acombined anterior/posterior fusion at L1-2, L4-5 and L5-S1" involving two separate anterior incisions, cautioning that the employee Ashould only proceed with surgical treatment if his symptoms [are] severe, unrelenting and unresponsive to conservative care.@ The employee indicated that he wanted to go ahead with the surgery, and on June 6, 2006, he amended his medical request, alleging entitlement to payment for the surgery recommended by Dr. Pinto and also to payment of outstanding medical expenses incurred at Twin Cities Spine Center and United Pain Center.
On September 6, 2006, the employee was examined for the employer and insurer by orthopedic surgeon Dr. William Simonet, who diagnosed chronic pain syndrome, which he characterized as Aessentially a psychological diagnosis,@ together with minor degenerative disc disease and obesity, Abut nothing of any severity.@ It was Dr. Simonet=s opinion that the employee=s March 2004 work injury did not cause the employee=s current spinal condition and that the surgery currently recommended by Dr. Pinto was not reasonable and necessary. He concluded further that the employee=s care and treatment at United Hospital, United Pain Center, and Courage Center had been excessive and that A[s]uch care is only tended to patronize the patient and encourage pain behavior.@ Dr. Simonet concluded that the more appropriate management of the employee=s case would be to wean him of narcotics and to engage him in an exercise and fitness program. It was also Dr. Simonet=s opinion, finally, that the employee Ahas obvious psychological conditions which are leading to his symptoms being way out of proportion to objective physical findings.@
In a letter to Mr. Menk dated September 26, 2006, Dr. Pinto opined that the employee=s current symptoms were related to the employee=s March 2004 work injury and that the fusion surgery being recommended was Aa reasonable and necessary form of treatment to try to alleviate [the employee=s] current persistent severe low back pain.@ Dr. Pinto explained that the employee Aunderstands that [the surgery] is elective and he should proceed with surgical treatment only if his symptoms are indeed severe, unrelenting, and have failed extensive conservative care.@ In a follow-up report a week later, after review of Dr. Simonet=s report, Dr. Pinto questioned Dr. Simonet=s expertise to be drawing conclusions in matters of spinal surgery and psychiatric issues. He noted that it was his own experience, having performed spine surgery exclusively for sixteen years, Athat when patients have responses to discograms like [the employee] had, they usually don=t have symptom amplification.@ With regard to the employee=s alleged psychological contra-indications to surgery, Dr. Pinto indicated that he Awould put that in the hands of a competent professional and let them decide.@
The matter came on for hearing on October 6, 2006. In attendance at the hearing were the employee, Mr. Menk, the employer and insurer=s attorney, and Kristie Grabowski, a representative for Medica/Ingenix, which had been granted intervention status along with five other intervenors. Ms. Grabowski, who was introduced by the compensation judge as Aone of the intervenors,@ offered into evidence a summary itemizing medical payments made by Medica/Ingenix on behalf of the employee in the amount of $16,110.53. Among the other five parties intervening in the matter was Midwest Spine Institute, on grounds that it had provided the employee with medical services in the amount of $18,871.00. Issues at hearing included the following: (1) whether the six intervenors were entitled to payment or reimbursement of a total of $42,171.80 in medical expenses incurred or paid on behalf of the employee; (2) whether $2,391.00 in pool therapy treatment expenses at Courage Center in October through December of 2005 were reasonable, necessary, and causally related to the employee=s work injury; (3) whether the anterior/posterior fusion at L1-2, L4-5, and L5-S1 being proposed by Dr. Pinto was reasonable, necessary, and causally related to the employee=s work injury; and (4) whether the employee was entitled to attorney fees.
At Order 1 of her findings and order filed November 6, 2006, the compensation judge awarded Athe medical expenses at Midwest Spine Institute,@ having found at Finding 11 that AMidwest Spine Institute has intervened for medical bills paid on behalf of the employee of $18,871.00.@ At Order 2 of her decision, the judge awarded to Medica/Ingenix the Amedical expenses in Finding No. 8,@ in which finding the judge had itemized, out of the total of $16,110.53 in expenses that Medica/Ingenix had claimed reimbursement for paying on behalf of the employee, $4,731.00 in expenses as reasonable, necessary, and causally related to the work injury. These expenses that were ordered to be reimbursed all related to treatment and examination from March 5 through December 19, 2004, at Regions Hospital and by Dr. Perra. The judge denied all other treatment claims, including payment for the surgery proposed by Dr. Pinto and payment for the pool therapy at Courage Center. The judge issued no order regarding the attorney fees issue, but at Finding 12, asserting that A[t]he employee herein has entered into a reasonable contingent fee agreement with Attorney Menk pursuant to Minn. Stat. ' 176.081,@ she had concluded that A[a]ttorney Menk is not entitled to attorney=s fees on payments made to intervenors.@ The judge did not address her finding on the attorney fees issue in her memorandum. The only issue here on appeal is the judge=s conclusion as to attorney fees in Finding 12.
STANDARD OF REVIEW
A[A] decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which [the Workers= Compensation Court of Appeals] may consider de novo.@ Krovchuk v. Koch Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993).
