JEFFREY KLINE, Employee/Appellant, v. BERG DRYWALL, INC., and AMERICAN COMPENSATION INS. Co./RTW, Employer-Insurer.

 

WORKERS= COMPENSATION COURT OF APPEALS

MARCH 31, 2003

 

 

HEADNOTES

 

ARBITRATION; JURISDICTION - CONSTITUTIONAL ISSUES.  This court does not have jurisdiction to determine whether the prohibition against counsel during a facilitation pursuant to the Union Construction Crafts Workers= Compensation Fund (Minn. Stat. ' 176.1812) is violative of the employee=s rights under the state or federal Constitution.

 

ARBITRATION.  Where the rules of the Fund provide only that legal counsel may not be present during facilitation, but do not prohibit the employee from retaining legal counsel at any point during the Fund=s dispute resolution process, and where the employee is entitled to a hearing before an arbitrator during which the employee is entitled to the representation of counsel, the rules do not, on their face, directly or automatically diminish an employee=s entitlement to benefits and do not violate Minn. State. '176.1812, subd. 4.

 

CONFLICT OF INTEREST.  There was no evidence the employer=s manager/owner, who was also a trustee of the Fund, had any involvement in the selection of the arbitrator, or in compensating the arbitrator, and we fail to see any inherent unfairness or conflict of interest in the process for selection of mediators and arbitrators under the Fund=s rules.

 

ARBITRATION; EVIDENCE - EXPERT MEDICAL OPINION.  It is the function of the arbitrator to determine the weight to be given any medical evidence.  Although, under Rule 9, the parties are bound by the findings, opinions and recommendations resulting from a peer review, chart review, second opinion examination or dispute resolution examination conducted by a Aneutral physician,@ the rule further provides an opportunity to dispute such findings, opinions or recommendations.  In the event of such a dispute, an examination under Rule 9 of the Fund is entitled to no greater weight than any other medical expert testimony.

 

Affirmed in part, and vacated and remanded in part.

 

Determined en banc.

Arbitrator Jeffrey W. Jacobs.

 

OPINION

 

THOMAS L. JOHNSON, Judge

 

The employee appeals the arbitrator=s denial of benefits.  We vacate the Findings and Order and remand the case to the arbitrator for further findings.

 

BACKGROUND

 

Jeffrey Kline sustained a personal injury on May 8, 2001, while working as a car­penter for Berg Drywall, Inc.  The employer, then self-insured for workers= compensation purposes, accepted liability for the employee=s personal injury.  The employee=s weekly wage was $1,026.40.

 

The employee first sought medical treatment at Park Nicollet Medical Center (PNMC) on May 17, 2001, complaining of right groin pain and pain in the lower quadrant.  Dr.  Lohstreter diagnosed a right inguinal hernia or internal ring strain and allowed the employee to return to work with a twenty-pound lifting restriction.  Dr. Kevin Ose examined the employee on May 24 and May 31, 2001.  The doctor diagnosed a right groin strain with no evidence for inguinal hernia.  Dr. Ose advised the employee to avoid lifting and strenuous activity.  Dr. Robert Gorman at PNMC examined the employee on June 4, 2001, and also diagnosed a right groin strain.  The doctor continued restrictions and ordered an ultrasound which showed a normal abdominal wall without evidence of hernia.  On July 3, 2001, the doctor=s diagnosis was right groin strain and right adductor thigh strain.  The employee returned to Dr. Gorman on August 15, 2001, with continued right groin and thigh complaints.  The employee stated that over the last few weeks he had felt depressed with a loss of interest in usual activities, a lack of concentration and feelings of guilt and worthlessness.  The doctor again diagnosed a chronic right groin strain and right adductor thigh strain and prescribed Paxil for depression.  The doctor recommended an MRI scan and continued restrictions of twenty to forty pounds of lifting, with limited bending, twisting, sitting and the ability to change positions as needed.  An MRI scan of the hip on August 22, 2001 was normal.

 

The self-insured employer retained Dovolis & Associates to perform surveillance on the employee which was obtained in August and September 2001.  Investigative reports, photos of the employee and videotapes of the employee were obtained and provided to the employer.

