Compensability

States Split Over Mental Injury Claims

The difficulty in establishing objective medical opinion is an obstacle to handling workplace mental injury claims with any consistency.
By: | February 7, 2018 • 4 min read

The 1,800 miles separating Montana and Pennsylvania pale in comparison to the vastness separating their workers’ compensation laws on workplace mental injuries.

Recent court rulings, one from each jurisdiction, provide a reminder of how workers’ comp laws extensively differ from state to state and how those differences can complicate or ease a claim payer’s defense against claims alleging mental injuries.

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Both cases allege post-traumatic stress disorder (PTSD) among other psychological harms.

The Pennsylvania case of Vasser-Watts v. Workers’ Compensation Appeal Board involved two 1996 bomb threats and a customer service operator ordered to stay and answer calls while others evacuated a building.

In 1997 a workers’ comp judge ruled abnormal working conditions caused major depressive disorder and panic disorder along with PTSD. Pennsylvania’s Workers’ Compensation Appeal Board affirmed medical benefits for the three injuries.

But nearly 14 years later, when the employer in the case wanted to terminate those benefits, a years-long appeals battle ensued over whether the injured worker continued to suffer from the original conditions.

In addition to back-and-forth rulings between a workers’ comp judge and the appeal board, the case included dueling doctor opinions provided by a psychiatrist representing both sides.

The claims payer never argued that so-called “mental-mental” benefits are not compensable — because in Pennsylvania they clearly are. Instead, the employer argued that the claimant was no longer entitled, because she had recovered from those injuries.

Mental-mental refers to injuries having a mental stimulus and mental consequences. Mental stimulus can include stress, fear and anxiety.

On Jan. 24, 2018, the Commonwealth Court of Pennsylvania, an appeals-level body, affirmed the Board’s termination of medical benefits for PTSD and major depressive disorder. But it also reversed the Board’s termination of medical benefits for panic disorder.

“It’s about having the right evidence, having the right investigation and learning what is the mental history of the employee and having a qualified expert make a proper determination.” — Michael Stack, CEO, Amaxx Risk Solutions

The Montana case of TG v. Montana Schools Group Insurance Authority provides a contrasting example of how matters play out when state statutes prohibit workers’ comp benefits for mental-mental claims.

That situation involved a school aide hit, pinched and kicked by a special-needs high-school student who attacked her on two separate days. Three coworkers pulled her away from the second attack when the claimant couldn’t get the student off of her.

Michael Stack, CEO, Amaxx Risk Solutions

The attacks caused PTSD and aggravated the aide’s pre-existing anxiety, depression and “pseudoseizures,” court records show.

The claimant argued she suffered compensable physical injuries and physical-mental injuries.

But on Jan. 25.2018, a Montana workers’ compensation judge granted summary judgement to the Montana School Group Insurance Authority, which argued that the claimant’s injuries did not arise from physical stimulus.

The judge agreed the claimant did not suffer compensable physical injuries nor compensable psychological injuries. He ruled that her anxiety, depression and PTSD are mental-mental conditions while her pseudoseizures are a mental-physical condition. Neither type of claim is compensable under Montana law.

“The legislature recognizes that [emotional distress or mental-mental] claims are difficult to objectively verify and that the claims have a potential to place an economic burden on the workers’ compensation and occupational disease system,” the ruling states. “The legislature also recognizes that there are other states that do not provide compensation for various categories of stress claims … ”

Unlike the case of a physical injury that easily lends itself to objective medical findings, determining a level of anxiety or depression and whether pre-existing conditions or the workplace drive those conditions can be difficult, said Leslae Dalpiaz, a Montana workers’ comp attorney.

But fact patterns for some cases clearly show that mental stresses do harm workers and providing benefits is appropriate, said Dalpiaz, who represents injured employees. That is true for the case of TG v. Montana Schools Group Insurance Authority, she added.

“When you read the facts of this case it should be at least considered, and at the very least, a discussion about causation should occur,” Dalpiaz said.

Common sense tells us that certain events, like workplace shootings, can have enough impact to cause workers to suffer significant mental injuries that should be compensable, said Michael Stack, CEO, Amaxx Risk Solutions, which provides training in workers’ comp best practices.

