Attorneys across the Commonwealth of Pennsylvania have been waiting for the Pennsylvania Supreme Court to clarify the status of the Impairment Rating Evaluation section of the Act, since the Commonwealth Court struck down provisions and remanded the case back to a Workers Compensation Judge. The PA Supreme Court issued it’s decision as I sat in a workers compensation hearing around 11:30 AM this morning. In Protz v. WCAB (Derry Area School District), No. 6 WAP 2016, the Court struck down the IRE provisions of the Act as unconstitutional in it’s entirety.
To help you understand, let me first explain the IRE process. First, and foremost, it is a process used to limit injured worker wage loss benefits. The injured worker is examined by a doctor chosen by the Commonwealth for what is called an impairment rating evaluation. The IRE exam is solely used to establish a whole body impairment. If the IRE examination finds an injured worker to have 50% or less whole body impairment from the work-related diagnoses, then wage loss benefits are capped to 500 weeks (about 9 1/2 years). A request for an IRE examination by the insurance carrier cannot occur until an injured worker has received at least 104 weeks (2 years) of total disability compensation. Don’t confuse this examination with an IME (defense) examination. They are entirely different. IRE examinations are nothing more than a tool for an insurance carrier to limit wage loss benefits of the injured worker. Additionally, the provision is also unfair because it is nearly impossible to get a 50% or more whole impairment rating evaluation, outside completely catastrophic injuries.
Now that you understand that process a bit, the legal issue at stake in this case had nothing to do with fairness of the IRE process. Essentially, it was a Constitutional argument. The Constitutional provision argued in this case is non-delegation of power by the General Assembly.
Within the IRE section of the Act (306(a.2), the Legislature spelled out that IRE examination doctors are to apply the methodology of “the most recent edition” of the American Medical Association (AMA) Guidelines. The claimant in this case appealed an IRE decision alleging that the General Assembly unconstitutionally delegated to the AMA the authority to establish guidelines for the IRE process.
The Commonwealth Court ruled, sitting en banc, that Section 306 (a.2) violated the Pennsylvania Constitution’s non-delegation provisions in that the General Assembly unconstitutionally delegated its power to another branch of government or body. Rather than striking the entire provision, it declared the law unconstitutional “only insofar as it proactively approved versions of the AMA beyond the Fourth Edition (which was the edition in place when this provision was originally enacted by the General Assembly). The Court then remanded the case back to the local WCJ to decide based on the Fourth Edition of the AMA guidelines. The parties appealed. The ruling also put the entire IRE process on hold across the Commonwealth.
Today, the Pennsylvania Supreme Court went beyond the Commonwealth Court’s ruling. Instead of remanding and upholding the provisions in accordance with the Fourth Edition, the Court invalidated the entire IRE section of the Act. In order for a proper delegation of power to occur, Justice Wecht, writing for the Majority, wrote,
When the General Assembly does so, the Constitution imposes two fundamental limitations. First, as mentioned, the General Assembly must make the basic policy choices and second, the legislation must include adequate standards which will guide and restrain the exercise of delegated functions.
In striking the provisions down, Justice Wecht continued,
By any objective measure, the authority delegated to the AMA in Section 306 (a.2) of the Workers Compensation Act is even more broad and unbridled that that of the School Reform Commission (which the Court struck down) . . . the General Assembly did not favor any particular policies relative to the Guides methodology for grading impairments, nor did is proscribe any standards to guide or restrain the AMA’s discretion to create such methodology . . . equally problematic, the General Assembly did not include in Section 306 (a.2) any of the procedural mechanisms that this Court has considered essential to protect against “administrative arbitrariness and caprice.”
The Court next took up whether the Commonwealth Court erred in remanding the case back to the WCJ with instructions to apply the Fourth Edition of the AMA Guidelines.
The Court stated that although the AMA’s Fourth Edition guidelines were in effect when the IRE provisions were enacted, the term “most recent edition’ was used by the Legislature, not Fourth Edition. The Court pointed out that other parts of the Act spelled out specifically the ‘Fourth Edition.’ Therefore, the Court rationed, if the Legislature meant to say ‘Fourth Edition’, it would have said so, specifically.
Instead of remanding to the WCJ, the Court invalidated the entire Section of the Act. Justice Wecht wrote,
We view Section 306 (a.2) as a paradigmatic example of law containing valid provisions that are inseparable from void provisions. Consequently, we must strike Section 306 (a.2)) in it’s entirety from the Act . . . Unlike the Commonwealth Court, however, we hold Section 306 (a.2) us unconstitutional in its entirety.”
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