ANDREW KONCZAL, Employee, v. HAGE CONSTR. CO. and GENERAL CASUALTY INS. CO., Employer-Insurer/Cross-Appellants, and FAIRVIEW HEALTH SERVS., Intervenor/ Appellant.
WORKERS’ COMPENSATION COURT OF APPEALS
JULY 30, 2009
JURISDICTION - SUBJECT MATTER. An order obligating an employer and insurer to pay the reasonable value of medical treatment, services, and supplies, where the determination of that value has not been made, is not an order affecting the merits of the case, and is not, therefore, appealable to the Workers’ Compensation Court of Appeals under Minn. Stat. § 176.421, subd. 1.
Determined by: Johnson, C.J., Wilson, J., and Stofferahn, J.
Compensation Judge: Rolf G. Hagen
Attorneys: Robin Simpson and Radd Kulseth, Aafedt, Forde, Gray, Monson & Hager, Minneapolis, MN, for the Cross-Appellants. Roderick C. Cosgriff and Adam J. Brown, Heacox, Hartman, Koshmrl, Cosgriff & Johnson., for the Appellant.
THOMAS L. JOHNSON, Judge
Fairview Health Services appeals the compensation judge’s finding that the obligation of Hage Construction Company and General Casualty Insurance Company to Fairview Health Services for the employee’s surgical procedure is the reasonable value of those services not to exceed 85% of the usual and customary charges for similar treatment. Hage Construction Company and General Casualty Insurance Company cross-appeal the compensation judge’s finding that Fairview Health Services is and Synthes Spine is not a health care provider. We conclude the compensation judge’s decision is not appealable under Minn. Stat. § 176.421.
On September 27, 2005, Andrew Konczal, the employee, sustained a personal injury arising out of his employment with Hage Construction Company, the employer, then insured by General Casualty Insurance Company. The employer and its insurer admitted liability for the employee’s personal injury.
In January 2007, the employee underwent anterior spine stabilization surgery at Fairview Southdale Hospital utilizing ProDisc components manufactured by Synthes Spine. Fairview Southdale Hospital is part of Fairview Health Services. The parties stipulated the surgery was reasonable, necessary, and causally related to the employee’s personal injury. Fairview Health Services’ usual and customary charge for the ProDisc components utilized in the employee’s surgery was $18,113.00. This charge included a mark up of the manufacturer’s wholesale price in an amount undisclosed in the record. The insurer paid Fairview Health Services the sum of $9,950.00.
Fairview Health Services filed a Medical Request seeking payment of the unpaid balance. The case was heard by a compensation judge on stipulated facts pursuant to Minn. Stat. § 176.322. The issues presented to the compensation judge were:
1. Whether the Workers’ Compensation Court of Appeals’ decision in Buck Ulrick v. Tri-County Enterprises, No. WC07-284 (W.C.C.A. May 13, 2008), is controlling law requiring payment to Fairview Health Services of 85% of the usual and customary charges for the surgical implants in question.
2. Whether a Workers’ Compensation Judge has authority to make an independent determination as the reasonableness of Fairview Health Services’ charges in an amount less than the 85% limitation contained in Minn. Stat. § 176.136, subd. 1b.(b), on the grounds that the 85% limitation represents merely a ceiling on charges.
3. Whether the Commissioner of the Department of Labor & Industry has, by rule, established the reasonable value of the service, article, or supply, in lieu of the 85% limitation of Minn. Stat. § 176.136, subd. 1b.(b).
In a Findings and Order served and filed March 23, 2009, the compensation judge found that Fairview Health Services is a health care provider within the meaning of Minn. Stat. § 176.011, subd. 24, and Minn. R. 5221.0700, subp. 2.A.(2); that Synthes Spine is a supplier and not a health care provider within the meaning of the aforecited statute and rule; that the employer and insurer’s obligation to Fairview Health Services for the surgical procedure performed on September 27, 2005, may not exceed 85% of the provider’s usual and customary charge for similar treatment, articles and supplies pursuant to Minn. Stat. § 176.136, subd. 1b.(b), and that a compensation judge has the authority to determine the reasonable value of Fairview Health Service charges in an amount less than the 85% limitation contained in Minn. Stat. § 176.136, subd. 1b.(b). The compensation judge then ordered the matter be set for a full evidentiary hearing to determine the reasonable value of the charges of Fairview Health Services.
Fairview Health Services appeals the compensation judge’s finding that a compensation judge has authority to determine the reasonable value of charges of Fairview Health Services in an amount less than the 85% limitation contained in Minn. Stat. 176.136, subd. 1b(b). Hage Construction Company and General Casualty Insurance Company cross-appeal the compensation judge’s determination that Fairview Health Services is and Synthes Spine is not a health care provider under the meaning of the applicable statute and rules.
