Michael S. Rodriguez, Esq.

www.2Hurt2Work.com

BIGBENEFITSfor Employers with

1002 PROCESS

Exploring The Unforeseen

EffectiveAugust 1, 2013

Louisiana legislature enacted

La. R.S. 23:1201.1

A new procedure for an employee to

controvert compensation and certain

medical benefits.

La. R.S. 23:1201.1 is beneficial to an employer who abides with the procedural rules set out in the statute:

Preliminary Determination - a non-binding mini trial that forecasts how the Judge will rule at an actual full trial on the merits.

Creates multiple opportunities (i.e. safe harbors) for the employer or insurer to avoid being cast with penalties and attorney’s fees.

As an initial warning…

the additional protections provided by

La. R.S. 23:1201.1 are not guaranteed

and can be forfeited if the procedural

rules set out in the statute are not

followed.

Before discussing La. R.S. 23:1201.1

careful attention needs to be paid

to the LWC-WC-1002 Form. This

form is essential to the employer

initiating, modifying, suspending,

controverting, or terminating

benefits under the new law.

The Form is easily downloaded off the Louisiana Workforce Commission website

http://www.laworks.net/

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The 1002 Form should be used by the employer in the following situations:

first payment of compensation modification of compensation / medical benefits suspension of compensation / medical benefits termination of compensation / medical benefits controversion of compensation / medical benefits 23:1121 issues & disputes – Choice of Physician 23:1124 issues & disputes - SMO 23:1208 issues & disputes - Fraud 23:1226 issues & disputes - Rehabilitation

This form should not be

used to address medical

necessity questions.

The procedure to address

medical necessity

questions is outlined La.

R.S. 23:1203.1

LA Revised Statute 23:1201.1 (A) …

outlines the steps an employer or

insurer must follow to avail itself of the

penalties and attorney’s fees safe

harbor provisions, and the preliminary

determination hearing process.

The employer must first prepare a

1002 Form

The next step depends on whether the

1002 form is being issued relative to an

initial payment, or if it is being issued

relative to a modification, suspension,

termination, or controversion of

benefits.

Initial Payment

1. The 1002 form must be sent to the employee via U.S. mail simultaneously with the first payment. If the employee is represented, a copy of the 1002 form must be sent via facsimile to the employee’s attorney.

2. A copy of the same form should be sent to the Office of Workers’ Compensation within ten days of the initial payment. The address where the 1002 should be sent is Office of Workers’ Compensation, P.O. Box 94040, Baton Rouge, LA 70804.

Modification, Suspending, Terminating or Controverting Benefits

1. The 1002 form must be sent to the employee via certified mail on or before the effective date of modification, suspension, termination or controversion of benefits.

2. A copy of the same form should be sent to -----→

3. If the employee is represented, a copy of the1002 form must be sent via facsimile to his/her attorney.

Office of Workers’ CompensationP.O. Box 94040, Baton Rouge

LA 70804

Failing to follow procedures…

set out by La. R.S. 23:1201.1 (A), will

subject the employer to a lawsuit

without the benefit of any safe harbors

from penalties and attorney’s fees, as

well as forfeiting their right to a

preliminary determination hearing.

If employer follows procedures in La. R.S. 23:1201 (A)…

and the employee disagrees with the 1002 Form issued by the employer, the employee must file a Notice of Disagreement or prepare a Letter of Amicable Demand.

The Notice of Disagreement or Letter of Amicable Demand must specify the basis of disagreement and

include any calculations or back due payments, which the employee deems correct.

First Safe Harbor from Penalties and Attorney’s Fees

Employer has seven business days to comply with the demand.

If the employer complies with the employees demand within this time frame, the employee will be banned from making a claim for penalties and attorney’s fees for the improper calculation, termination, suspension, or controversion of benefits.

The employee is precluded from filing a formal lawsuit during this seven day “safe harbor” period. Violation of this rule would subject the employee to an Exception of Prematurity.

The Notice of Disagreement or Letter of Amicable Demand RECEIVED

If the employer does not comply with the Notice of Disagreement or Letter of Amicable Demand within 7 business days, the employee is allowed to file a lawsuit in Worker’s Compensation Court.

If the employer originally complied with the procedural requirements in La. R.S. 23:1201.1 (A), it can request a preliminary determination in its Answer. This will open the door to additional safe harbors from penalties and attorney’s fees.

