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State Compensation Insurance Fund v. Peterson

Court of Workers Compensation of Montana

July 5, 1994



          Mike McCarter, Judge

         This appeal is from a March 29, 1994 Order on Motion for Continuation of Benefits entered by Stan Gerke, a hearing examiner for the Montana Department of Labor and Industry (DLI). The Order directed the insurer, State Compensation Insurance Fund (State Fund), to reinstate claimant's total rehabilitation benefits until the DLI issues a final order concerning rehabilitation options for claimant. On April 8, 1994, the State Fund appealed. The appeal is based on alleged errors of law arising out of the hearing examiner's interpretation of section 39-71-1023, MCA (1989). For the reasons set forth in this decision, the DLI Order is reversed.


         Based on the record below, which consists of the DLI file transmitted to the Court, the claimant suffered an industrial injury on January 22, 1990. The law in effect at the time of his injury, now repealed, [1] provided a specific procedure for determining rehabilitation options for injured workers. The procedure, which is administered by the DLI, initially requires the insurer to designate a rehabilitation provider. § 39-71-1014 (a), MCA (1989). The designated provider determines the first appropriate rehabilitation option for the injured worker. § 39-71-1015 (a), MCA (1989). Those options, in order, are:

(a) return to the same position;
(b) return to a modified position;
(c) return to a related occupation suited to the claimant's education and marketable skills;
(d) on-the-job training;
(e) short-term retraining program (less than 24 months);
(f) long-term retraining program (48 months maximum); or
(g) self-employment.

§ 39-71-1012 (2), MCA (1989). Where the worker in fact does not return to work, the DLI is then required to designate a rehabilitation panel to evaluate the worker and recommend a first appropriate rehabilitation option. § 39-71-1017, MCA (1989). Following the issuance of the panel's report, the DLI must consider the report and issue its own "initial order of determination" specifying the first appropriate option for the worker. § 39-71-1018 (1), MCA (1989). The initial order triggers the right to a hearing before the DLI. § 39-71-1018 (2), MCA (1989). After a hearing the DLI is required to issue a "final order," which in turn triggers the right of appeal to this Court. Section 39-71-1018 (3), (4), MCA (1989).

         The process described in the previous paragraph has not been completed. The State Fund designated Montana Rehabilitation and Clinical Consultants to evaluate claimant. Claimant did not return to work following that evaluation, so a rehabilitation panel was designated by the DLI. The panel issued its report on January 6, 1992, more than two years ago, determining that option (c) was appropriate and that claimant could return to work in a related occupation. On January 16, 1994, the DLI issued its Initial Order of Determination adopting the panel's recommendation. On January 28, 1992, the DLI received a letter from claimant requesting a hearing. A prehearing conference was scheduled for May 11, 1992, but was continued to May 29, 1992 at the request of the claimant. On June 1, 1992, the hearing examiner filed an order continuing the prehearing conference indefinitely since the parties had agreed to an indefinite postponement. On July 3, 1992, claimant's attorney filed a status report indicating claimant had been allowed to see Dr. Johnson and was scheduled to see Dr. Lovitt.

         Nothing else transpired until February 18, 1994, when claimant, through his attorney, filed a Motion to Continue Benefits pursuant to section 39-71-1023, MCA (1989), which governs payment of total rehabilitation benefits. According to the motion, claimant's benefits were cut off on March 13, 1992, reinstated on July 13, 1993 to allow for an independent medical examination by a psychologist, and again terminated on December 20, 1993. The State Fund did not dispute claimant's representations. While no documentation was presented to show that the terminated benefits were total rehabilitation benefits, the claimant's motion requested "an order continuing total rehab benefits and reinstate total rehab benefits." Lacking any further factual record, this Court must assume for purposes of this appeal that the benefits being paid at the time of initial termination on March 13, 1992, and reinstated during the period July 13 to December 19, 1993, were total rehabilitation benefits.

         On March 29, 1994, the hearing examiner granted the claimant's motion. In his Order on Motion for Continuation of Benefits, the hearing examiner determined that claimant "is entitled to rehabilitation benefits until date [sic] of the issuance of a Final Order of Determination by the Department of Labor and Industry pursuant to Section 39-71-1023 (4)(b), MCA." (Emphasis in original.) The determination was based on the hearing examiner's reading of Higgenbotham v. Stoltze-Connor Lumber Co., 248 Mont. 161, 810 P.2d 295 (1991), the decision of this Court in Montana Health Network v. Katherine Nelson, No. 9212-6649 (April 9, 1993) (decision withdrawn June 14, 1993), and prior decisions of the DLI.

         Section 39-71-1023, MCA (1989), provides for total rehabilitation benefits. The section was effective between July 1, 1987 and July 1, 1991, when it was repealed, 1991 Laws ...

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