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Malcomson v. Liberty Northwest

Court of Workers Compensation of Montana

August 16, 2013

TINA MALCOMSON Petitioner
v.
LIBERTY NORTHWEST Respondent/Insurer

APPEALED TO MONTANA SUPREME COURT – 09/12/13

Submitted: December 9, 2011

Summary:

Petitioner withdrew her consent allowing Respondent to have ex parte communications with her medical providers. She then signed a release allowing Respondent to obtain relevant medical information, but requiring Respondent to give her the opportunity to participate in any communications. Respondent terminated Petitioner's benefits, arguing that it is entitled to pursue ex parte communications with an injured worker's medical providers pursuant to §§ 39-71-604(3) and 50-16-527(5), MCA. Petitioner petitioned this Court, arguing that these statutes unconstitutionally violate her right of privacy under Article II, Section 10, of the Montana Constitution, and her right to due process under Article II, Section 17, of the Montana Constitution and under the Fifth and Fourteenth Amendments to the United States Constitution.

Held:

As applied to the facts of Petitioner's claim, § 39-71-604(3), MCA, is unconstitutional under Article II, Section 10, of the Montana Constitution. Petitioner does not seek to limit Respondent's ability to obtain relevant healthcare information regarding her claim; she seeks only to be advised that the communications with her treating physicians are taking place and to be included in the communications in order to protect her constitutional right of privacy. Although its provisions are identical to the language of § 39-71-604(3), MCA, this Court lacks the jurisdiction to rule on the constitutionality of § 50-16-527(5), MCA, since it is not part of the Workers' Compensation Act.

FINDINGS OF FACT, CONCLUSIONS OF LAW AND JUDGMENT

JAMES JEREMIAH SHEA JUDGE

¶ 1 The trial in this matter began on September 14, 2011, in Missoula, Montana. Stacy Tempel-St. John represented Petitioner Tina Malcomson. Larry W. Jones represented Respondent Liberty Northwest (Liberty). Senior Claims Case Manager Anna Waller, Claims Specialist Michele Wheeler, Senior Inside Claims Specialist Tricia Bowman, and Unit Leader Jaimie Kern also attended on Liberty's behalf.

¶ 2 The trial continued via videoconference on November 17, 2011. The Court participated via the office of Charles Fisher Court Reporting and Video Conferencing in Helena; Tempel-St. John participated via the office of Charles Fisher Court Reporting and Video Conferencing in Great Falls; and Jones participated via the office of Charles Fisher Court Reporting and Video Conferencing in Missoula.

¶ 3 The trial continued again via videoconference on November 30, 2011. The Court participated via the office of Charles Fisher Court Reporting and Video Conferencing in Helena; Tempel-St. John participated via the office of Charles Fisher Court Reporting and Video Conferencing in Great Falls; and Jones participated via the office of Charles Fisher Court Reporting and Video Conferencing in Missoula.

¶ 4 The trial concluded on December 9, 2011. Tempel-St. John and Jones presented their closing arguments to the Court during a telephone conference.

¶ 5 Exhibits: I admitted Exhibits 1 through 37 without objection. During the course of the trial, I admitted Exhibits 38 through 45 without objection.

¶ 6 Witnesses and Depositions: The depositions of Malcomson, Steven S. Carey, and Michael Woods, M.D., were submitted to the Court and are considered part of the record. On September 14, Waller, Annie Young, RN, BSN, Dana Headapohl, M.D., Kathy Kleinkopf, CRC, and Malcomson were sworn and testified. On November 17, Kern was sworn and testified. On November 30, Carey was sworn and testified.

¶ 7 Issues Presented: The Pretrial Order sets forth the following issues:

I. Whether Petitioner is entitled to reinstatement of her medical benefits, which Respondent terminated after she refused to allow Respondent to communicate ex parte with her healthcare providers.
II. Whether § 39-71-604(3), MCA, and § 50-16-527(5), MCA (2007), unconstitutionally violate Petitioner's right of privacy under Article II, Section 10 of the Montana Constitution.
III. Whether § 39-71-604(3), MCA, and § 50-16-527(5), MCA (2007), unconstitutionally violate Petitioner's right to due process under Article II, Section 17, of the Montana Constitution and under the Fifth and Fourteenth Amendments to the United States Constitution.

PROCEDURAL HISTORY

¶ 8 This case was initially submitted to the Court on Malcomson's motion for summary judgment. After considering the parties' respective briefs, I granted summary judgment in Malcomson's favor.[1] In my Order Granting Petitioner's Motion for Summary Judgment, I held that §§ 39-71-604(3) and 50-16-527(5), MCA, unconstitutionally violated Malcomson's right to privacy as applied to the facts of her case.[2]

¶ 9 Liberty subsequently moved for reconsideration of my decision, arguing that I had failed to accord it a hearing on the motion pursuant to ARM 24.5.329(5).[3] On April 13, 2011, I granted Liberty's motion and vacated my summary judgment order. I agreed that the parties could call witnesses at a future evidentiary hearing.[4] However, after subsequent research, I determined that I could not resolve factual disputes in the context of a summary judgment hearing and I ordered this matter to proceed to trial.[5]

