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Workers’ Comp News Alert: PA Supreme Court Issues Landmark Opinion in Protz v. WCAB

On June 20, 2017, the Pennsylvania Supreme Court issued a landmark Opinion in Protz v. WCAB (Derry Area School District) declaring that the Impairment Rating Evaluation (IRE) provision in Section 306(a.2) of the Workers’ Compensation Act was unconstitutional in its entirety. In the 6-1 Majority Opinion authored by Justice Wecht, the Court concluded that the Pennsylvania legislature violated the state Constitution when it passed this provision because it gave unfettered discretion over Pennsylvania’s impairment-rating methodology to a private entity, the American Medical Association, not to a government agency or body. The Court went on to hold that Section 306(a.2) could not withstand constitutional scrutiny even if the AMA were a governmental body. The Court also determined that the Pennsylvania legislature did not include any of the procedural mechanisms that this Court has considered essential to protect against “administrative arbitrariness and caprice.” The Court emphasized that the language “most recent edition” contained in Section 306(a.2) violates that non-delegation doctrine. There was a brief Concurring Opinion written by Justice Saylor and only one Dissenting Opinion by Justice Baer.

In summary, before this decision, Section 306(a.2) of Workers’ Compensation Act permitted employers to require an injured worker to undergo an IRE after receiving 104 weeks of total disability benefits. If the IRE physician determined that the injured worker’s whole body impairment was less than 50 percent, as determined by the AMA Guides to the Evaluation of Permanent Impairment, the injured worker was limited to 500 weeks of future wage loss benefits. However, the Court’s Opinion in Protz v. WCAB (Derry Area School District) means that injured workers will no longer be subjected to attend evaluations seeking to cap the length of wage loss benefits to a period of 500 weeks of partial disability benefits and reduce overall future file exposure for insurance carriers, third party administrators and self-insured employers.

Interestingly, the Supreme Court was silent on the retroactive application to already decided matters, so this decision may likely breed new litigation by injured workers for reinstatement of benefits to total disability. The Bureau of Workers’ Compensation has already issued a Notification via WCAIS to practitioners that effective immediately, based upon the Protz Opinion, the Bureau will no longer designate physicians to perform Impairment Rating Evaluations. Moving forward, it is apparent that the current IRE process of conducting IREs using the 4th Edition of the AMA Guides is no longer valid. Therefore, each pending case involving an IRE should be reviewed and analyzed for updated strategy.

Should you have any questions or wish to discuss these complex legal and strategy issues in more detail, please do not hesitate to contact Rawle & Henderson LLP’s Workers’ Compensation Section.

Zach Rubinich is a partner in our Philadelphia office. He focuses his practice on the defense of insurance carriers, self-insured entities and third-party administrators against workers’ compensation claims in Pennsylvania. Based on his extensive experience, the Pennsylvania Bar Association Workers’ Compensation Law Section has certified him as Specialist in the practice of workers’ compensation law. Zach has handled all aspects of litigation before workers’ compensation judges, the Workers’ Compensation Appeal Board, the Commonwealth Court and the Pennsylvania Supreme Court. He routinely counsels employers, insurance carriers and third party administrators on claims management, workplace safety, return-to-work programs, employment practices and risk management. Zach is a Vice-Chair for the American Bar Association’s Tort Trial and Insurance Practice (ABA TIPS) Workers’ Compensation and Employers’ Liability Law Committee for 2016-2017. This is the second one-year term that Zach has served in this position. He has been selected as a member of the Diversity Committee for 2017-2018 for ABA TIPS. Zach was rated AV Preeminent by Martindale-Hubbell for the fifth consecutive year in 2017. He was selected as a Pennsylvania Rising Star by Super Lawyers from 2010 to 2014.

Zach can be reached directly at: (215) 575-4340 • zrubinich@rawle.com