Opinion
W.C. No. 4-357-502
April 9, 1999.
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Friend (ALJ) which denied his claim for medical impairment benefits based on an impairment rating of 27 percent of the whole person. The claimant contends the ALJ improperly considered the affirmative defense of refusal to submit to essential medical treatment, and erroneously considered documents not admitted as evidence. We reverse the order in part, set it aside in part, and remand for entry of a new order.
The claimant sustained a shoulder injury in September 1997 and underwent surgery for repair of a torn rotator cuff. Subsequently, the claimant developed "frozen shoulder syndrome" which significantly limited his range of motion in the joint. The claimant's treating physician, Dr. Erickson, recommended "manipulation" of the shoulder under general anesthesia, but the claimant declined and was placed at maximum medical improvement (MMI) on December 24, 1997. In a December 24 report, Dr. Erickson noted the claimant refused to undergo manipulation of the shoulder and stated that "when the patient goes for a total impairment rating I do believe that these factors should be brought into consideration at the time of the formulation of his eventual disability." The claimant was then examined by Dr. Orent, who assigned a 16 percent whole person impairment rating based on lost range of motion in the shoulder.
The claimant then sought a Division-sponsored independent medical examination (IME) for purposes of challenging the impairment rating. On April 21, 1998, the Division IME physician, Dr. Cianflone, issued a report assigning a 27 percent whole person impairment rating. The rating was predicated on a 15 percent whole person rating for the shoulder, a 5 percent rating for "rotational impairment" of the thoracic spine, 5 percent impairment for rotational impairment of the cervical spine, and 5 percent impairment for injury-related depression.
The respondents filed an application for hearing in May 1998 listing the issue as permanent partial disability benefits. The respondents specifically stated that they intended to "overcome the opinions of the Division IME by clear and convincing evidence."
At the commencement of the hearing on January 5, 1999, the ALJ inquired of respondents' counsel concerning the issues to be heard. Counsel advised the ALJ that the respondents were seeking to overcome the Division IME. (Tr. p. 2) Respondents' counsel then elaborated as follows:
He was given a rating by Dr. Cianflone, both on the shoulder and neck rating, and also a psychiatric impairment rating, and the respondents thereafter referred the claimant to the Health Science Center and he was seen by Dr. Gunderson, who is a psychiatrist, and Dr. Clinkscales, who was an orthopedic doctor. Dr. Clinkscales basically agreed with the rating that was given for the extremity and the whole person rating given. Dr. Gunderson indicates there's no impairment, and also Dr. Schwartz, who is also a psychiatrist, says no permanent mental impairment.
The main point the respondent (sic) is going forward on is the claimant's refusal to treat, and so they submitted psychiatrist's opinions on permanent medical impairment. But we cannot overcome, obviously, the Division IME on physical rating because our doctors agreed with it. (Tr. pp. 2-3)
Both parties submitted medical records for consideration by the ALJ, but no testimony was taken. Dr. Gunderson opined the claimant has no permanent psychiatric impairment, and stated it is appropriate "to take into consideration this individual's resistance to further treatment when formulating the final impairment rating." Dr. Schwartz agreed that the claimant has no permanent psychiatric impairment, and stated the claimant "did not have a good explanation of why he will not follow through" on the recommendation for shoulder manipulation. Dr. Clinkscales opined that an impairment rating of 15 to 16 percent is appropriate for the claimant's shoulder problems.
The ALJ found the respondents failed to overcome the Division IME's rating with respect to the shoulder and psychiatric impairment. Consequently, the ALJ found the claimant has a 19 percent whole person impairment for these two conditions. However, the ALJ concluded that the respondents overcame the IME physician's opinion by clear and convincing evidence with respect to the thoracic and cervical impairment. In support of this conclusion the ALJ stated there was no evidence of a "specific disorder impairment with the thoracic or cervical spine," and that the "medical evidence shows no other physician identifying a specific disorder of the thoracic or cervical spine."
However, the ALJ declined to order the payment of medical impairment benefits based on the 19 percent whole person impairment. Instead, relying on § 8-43-404(3), C.R.S. 1998, the ALJ found the claimant unreasonably refused to submit to the shoulder manipulation recommended by the treating physician. Therefore, the ALJ exercised his discretion under the statute in concluding that the claimant's "permanent disability benefit should be reduced to zero."
I.