Procedure for Requesting Preliminary Determination Hearing

What happens if

subsequent 1002 issues arise after a

lawsuit is filed?

1) employee does not follow the notice and mailing requirements for the 1002 form set out by La. R.S. 23:1201.1 (A).

2) employer does not initially accept compensability of a claim subject to further investigation and subsequent controversion.

3) employer fails to request a preliminary determination in his Answer.

An employee can challenge an employer’s right to a preliminary determination at any time by filing a Motion with the Court. The Judge will hold a rule to show cause to determine whether a preliminary determination is appropriate.

Preliminary Determination and Safe Harbor Provisions Not Available if…

Discovery for Preliminary Determination Hearing

The Workers' Compensation Judge shall initiate a telephone status conference with the parties to schedule discovery deadlines

The scope of discovery will be limited to the issues raised in the 1002 form and disputed by the employee.

The preliminary determination hearing shall be held no later than 90 days from the scheduling conference. However, upon a showing of “good cause”, one 30 day extension will be available.

Preliminary Determination Requested

Preliminary Determination Hearing

The preliminary determination hearing will be a contradictory hearing in which all parties can introduce evidence.

The testimony of physicians may be introduced by certified records or deposition. The parties can also agree to allow uncertified medical records into evidence.

Witnesses are allowed to testify at the hearing or, if agreed on by the parties, may offer testimony by introduction of a deposition.

Once the preliminary determination has been completed, the Judge will have thirty days to issue a recommendation.

EMPLOYER OPTIONS After a Preliminary Determination Hearing

Once a recommendation has been made by the Worker’s Compensation Judge, the employer has ten days to either:

Notify the injured employee or his representative in writing that the

employer does not accept the

determination.

Accept and comply with preliminary determination

recommendation and mail a revised 1002 Form to the injured employee or his

representative, along with any payment amount determined,

and any arrearage due.

SECOND Safe Harbor from Penalties and Attorney’s Fees

EMPLOYERAccepts & Complies within 10 days to Preliminary Determination…

shall not be subject to any penalty or attorney fees arising out of the original notice which was the subject of the preliminary hearing.

EMPLOYERDOES NOTAccept or Comply within 10 days to Preliminary Determination…

may, at the trial on the merits, be subject to penalties and attorney fees, arising out of the issues raised in the original notice.

EMPLOYER…

disagrees with the Preliminary Determination &

complies with the judges ruling

THIRD Safe Harbor from Penalties and Attorney’s Fees

must satisfy Preliminary Determination within 10 days of mailing by court.

must notify court within 10 days that employer would like to proceed to trial on the merits of the 1002 action.

After trial, does the employer benefit from a

3rd Safe Harbor from Penalties and Attorney’s

Fees?

Preliminary Determination Ruling NOT a Final Judgment & Added Benefits to Employer

Any employer who accepts and complies with the preliminary determination, and who does not request to proceed to trial on the merits of the 1002 matters, shall retain the right to further controvert future matters.

An employer’s acceptance of the preliminary determination ruling is not an admission of liability for future matters.

Preliminary determination rulings are not subject to the courts modification jurisdiction or the doctrine of res judicata.

Expedited Summary Proceedings Authorized by Statute La. R.S. 23:1201.1 (K)(8)(a) provides for expedited summary proceedings regardless of whether the employer is entitled to a preliminary determination in the following circumstances:

employee choice of physician disputes; employee disputes over vocational rehabilitation; employer seeks to compel the employee to sign the choice of

physician form; employer seeks to compel employee to attend SMO or IME; employer seeks to require the employee to return form LWC-1025 or

LWC-1020; and, employee seeks to have a suspension of benefits lifted for failure to

attend an SMO, IME, Voc Rehab, and for failure to submit 1020’s.

Final Thoughts on Expedited Proceedings…

Expedited proceedings shall be set within 3 days of the motion being filed and no later than 30 days after. The expedited proceeding will be carried out as a rule to show cause.

A ruling made by the worker’s compensation judge at an expedited summary proceeding will be binding on all parties without any further hearings or a trial.

If the employer was originally entitled to a preliminary determination, and a ruling is made at an expedited proceeding, an employer can avoid penalties and attorney’s fees by complying with the ruling within 10 calendar days (Safe Harbor).

Any Questions

Thank You for Attending