 

The employee saw Dr. Ali Ahmad Hamidi at PNMC on September 18, 2001, with continued complaints of groin pain.  On examination, Dr. Hamidi found no swelling but noted severe tenderness over the medial aspect of the inguinal area and tenderness in the groin, testicle and spermatic cords.  The doctor diagnosed right groin and testicle pain due to the work injury and prescribed ibuprofen, Vioxx and physical therapy.  The employee returned to see Dr. Gorman on October 16, 2001.  The doctor=s diagnosis was unchanged and he continued the same restrictions.  Dr. Gorman increased the employee=s Paxil and recommended the employee contact the mental health department for further evaluation and treatment.  By report dated November 15, 2001, Dr. Gorman opined the employee had reached maximum medical improvement and rated no permanent partial disability.  The doctor, however, assigned lifting restrictions and concluded the May 8, 2001 personal injury caused a permanent injury to the employee=s right lower quadrant.  By report dated May 11, 2002, Dr. Gorman indicated the employee=s depression was causally related to the work injury.

The employee=s union and the employer, through a collective bargaining process, agreed to resolve work injury disputes through an alternative dispute resolution process permitted under Minn. Stat. ' 176.1812.  Under the terms of the agreement, work injury disputes are addressed through the Rules and Regulations of the Union Construction Crafts Workers= Com­pensation Fund.  The Fund is not an insurance provider or program but a claim dispute adminis­tration service.  Kevin Gregerson is the facilitator of the Fund.  Pursuant to the rules of the Fund, the dispute prevention and resolution program consists of three components: facilitation, mediation and arbitration.  The Fund established a list of persons to serve as arbitrators.  The rules provide these persons may not be employees of the Fund.^[1]

 

A dispute arose between the employee and the employer as to the nature, extent and duration of the employee=s injury, disability and entitlement to benefits.  In September 2001, Mr. Gregerson, at the request of the employer, scheduled a dispute resolution examination with Dr. Mark H. Johnson.^[2]  By letter dated October 19, 2001, Mr. Gregerson wrote Dr. Johnson providing the doctor with copies of medical records, a Awork comp summary@ prepared by a representative of the employer, and a copy of the surveillance reports prepared by Dovolis & Associates.  Dr. Johnson examined the employee on November 6, 2001, and prepared a written report.  Dr. Johnson concluded the employee=s May 8, 2001 injury was not a substantial contributing cause of his current impairment or disability.  The doctor opined the employee demonstrated symptom magnification and perhaps malingering and found a great disparity between the employee=s stated limitations and the actual observation of his physical activities.  The doctor opined further physical therapy was not appro­priate.  Dr. Johnson assigned a forty-pound lifting restriction, but stated this was an accommodation for the employee=s symptoms rather than based on any specific physical recommendation.  Finally, the doctor opined the employee had reached maximum medical improvement without evidence of any permanent partial disability.  On November 26, 2001, the employer terminated the employee=s employment.

 

On December 7, 2001, the employee retained Russell G. Sundquist to represent him in this proceeding.  That same day, Mr. Sundquist wrote Mr. Gregerson asking for copies of the surveillance tapes and requesting to appear on behalf of the employee at a facilitation scheduled for December 18, 2001.  Mr. Sundquist was later provided with a copy of the rules and regulations of the Fund which provide that legal counsel Ashall not be present during the facilitation unless all parties agree.@  (App. Ex. 5, Rule 3.4.)  The employee attended the facilitation without counsel and a decision was apparently issued on December 26, 2001.  Thereafter, the parties proceeded to mediation as provided by the rules.  This was unsuccessful and the parties proceeded to arbitration, the final stage of the Fund=s dispute resolution process.

 

In May 2002, Mr. Gregerson, at the request of the employer, arranged a dispute reso­lu­tion examination with Dr. Stephen Butzer, a psychiatrist.  By letter dated May 20, 2002, Mr. Gregerson provided the doctor with medical records, letters and information from both the em­ployee=s and the employer=s attorney, and a list of questions to be answered by the doctor.  By report dated May 24, 2002, Dr. Butzer diagnosed malingering as the substantial contributing cause of the employee=s current symptoms and reported problems.  The doctor diagnosed a pre-existing personality disorder of an unspecified type which would likely cause conflict with employers, individuals or others with expectations of the employee.  The doctor opined the employee needed no work restrictions.  Finally, Dr. Butzer felt the employee might benefit from counseling, but stated the need for treatment was not related to the May 8, 2001 work injury.