Appeals to the Workers’ Compensation Court of Appeals are governed by Minn. Stat. § 176.421, subd. 1, which provides that a party may appeal to this court “within 30 days after a party in interest has been served with notice of an award or disallowance of compensation, or other order affecting the merits of the case.” As a general rule, an order is appealable only if it “finally determines rights of the parties and concludes the action.” Hagen v. Hoffman Aseptic Packaging, slip op. (W.C.C.A. May 8, 1997) (citing Zizak v. Despatch Indus., Inc., 427 N.W.2d 755, 756 (Minn. App. 1988)). The policy behind the general rule is to prevent piecemeal appeals and protect the rights of all parties until all claims have been adjudicated in the trial court. Johnson v. Johnson, 363 N.W.2d 355, 357 (Minn. App. 1985) (citing Comment, Minn. R. Civ. App. P. 104.01), pet. for rev. denied (Minn. May 6, 1985). Orders which do not affect the merits of the case or do not prevent a later determination of the case on the merits, are not appealable to this court. Mierau v. Alcon Indus., Inc., 386 N.W.2d 741, 38 W.C.D. 652 (Minn. 1986).
“The existence of a justiciable controversy is prerequisite to adjudication. The judicial function does not comprehend the giving of advisory opinions. No controversy is presented, absent a genuine conflict in the tangible interests of opposing litigants.” Izaak Walton League of Am. Endowment, Inc., v. State, Dep’t. of Natural Resources, 312 Minn. 587, 589, 252 N.W.2d 852, 854 (1977). The existence of a justiciable controversy may be raised on the court’s own motion since it is essential to a court’s exercise of jurisdiction. Makitalo v. Sears, Roebuck & Co., slip op. (W.C.C.A. May 9, 1995).
The appellate courts have used a three-part test in determining whether an issue presented for a decision constitutes a justiciable controversy. The issue must (1) involve definite and concrete assertions of right by parties with adverse interests, (2) involve a genuine conflict in tangible interests of opposing litigants, and (3) be capable of relief by decree or judgment. Graham v. Crow Wing County Bd. of Comm’rs, 515 N.W.2d 81, 84 (Minn. App. 1994) (citing St. Paul Area Chamber of Commerce v. Marzitelli, 258 N.W.2d 585, 587 (Minn. 1977), pet. for rev. denied (Minn. June 2, 1994). This test appears to have originated in cases involving declaratory judgment actions under Minn. Stat. Ch. 555 which gives courts of record the “power to declare rights, status, and other legal relations whether or not further relief is or could be claimed.” Minn. Stat. § 555.01. See also Seiz v. Citizens Pure Ice Co., 207 Minn. 277, 290 N.W. 802 (1940). The test has, however, also been utilized in cases not arising under the declaratory judgment statute. See, e.g., Rosenfeld v. Rosenfeld, 529 N.W.2d 724 (Minn. App. 1995). This three-part test has been cited in cases involving the issue of whether an appeal to the W.C.C.A. presented a justiciable controversy. See, e.g., Carlson v. Donovan Constr. Co., 62 W.C.D. 72, 78 (W.C.C.A. 2001), summarily aff’d (Minn. Feb. 5, 2002).
In Johnson v. Apple Valley Health Care Ctr., WC04-195 (W.C.C.A. 2004), a party appealed the compensation judge’s pretrial order determining the nature of the proceedings to be held before the compensation judge, including a statement of the burden of proof and a determination of the party upon whom the burden of proof rested. On appeal from the compensation judge’s pretrial order this court concluded the appeal was premature and held the court lacked subject matter jurisdiction over the appeal. In Davidson v. Northshore Mfg. Co., 60 W.C.D. 69 (W.C.C.A. 1999), summarily aff’d (Minn. Nov. 14, 2000), the employee filed a rehabilitation request not to obtain retraining benefits but to preserve his rights to retraining benefits should he decide to pursue retraining at some time in the future. That is, the employee sought guidance as to how the requirements of Minn. Stat. § 176.102, subd. 11(c), might be satisfied. On appeal, this court concluded that nothing in the Workers’ Compensation Act allowed for either advisory opinions or declaratory judgments. Since the issue was not ripe, and no benefits were yet at stake, the decision of the compensation judge was vacated as premature and the appeal was dismissed. See Herrly v. Walser Buick, Inc., 47 W.C.D. 670 (W.C.C.A. 1992); see also Froland v. American Hardware Ins. Co., slip op. (W.C.C.A. Oct. 10, 1996).
In this case, there has been no award or disallowance of compensation or other order affecting the merits of the case and no benefits are yet at stake. The compensation judge’s decision does not determine the rights of the parties or conclude the action. Rather, the parties seek only a legal interpretation of Minn. Stat. § 176.136, subd. 1b.(b). The parties are requesting an advisory opinion and no justiciable controversy exists. The appeal of Fairview Health Services and the cross-appeal of Hage Construction Company and General Casualty Insurance Company are, therefore, dismissed. The case is remanded to the Office of Administrative Hearings to schedule an evidentiary hearing.
 The matter was submitted to the compensation judge based upon stipulated facts. No witnesses were called and no testimony was taken by the compensation judge.
 Minn. Stat. § 176.136, subd. 1b.(b) provides:
The liability of the employer for the treatment, articles, and supplies that are not limited by subdivision 1a or 1c or paragraph (a) shall be limited to 85 percent of the provider’s usual and customary charge, or 85 percent of the prevailing charges for similar treatment, articles, and supplies furnished to an injured person when paid for by the injured person, whichever is lower. On this basis, the commissioner or compensation judge may determine the reasonable value of all treatment, services, and supplies, and the liability of the employer is limited to that amount. The commissioner may by rule establish the reasonable value of a service, article, or supply in lieu of the 85 percent limitation in this paragraph.