On review, the claimant contends he was denied due process of law because the ALJ reduced his permanent partial disability benefits based on refusal to submit to reasonably essential medical treatment as provided in § 8-43-404(3). The claimant argues the respondents did not raise this defense in their application for hearing, and that the remarks of respondents' counsel at the hearing were insufficient to provide notice that the ALJ would consider the issue. The respondents argue that the issue of refusal to submit to treatment is inherent in the determination of permanent partial disability, and also that the issue was tried by consent. We agree with the claimant, and therefore, we reverse the order insofar as it denied medical impairment benefits based on a 19 percent whole person impairment.
Pursuant to § 8-42-107(8)(c), C.R.S. 1998, the medical impairment rating of the Division IME physician is binding on the parties unless overcome by clear and convincing evidence. The statute requires that the IME physician to rate the claimant's impairment in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment, Third Edition (Revised) (AMA Guides). The party challenging the IME physician's rating carries the burden of proof to overcome the rating. Lambert Sons, Inc. v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 97CA1774, July 9, 1998). The questions of whether the IME physician properly applied the AMA Guides to determine the rating, and whether the IME physician's rating has been overcome by clear and convincing evidence, are questions of fact for determination by the ALJ. Metro Moving Storage Co. v. Gussert, 914 P.2d 411 (Colo.App. 1995).
Section 8-43-404(3) provides that where a claimant "refuses to submit to such medical or surgical treatment or vocational evaluation as is reasonably essential to promote recovery, the director shall have the discretion to reduce or suspend the compensation of any such injured employee." Under this statute the respondents bear the burden of proof to establish that the claimant's refusal to submit to surgery is unreasonable, that the proposed surgery is free from unusual risks, and that it is calculated to effect a cure. Cain v. Industrial Commission, 136 Colo. 227, 315 P.2d 823 (1957). We have previously ruled that § 8-43-404(3) creates an "affirmative defense" because the statute reduces compensation to which the claimant would otherwise be entitled. Fankhouser v. Public Service of Colorado, W.C. No. 3-722-925 (March 16, 1994); cf. Monfort, Inc. v. Gonzalez, 855 P.2d 19 (Colo.App. 1993) (former reemployment statute constituted an affirmative defense to claims for permanent partial disability benefits).
It follows that the affirmative defense based on refusal to submit to essential medical treatment does not constitute an inherent element of claims for permanent partial disability benefits. To the contrary, claims for permanent partial disability benefits are adjudicated in accordance with the IME provisions contained in § 8-42-107(8)(c). If the claimant successfully establishes entitlement to permanent partial disability benefits under § 8-42-107(8), the respondents might yet defeat or mitigate the award by proving the elements of refusal to submit to essential medical treatment under § 8-43-404(3). However, reliance upon § 8-43-404(3) requires the respondents to prove several factual predicates not contemplated by § 8-42-107(8).
Because § 8-43-404(3) constitutes an affirmative defense to a claim for permanent partial disability benefits, the respondents are required to plead the defense or it is considered waived. Kersting v. Industrial Commission, 39 Colo. App. 297, 567 P.2d 394 (1977); Rule of Procedure VIII (A)(5), 7 Code Colo. Reg. 11013 at 21. This principle protects the parties' due process rights to notice and an opportunity to be heard. Where, as here, an administrative adjudication turns upon questions of fact, all parties are entitled to be apprised of the evidence to be submitted and considered, and must be afforded a reasonable opportunity to confront adverse witnesses and present evidence and argument in support of their positions. Hendricks v. Industrial Claim Appeals Office, 809 P.2d 1076 (Colo.App. 1990).
It is true that where a party fails to plead an affirmative defense the opposing party may waive any objection by its conduct. A waiver may be evidenced by failure to object to introduction of evidence and argument on the disputed issue, and by the exercise of the rights of cross-examination and to introduce evidence in opposition to the defense. E.g., Robbolino v. Fischer-White Contractors, 738 P.2d 70 (Colo.App. 1987). However, the conclusion that an issue was tried by implied consent should be rejected where a reasonable doubt exists as to whether the issue was intentionally and actually tried. See Bill Dreiling Motor Co. v. Schultz, 168 Colo. 59, 450 P.2d 70 (1969) (applying principle under C.R.C.P. 15(b)). This is true because waiver must be the product of a voluntary, knowing and intelligent action. Johnson v. Industrial Commission, 761 P.2d 1140 (Colo. 1988); American National Bank v. Etter, 28 Colo. App. 511, 476 P.2d 287 (1970) (disallowing post-trial amendment of complaint on grounds of unfair surprise).