 

The Fund assigned an arbitrator from its list of arbitrators to hear the case.  The employee petitioned for the assignment of a different arbitrator.  The request was granted by the Fund and Jeffrey W. Jacobs, Esq., was assigned as arbitrator.  The case was heard before Mr. Jacobs on June 24, 2002.  In a Findings and Order filed July 19, 2002, the arbitrator found the employee failed to prove he sustained a psychological injury as a consequence of his admitted personal injury.  The arbitrator further accepted the opinions of Dr. Mark Johnson and found the employee=s May 8, 2001 injury was temporary and had completely resolved no later than November 21, 2001.  Accord­ingly, the arbitrator denied the employee=s claims for temporary total and temporary partial disability benefits and penalties.  The employee appeals.^[3]

 

DECISION

 

1.  Right to Counsel

 

The employee contends that under the rules of the Fund, at the early stages of the investigation and dispute resolution process, and at the facilitation, he was not permitted to be represented by legal counsel.  This prohibition, the employee argues, violates his due process rights under the United States and Minnesota Constitutions.  In its brief of Amicus Curiae, the Fund contends this court has no jurisdiction to consider the legality or constitutionality of the rules of the Fund.  Rather, they argue the agreement is part of the collective bargaining process governed by Section 301 of the Labor Management Relations Act so any challenge to the validity of the process must be before a federal court.  The employer and insurer also contend this court lacks jurisdiction to rule on the constitutionality of the enabling legislation and the rules of the Fund.

 

The Workers= Compensation Court of Appeals is not a court of general jurisdiction.  This court can act only within the parameters of the authority granted under the Workers= Compensation Act.  Minn. Stat. ' 175.A01, subp. 5.  The act does not give this court authority to determine the constitutionality of a provision of the act or of a rule of the Fund.  Whether the prohibition against counsel during a facilitation is violative of a right conferred by the federal or state Constitution is not an issue within the jurisdiction of this court.  We, therefore, take no position on the merits of the employee=s constitutional arguments.

 

2.  Minn. Stat. ' 176.1812, subd. 4

 

Minn. Stat. ' 176.1812, subd. 4, provides

 

Nothing in this section shall allow any agreement that diminishes an employee=s entitlement to benefits as otherwise set forth in this chapter [chapter 176].  For purposes of this section, the procedural rights and dispute resolution agreements under subdivision 1, clauses (a) to (g) are not agreements which diminish an employee=s entitle­ment to benefits.  Any agreement that diminishes an employee=s entitlement to benefits as set forth in this chapter is null and void.

 

The employee contends the prohibition against counsel, contained in the Fund=s rules, violates the statute because it diminishes an employee=s entitlement to benefits.  We are not persuaded.

 

An Executive Summary prepared by the Fund states that the Aalternative dispute resolution (ADR) process is binding on all parties, and prohibits the use of defense or plaintiff attorneys in the early stages of the dispute.@  (App. Ex. 2.)  This summary suggests the prohibition of attorneys results in Afewer hassles, faster return to work, and lower losses.@  Neither the re­spondent nor the Fund in its Amicus brief provides any explanation of the rule prohibiting attorneys during the facilitation.  While the prohibition of counsel applies to both the employer and the employee, an employer/insurer typically has a claims representative who represents its interest.  Certainly, there can be and often is a large disparity between the level of knowledge and sophistication possessed by an injured employee and an employer and insurer=s claim representative.  As the employee correctly notes, if a worker is uninformed or misinformed of his or her rights at the early stages of dispute resolution, those rights may be lost forever.

 

We note, however, the rules of the Fund provide only that legal counsel may not be present during a facilitation unless all parties agree.  Nothing in the rules prohibit the employee from retaining legal counsel at any point during the Fund=s dispute resolution process.  To the contrary, Rule 3.2 provides that either party may retain legal counsel at any time.^[4]  (App. Ex. 5.)  A Union Employees= Guide, prepared by the Fund, states, AIf you feel that you need your own attorney, you are free to hire one at any time.  The only restriction is that the facilitator deals directly with you, your employer, and the insurance company not through any attorneys.  Of course, you can talk with your lawyer before and after facilitation.@  (App. Ex. 6.)  Finally, the employee is always entitled to a hearing before an arbitrator to resolve any dispute.  On its face, the rule prohibiting representation at the facilitation does not directly or automatically diminish an employee=s entitlement to benefits.  Whether the prohibition violates some fundamental constitutional right of the appellant is outside this court=s jurisdiction.  Accordingly, we decline to set aside the arbitrator=s award on this basis.