Other than Mr. Menk=s entitlement to attorney fees, the sole issues at hearing below were payment for the surgery proposed by Dr. Pinto, payment of $2,391.00 to Courage Center for pool therapy in 2005, and payment of outstanding medical expenses alleged to total $42,171.80, either incurred at or paid by six different intervenors, including $18,871.00 allegedly payable to intervenor Midwest Spine Institute, mostly for the treatment of Dr. Rieser, and $16,110.53 allegedly reimbursable to intervenor Medica/Ingenix. The compensation judge ultimately awarded only payment of Athe medical expenses at Midwest Spine Institute@ and reimbursement to Medica/Ingenix of specifically $4,731.00 plus interest, mostly for the employee=s initial treatment at Regions Hospital in 2004. At Finding 12, the compensation judge concluded that A[t]he employee herein has entered into a reasonable contingent fee agreement with Attorney Menk pursuant to Minn. Stat. ' 176.081" and, notwithstanding Mr. Menk=s success in recouping payment and reimbursement to Midwest Spine Institute and Medica/Ingenix, that A[a]ttorney Menk is not entitled to attorney=s fees on payments made to intervenors.@ The judge made no explanation of this finding, in her memorandum or elsewhere. Noting that no indemnity benefits were at issue at the hearing, only medical benefits, all indemnity issues having been resolved by the March 25, 2005, award on settlement prior to Mr. Menk=s representation in the case, the employee contends that there are no monetary benefits paid to the employee from which Mr. Menk can be paid a contingent fee to compensate him for his work in securing the medical benefits here awarded. Citing this court=s decision in Karst v. Anoka Hennepin Independent School District #11, he argues that Mr. Menk is entitled to a Roraff attorney fee for his efforts= direct effect on successfully securing reimbursement to two intervenors who had issued care to or made payment on behalf of the employee. Cf. Karst v. Anoka Hennepin Indep. Sch. Dist. #11, slip op. (W.C.C.A. June 5, 2003). In response, the employer and insurer initially argue, quoting essentially from the supreme court=s decision in Barnick v. Swift Eckrich, Inc., that attorney fees are payable Aonly on compensation benefits paid to the employee as distinguished from medical benefits.@ Barnick v. Swift Eckrich, Inc., 442 N.W.2d 294, 295, 41 W.C.D. 1183, 1184 (Minn. 1989), citing Johnson v. Blue Cross & Blue Shield of Minnesota, 329 N.W.2d 49, 53 (Minn. 1983). They argue further that attorney fees might be payable on recouped medical expenses only when the Aemployer fails to provide medical services or expenses incurred by or on behalf of the employee,@ contending that here Athe benefits granted were solely for the intervention interests of Midwest Spine and Ingenix/Medica@ and Awere not expenses incurred by or on behalf of the employee.@ They argue finally that Athere is no indication in the record that attorney Menk expended any time in proving the intervention interests of Ingenix/Medica and Midwest Spine,@ and that AIngenix/Medica was represented prior to and at the hearing by representative Kristie Grabowski.@ We are unpersuaded by the employer and insurer=s arguments and agree with the employee that his attorney should not have been denied attorney fees.
The issue in the Barnick case was clearly distinguishable from that in the instant case. In Barnick, the issue was whether the employee=s attorney was entitled to an attorney fee paid by the intervenor Afrom the medical expense reimbursement,@ based on the statutory fee formula. Barnick, 442 N.W.2d at 295, 41 W.C.D. at 1184. The basis of the court=s holding in that case was the basic statutory principle that an injured worker=s medical expenses, if found to be reasonable and necessary and causally related to the work injury, should be paid by the employer and insurer, without cost to the intervenor. The statutory provisions for payment of attorney fees incurred in the securing of that payment of medical expenses do not, Barnick implies, impose any obligation on an intervenor, only on either an employee - - in the case of a contingent fee paid out of indemnity benefits - - or sometimes an employer and insurer - - in the case of substantial medical benefits. Indeed, if anything, Barnick argues contrary to the position of the employer and insurer in the present case.
Nor can we agree with the employer and insurer=s argument that this case is somehow distinguishable from Roraff on the basis that here Athe benefits granted were solely for the intervention interests of Midwest Spine and Ingenix/Medica@ and Awere not expenses incurred by or on behalf of the employee.@ The medical treatment paid for or provided by these two intervenors was clearly furnished to the employee to cure and relieve him from the effects of his work injury. The compensation judge found that treatment to be reasonable, necessary, and causally related to the employee=s work injury and thus the responsibility of the employer and insurer. Here, the employee was required to commence a proceeding to obtain payment of the cost of his medical treatment. Having prevailed before the compensation judge, the employee=s attorney is entitled to a fee.
Noting that the judge does not in any way explain her simple, apparently legal finding on the issue anywhere in her decision, we hold legally erroneous, and so reverse, the compensation judge=s conclusion that A[a]ttorney Menk is not entitled to attorney=s fees on payments made to intervenors.@
 See Roraff v. State, Dep't of Transp., 288 N.W.2d 15, 32 W.C.D. 297 (Minn. 1980), as codified with limitations at Minn. Stat. ' 176.081, subd. 1(a)(1). Our use of ARoraff@ as a descriptive term in this decision embraces any attorney fee for recoupment of medical expenses, whether hourly based under case law or formula-based under the statute.
 The six intervenors and their claims were as follows: (1) United Hospital for $5,986.23; (2) United Pain Center for $905.00; (3) Saint Paul Radiology for $242.00; (4) Midwest Spine Institute for $18,871.00; (5) Medica/Ingenix for $16,110.53; and (6) Associated Anesthesiologists for $57.04.
 The employer and insurer cite Roraff, 288 N.W.2d at 16, for this language, but we find it nowhere in the case, although the principle is essentially correct.