On June 20, 2017 the Pennsylvania Supreme Court, in Protz v. WCAB (Derry Area School District) No. 6 WAP 2016 and No. 7 WAP 2017, effectively threw out the Impairment Rating Examination (“IRE”) scheme of Act 57 which had been in place since June 24, 1996. The IRE process partially brought Pennsylvania Workers’ Compensation claims out of the cave by attempting to curtail the “cradle to grave” course that had pervaded practice under The Act since its inception. The original legislation regarding the IRE process was passed when the 4th Edition of the AMA Guides was in place and it instructed that future examinations be completed pursuant to the most recent Guidelines in place. Protz involved a challenge as to whether the “most recent addition” could be used or whether all examinations had to be completed pursuant to the 4th Edition which was in place.
The Legislature’s response to Protz was introduced in October of 2017 in House Bill 1840 (HB1840). HB 1840 passed both the House and Senate and it was signed into law by Governor Wolf on October 24, 2018. Unlike its predecessor this Bill mandates use of the 6th Edition of the AMA’s Guides. Also unlike it’s predecessor this Bill indicates that the threshold for total disability is now 35% or more as opposed to 50% or more. This was obviously a concession to guarantee passage of the Bill. Following the passage of HB 1840 The Bureau of Workers’ Compensation has announced the IRE function is active immediately. The introduction and passage of this Bill was a direct response to the reverse course of workers’ compensation premiums, which had been declining since the 1996 enactment. The impact of Protz forced the PA Compensation Rating Bureau to file for an increase of loss costs of 6.06% in the middle of a policy year.
This Bill is without question good news to employers and insurers, but it only addressed the subsection invalidated by the court. Claimants will still need to be on benefits for 104 weeks and the 60 day window to schedule the exam. Additionally, per the 2017 Supreme Court ruling in Duffy v. WCAB, an IRE opinion may be invalidated if it does not take into account “fairly attributable” injuries despite their not being accepted or recognized by employer. Nothing is perfect but this is certainly a step in the right direction as the prospect of setting lifetime reserves without doubt saddles employers with extreme financial burdens.
For further information about this matter, please contact Kyle F. Colin at 267-702-1790, or kcolin@kentmcbride.com