 

3.  Relationship Between Employer and Fund

 

Kathy Berg is a manager/owner of Berg Drywall, the employer, and a Management Trustee of the Fund.  Ms. Berg, in her capacity as an owner/manager of the employer, attended the arbitration hearing.  The employee contends Ms. Berg=s dual roles as a party and a trustee created an inherent conflict of interest.  The employee further contends the trustees of the Fund are empowered to select, compensate and discharge arbitrators.  Ms. Berg=s power to select, compensate and discharge arbitrators, the employee argues, created a conflict of interest which should have disqualified Mr. Jacobs as acting as an arbitrator and prevented Ms. Berg from attending the arbitration hearing.  Following the arbitrator=s decision, the employee filed a motion for a new hearing based upon this claimed conflict of interest.  The motion was denied by the arbitrator.  The employee appeals that denial.

 

By affidavit dated December 6, 2002, Kevin Gregerson stated Mr. Jacobs and the other attorneys on the arbitrator/mediator panel were selected from a list of 87 applicants by the Board of Trustees in April 1997.  Berg Drywall did not become a participant in the Fund until October 1, 1998, and Kathy Berg was not appointed to serve as a trustee of the Fund until July 23, 2001.  Mr. Gregerson=s affidavit further stated that while the trustees set the hourly fees of the mediators/arbitrators, no trustees are employees of the Fund and the payments are not made by the trustees but by the Fund=s administrative staff.

 

We fail to see any inherent unfairness or conflict of interest in the process for selection of mediators and arbitrators.  While Ms. Berg is both a party and a trustee, we find no evidence she had any involvement in the selection of Mr. Jacobs or in his compensation.  Further, if the employee=s argument were accepted, any employer serving as a trustee would be precluded from utilizing the Fund to resolve disputes.  As the arbitrator correctly noted, the conflict of interest allegation is Adirected at the entire panel since any person on the panel would potentially be subject to the allegation of bias any time a matter arises involving a firm or union who has representation on the Board overseeing the Fund.@^[5]  Such a result would, in effect, disqualify any arbitrator from ruling on any case in which an agent of the employer was also a trustee.  The arbitrator=s denial of the employee=s motion for a new hearing is affirmed.

 

4.  Evidentiary Weight of Medical Opinions

 

Rule 9.1 of the Rules and Regulations of the Fund provides, AIn the event that there is a disagreement with a primary treating health care provider=s or specialist=s findings or opinions, the Fund shall establish a list of health care providers who shall be available to provide peer reviews, chart reviews, second opinion exams, or dispute resolution exams.@  Rule 9.3 provides ABoth the Employer and Employee shall be bound by the findings, opinions and recommendations resulting from the provider=s review or exam.  In the event of a disagreement with the provider=s findings and recommendations, the sole recourse of either party shall be to present the disputed issues through the Dispute Prevention and Resolution Program.@  The employee contends the arbitrator misconstrued Rule 9.3, affording Dr. Johnson=s opinions greater weight than those of the treating physician.  Accordingly, the appellant argues the arbitrator erred as a matter of law in weighing the medical evidence.  We are compelled to agree.