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Although it is difficult for employers and other claims payers to establish a “clean line” determining what qualifies as a compensable mental injury, there are cases that deserve compensability, Stack agreed.

Eliminating compensation for all mental stimulus claims is irresponsible, Stack said. However, such claims will require digging deep to learn the facts for an appropriate decision on whether an ailment is work related, he added.

“It’s about having the right evidence, having the right investigation and learning what is the mental history of the employee and having a qualified expert make a proper determination,” he said.

But as the Montana ruling shows, some state legislatures decided efforts to reach determinations on individual mental claims places too great a burden on claims payers. &

Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

More from Risk & Insurance

More from Risk & Insurance

2018 Most Dangerous Emerging Risks

Emerging Multipliers

It’s not that these risks are new; it’s that they’re coming at you at a volume and rate you never imagined before.
By: | April 9, 2018 • 3 min read

Underwriters have plenty to worry about, but there is one word that perhaps rattles them more than any other word. That word is aggregation.

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Aggregation, in the transferred or covered risk usage, represents the multiplying potential of a risk. For examples, we can look back to the asbestos claims that did so much damage to Lloyds’ of London names and syndicates in the mid-1990s.

More recently, underwriters expressed fears about the aggregation of risk from lawsuits by football players at various levels of the sport. Players, from Pee Wee on up to the NFL, claim to have suffered irreversible brain damage from hits to the head.

That risk scenario has yet to fully play out — it will be decades in doing so — but it is already producing claims in the billions.

This year’s edition of our national-award winning coverage of the Most Dangerous Emerging Risks focuses on risks that have always existed. The emergent — and more dangerous — piece to the puzzle is that these risks are now super-charged with risk multipliers.

Take reputational risk, for example. Businesses and individuals that were sharply managed have always protected their reputations fiercely. In days past, a lapse in ethics or morals could be extremely damaging to one’s reputation, but it might take days, weeks, even years of work by newspaper reporters, idle gossips or political enemies to dig it out and make it public.

Brand new technologies, brand new commercial covers. It all works well; until it doesn’t.

These days, the speed at which Internet connectedness and social media can spread information makes reputational risk an existential threat. Information that can stop a glittering career dead in its tracks can be shared by millions with a casual, thoughtless tap or swipe on their smartphones.

Aggregation of uninsured risk is another area of focus of our Most Dangerous Emerging Risks (MDER) coverage.

The beauty of the insurance model is that the business expands to cover personal and commercial risks as the world expands. The more cars on the planet, the more car insurance to sell.

The more people, the more life insurance. Brand new technologies, brand new commercial covers. It all works well; until it doesn’t.

As Risk & Insurance® associate editor Michelle Kerr and her sources point out, growing populations and rising property values, combined with an increase in high-severity catastrophes, threaten to push the insurance coverage gap to critical levels.

This aggregation of uninsured value got a recent proof in CAT-filled 2017. The global tally for natural disaster losses in 2017 was $330 billion; 60 percent of it was uninsured.

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This uninsured gap threatens to place unsustainable pressure on public resources and hamstring society’s ability to respond to natural disasters, which show no sign of slowing down or tempering.

A related threat, the combination of a failing infrastructure and increasing storm severity, marks our third MDER. This MDER looks at the largely uninsurable risk of business interruption that results not from damage to your property or your suppliers’ property, but to publicly maintained infrastructure that provides ingress and egress to your property. It’s a danger coming into shape more and more frequently.

As always, our goal in writing about these threats is not to engage in fear mongering. It’s to initiate and expand a dialogue that can hopefully result in better planning and mitigation, saving the lives and limbs of businesses here and around the world.

2018 Most Dangerous Emerging Risks

Critical Coverage Gap

Growing populations and rising property values, combined with an increase in high-severity catastrophes, are pushing the insurance protection gap to a critical level.

Climate Change as a Business Interruption Multiplier

Crumbling roads and bridges isolate companies and trigger business interruption losses.

 

Reputation’s Existential Threat

Social media — the very tool used to connect people in an instant — can threaten a business’s reputation just as quickly.

 

AI as a Risk Multiplier

AI has potential, but it comes with risks. Mitigating these risks helps insurers and insureds alike, enabling advances in almost every field.

 

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]