FINDINGS OF FACT

¶ 10 Malcomson filed a workers' compensation claim for injuries she sustained on December 21, 2007, while performing her duties as the manager of Freemo's Pizza in Missoula.[6]

¶ 11 On December 29, 2007, Annie Young, RN, BSN, a medical case manager for PACBLU Northwest, wrote a letter of introduction to Malcomson in which she explained that Waller had referred Malcomson's case to her "to assist in the coordination of your medical care which resulted from your worker's compensation injury." Young further stated, "My goal is to assess your medical condition and provide assistance during your recovery process. I will be available to address your concerns about your injury . . . ."[7]Young testified at trial. I found her to be a credible witness.

¶ 12 On January 3, 2008, Malcomson signed a release which authorized PACBLU to contact her healthcare providers and for those providers to release to PACBLU any medical information and records pertaining to her December 21, 2007, industrial injury, and further authorized PACBLU and her healthcare providers to communicate in any manner.[8] On January 7, 2008, Malcomson signed a release which authorized Liberty and/or its agents to contact her healthcare providers to provide relevant healthcare information without prior notice to Malcomson.[9]

¶ 13 On January 23, 2008, Young e-mailed Kathy Reid, Malcomson's physical therapist. She copied the e-mail to Liberty's claims adjuster Anna Waller, but did not provide it to Malcomson or Malcomson's counsel. In the e-mail, Young informed Reid that she had spoken with Malcomson about her condition. Young advised Reid that, "I would favor not making too many exceptions in your schedule to accommodate 'running late' 'running early' etc." Young further complained that Malcomson "spends a great deal of our time/efforts with repetitive information" and that Malcomson "[r]ambles on" when asking for Young's opinion regarding effective weight loss programs.[10] Young testified that she considered this to be relevant healthcare information to communicate to Malcomson's medical provider.[11]

¶ 14 On March 12, 2008, Malcomson, through her counsel, revoked the releases via letter which stated in part that Liberty did not have permission to speak with her medical providers without prior notice to her attorney and an opportunity for a member of Malcomson's attorney's law firm to participate in the communication.[12]

¶ 15 Young periodically submitted invoices to PACBLU which listed her activities in connection with Malcomson's case. Pertinent to the present dispute, Young's invoices include the following itemizations:

3/13/2008 Phone call – Physician 0.3 [hours]
3/14/2008 Phone call – Physician 0.2 [hours]
3/17/2008 Phone call – Physician 0.3 [hours]
3/19/2008 Phone call – Physician 0.3 [hours]
3/27/2008 Phone call – Physician 0.3 [hours][13]

¶ 16 Malcomson's counsel asserts that neither Liberty nor its agents ever contacted her firm to allow her the opportunity to participate in any telephone calls to Malcomson's medical providers, nor did it advise her that such calls were occurring.[14] Malcomson's counsel further represents that Young made 32 ex parte telephone calls totaling 8.9 hours to Malcomson's medical providers on behalf of Liberty, including 1.4 hours of calls, noted above, which occurred after Malcomson revoked the ex parte release.[15]Young testified that she does not have any record of the specific content of her calls, but she believes she most likely spoke with a front desk person or secretary and not a physician. Young acknowledged that since Malcomson was not a part of these calls, Malcomson would have no way of knowing who Young spoke with or the subject matter of the conversations. Young further testified that she had ex parte conversations with Reid, Malcomson's physical therapist, but that she considers physical therapists "adjuncts to the provider's care" and not medical providers.[16]

¶ 17 On March 31, 2008, Waller wrote to Malcomson's counsel on behalf of Liberty and gave 14 days' notice that Liberty would deny liability for future compensation benefits due to Malcomson's refusal to "allow the insurer ex parte communication as permitted by statute . . . ."[17]

¶ 18 On April 1, 2008, Malcomson's counsel wrote to Waller and stated that Liberty could speak to her healthcare providers, but that any communications must include notice to Malcomson's counsel and an opportunity for Malcomson and her counsel to participate.[18]

¶ 19 On April 4, 2008, Malcomson executed a new release, prepared by her counsel, which authorized Liberty to obtain copies of all relevant medical and billing records, but which did not permit Liberty to speak with any of her medical providers without prior notice to her and her counsel. Malcomson further requested reinstatement of her medical benefits.[19] On that same date, Waller refused to reinstate Malcomson's medical benefits and, asserting that "your limited authorization was not in compliance with the law, " presented Malcomson with a new medical release for her signature.[20]

¶ 20 On April 8, 2008, Malcomson returned Liberty's release with her signature, but she added language which stated that she did not authorize Liberty or its agents to contact her healthcare providers without giving notice to her or her counsel. Along with the signed release, Malcomson's counsel also enclosed a letter in which she again requested reinstatement of medical benefits.[21] On April 9, 2008, Waller responded to Malcomson's counsel and refused to reinstate Malcomson's benefits, ...


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