 

The arbitrator found A[t]he case revolves around the evidentiary support for the medical opinions in this matter.  Here the greater weight of the evidence supports the findings of Dr. Johnson.@  (Finding 9.)  In his memorandum, the arbitrator noted, Athe opinions of Drs. Johnson and Butzer are accepted as having greater weight than those of the doctors at PNMC [Park Nicollet Medical Center].  This conclusion is based on the evidence found in the surveillance information, the fact that the PNMC doctors did not apparently ever see this or have access to it, and on the findings in both DRE=s [dispute resolution examinations].@  (Mem. at 8.)  From these quotations, we might conclude the arbitrator weighed the medical evidence and found the opinions of Drs. Johnson and Butzer more persuasive.  In the memorandum, however, the arbitrator went on to state:

 

Thus, DRE=s are not like IME=s in the sense that an IME is nothing more than an opinion which has been requested by the insurer and for which there is no special evidentiary weight or presumption of neutrality.  Under the Rules of the Fund, the DRE is a neutral examination and is conducted by a doctor who is neither selected by the employee or nor the insurer but rather from a list of approved doctors maintained by the Fund.  The enabling statute, M.S. 176.1812, provides for a list of such impartial doctors to conduct such examinations.  See 176.1812, subd. 1(b), (c).  Because these doctors are agreed to by both parties to the Fund, i.e. labor and management, and are impartial their opinions are entitled to greater weight in this system than a traditional IME would be under the Rules governing hearing before the Office of Administrative Hearings.  Under these Rules a DRE examination is binding upon both parties.  While an arbitrator is free under this system to reject all or part of the findings or opinions in a DRE the party seeking to have that done must present something greater in terms of evidence than was presented here to subvert the opinions in those reports.  Here the employee did not present sufficient evidence to show that the opinions in the DRE reports of Drs. Johnson and Butzer should be rejected in favor of those of his treating doctors.

 

In litigation under chapter 176, it is a longstanding principle that it is the function of the factfinder to resolve conflicts in expert testimony.  Nord v. City of Cook, 360 N.W.2d 337, 37 W.C.D. 364 (Minn. 1985); Anderson v. Armour & Co., 257 Minn. 281, 101 N.W.2d 435, 21 W.C.D. 78 (1957).  Further, the trier of fact must determine the weight to be given to a medical opinion, including the opinion of a neutral medical examiner.  Stotz v. Sabin Bros., 257 N.W.2d 359, 30 W.C.D. 28 (Minn. 1977).  In Stotz, the court stated the opinion of a neutral medical evaluator under Minn. Stat. ' 176.155 Ais not necessarily and invariably decisive of an issue when other competent evidence will permit a different finding.@  Id. at 360, 30 W.C.D. at 29.  Fund Rule 6.4.3.c. states the arbitrator Ashall receive all evidence deemed necessary to understand and determine the dispute, consistent with the general rules of evidence.  Such rules shall be liberally construed in favor of admissibility, and the weight to be given such evidence is to be determined by the Arbitrator.@  Rule 6.4.3.c.(i) states A[t]he Arbitrator shall receive written medical and hospital reports, records and bills . . . the weight to be given any such written evidence is to be determined by the Arbitrator.@  (App. Ex. 5.)

 

Under Rule 9.3, the parties are bound by the findings, opinions and recommendations resulting from the peer review, chart review, second opinion examination or dispute resolution examination conducted under Rule 9.1.  If, however, either the employee or the employer disagrees with a provider=s findings or conclusions, that party may seek resolution of the dispute through mediation or arbitration.  See Rule 9.3.  We construe the rule to mean the result of a Rule 9.1 examination is binding on the parties only if neither party chooses to dispute the provider=s findings, opinions or recommendations.  In the event of a dispute, however, an examination under Rule 9 of the Fund is entitled to no greater weight before the arbitrator than any other medical expert testimony.  Rather, it is the function of the arbitrator to determine the appropriate weight to be given any medical evidence.

 

In his memorandum, the arbitrator noted this Awas a very close case.@  (Mem. at 8.)  We are concerned the arbitrator=s decision may have been influenced by his conclusion that the opinions of Dr. Johnson were entitled to greater weight than those of the employee=s treating physicians.  Accordingly, we vacate the Findings and Order and remand the case to the arbitrator for further findings consistent with this opinion.

 

5.  Neutral Physician Examination

Under Rule 9.1 of the Rules and Regulations of the Fund, either the AEmployee or Employer may contact the Facilitator to request a review or exam regarding diagnosis, treatment, permanent disability, medical causation, apportionment, or a related issue.@  Rule 9.2 provides that upon receipt of such a request, Athe Facilitator shall consult with the parties to determine the particular healthcare specialty and the level of review most appropriate towards resolution of the dispute.  Upon consideration of the facts and issues, the Facilitator will select the healthcare specialty and level of review and make the referral for the exam or review.@  (App. Ex. 5.)  On September 25, 2001, the employer contacted Kevin Gregerson, the facilitator, requesting an examination under Rule 9.1.  Mr. Gregerson then scheduled an examination with Dr. Mark Johnson.^[6]  By letter dated October 19, 2001, Mr. Gregerson wrote Dr. Johnson providing the doctor with copies of the employee=s medical records, a Awork comp summary@ prepared by a representative of the employer and a copy of the surveillance reports.  The employee contends the whole neutral physician examination process was inherently flawed and biased in favor of the employer.  Further, the employee argues the examination was conducted in an adversarial and prejudicial manner contrary to the letter and spirit of the Enabling Act and the Rules.  Accordingly, the employee contends the opinions of Dr. Johnson and Dr. Butzer should be either disallowed or disregarded by the Arbitrator.

 

Rule 9.2 requires that within five days of receiving a request for a neutral physician examination, the facilitator shall consult with the parties to determine the healthcare specialty and level of review most appropriate to resolve the dispute.  We find no evidence Mr. Gregerson consulted with the employee prior to scheduling the examination with Dr. Johnson.  The employee testified he did not discuss this examination with Mr. Gregerson and simply received a letter in the mail instructing him to attend the examination.  (T. 81-83.)  After scheduling the examination, the facilitator provided Dr. Johnson with a three-page letter containing comments from the employer and a four-page Awork comp summary@ prepared by a claims representative of the insurer.  The letter states, AMr. Kline chose not to respond to telephone and written notifications from my office that would provide him an opportunity to provide input prior to the examination.@  Mr. Gregerson then asked Dr. Johnson to respond to a number of questions concerning the employee=s current diagnosis, findings and whether the May 8, 2001 personal injury was a substantial contributing factor in the employee=s subsequent need for treatment and any disability.  (Pet. Ex. 6.)  On May 20, 2002, Mr. Gregerson wrote a similar letter to Dr. Butzer.  On this occasion, both the employee and the insurer provided information which Mr. Gregerson forwarded on to Dr. Butzer.

 

Minn. Stat. ' 176.1812, subp. 1.(c), provides the alternative dispute resolution process may include Athe use of a limited list of impartial physicians to conduct independent medical examinations.@  Section 9 of the Rules of the Fund is entitled ANeutral Physician Examination and Treatment Review.@  Rule 9.1 allows a choice of Apeer reviews,@Achart reviews,@Asecond opinion exams@ or Adispute resolution exams.@  (App. Ex. 5.)  These terms are not, however, defined in the Rules.  Presumably, a peer review or chart review envisions a review of the medical records only, while a second opinion or dispute resolution examination includes a physical examination of the employee.  Beyond this, we are aware of no distinction between the types of examinations. An independent medical examination or IME is typically considered an examination of the employee by the employer=s physician under Minn. Stat. ' 176.155, subd. 1.  The Rules do not, however, appear to permit the employer to obtain an IME except pursuant to section 9.  Thus, it would appear one purpose of Rule 9.1 is to provide the employer with a list of doctors to perform IMEs pursuant to Minn. Stat. ' 176.1812, subp. 1.(c). Thus, although styled a neutral physician examination, it appears Rule 9.1 is intended to permit the employer to obtain an independent medical examination whether through a record review or physical examination of the employee.^[7]

 

We find no evidence the Facilitator consulted with the employee on the choice of Dr. Johnson or the level of review of the doctor=s examination as required by Rule 9.2.  There is no provision in the Rules which specifically requires or authorizes the Facilitator to obtain from and furnish to the examining physician information prepared by either party such as the Awork comp summary@ prepared by the employer or the surveillance reports.  If, however, an employer-requested examination under Rule 9.1 is an independent medical examination, it is only reasonable for the employer to provide the examining doctor with such information as the employer deems relevant.  We cannot, therefore, conclude the Facilitator=s failure to consult the employee or the Facilitator=s provision of information to Dr. Johnson and Dr. Butzer was so prejudicial as to require the reports be stricken.  Rather, it is the function of the arbitrator to determine the weight to be assigned to any medical opinion.  On remand, the Arbitrator may consider all relevant factors in deciding the weight to be given to the medical opinions.