Here, we have a reasonable doubt that the claimant intentionally tried the issue of refusal to undergo essential medical treatment under § 8-43-404(3). As the claimant argues, the respondents did not plead the issue. Although the respondents' counsel stated the respondents were going forward on the issue of "refusal to treat," counsel made no specific reference to § 8-43-404(3). Neither did the ALJ expressly state that he was allowing the respondents to amend their application for hearing so as to include the affirmative defense provided by the statute.
Moreover, we cannot say that the conduct of claimant's counsel rises to the level of an implicit waiver. It is true that the medical records contain references to the claimant's refusal to undergo manipulation of his shoulder. However, these references might be viewed as medical opinions implying that refusal to accept treatment constitutes a proper basis for reducing the medical impairment rating under the AMA Guides. ( E.g., Erickson Report, December 24, 1997; Gunderson Report August 3, 1998). Consequently, claimant's counsel may have understood these documents as relevant to the issue of whether the respondents could overcome the Division IME rating by clear and convincing evidence, not documentation of an entirely separate affirmative defense under § 8-43-404(3). Further, statements of respondents' counsel at the commencement of the hearing appear to be inconsistent. At one point, counsel represented to the ALJ that the respondents intended to overcome the Division IME rating by clear and convincing evidence. (Tr. p. 2). Counsel then stated that the respondents believed it would be impossible to overcome the physical impairment rating. (Tr. p. 3). Due to the imprecise pleading, and the failure of the ALJ to further clarify the issues, the record is insufficient to treat the silence of claimant's counsel as an implicit agreement to try the affirmative defense of failure to submit to reasonable treatment under § 8-43-404(3).
It follows that the ALJ erred insofar as he concluded that the respondents were entitled to amend their application for hearing to include the affirmative defense. Consequently, the claimant is entitled to permanent partial disability benefits based on the medical impairment rating which the ALJ found was not overcome by clear and convincing evidence. Specifically, the ALJ determined that the claimant has a 19 percent whole person medical impairment rating for the combined shoulder condition and psychiatric condition. Consequently, the claimant is entitled to whole person medical impairment benefits based on the 19 percent impairment rating.
II.
The claimant next contends the ALJ improperly concluded that the respondents overcame the Division IME physician's rating for cervical and thoracic impairment because the ALJ considered provisions of the AMA Guides which were not admitted into evidence. We agree, and therefore, remand for entry of a new order on this issue.
The question of whether the Division IME physician properly applied the AMA Guides in arriving at the claimant's impairment rating is one of fact for determination by the ALJ. Metro Moving Storage Co. v. Gussert, supra. Consequently, the ALJ's finding that the IME physician improperly applied the AMA Guides must be supported by substantial evidence in the record. Metro Moving Storage Co. v. Gussert, supra; § 8-43-301(8), C.R.S. 1998. Moreover, it has been held that provisions of the AMA Guides are themselves evidence which must be introduced if relied upon to support the ALJ's order. See City of Boulder v. Dinsmore, 902 P.2d 925 (Colo.App. 1995).
Here, the ALJ found that the Division IME physician's opinion concerning cervical and thoracic impairment was overcome by clear and convincing evidence because there was a "lack of a specific disorder impairment with the thoracic or cervical spine and the fact that the medical evidence shows no other physician identifying a specific disorder of the thoracic or cervical spine." However, the Division IME physician necessarily concluded that the existence of a specific spinal disorder is not a prerequisite to assigning medical impairment based on lost range of motion in the cervical and thoracic spine. The record does not contain any provisions of the AMA Guides bearing on this point. Neither do any of the physicians who examined the claimant state that a rating for lost range of motion in the cervical and thoracic spine requires the physician to first identify a specific disorder of the spine.
Consequently, it appears that the ALJ considered evidence outside of the record and drew his own conclusions concerning the proper application of the AMA Guides to the claimant's specific condition. Under these circumstances, the ALJ's finding that the rating of the Division IME was overcome by clear and convincing evidence with respect to the cervical and thoracic impairment must be set aside. The case shall be remanded to the ALJ for entry of a new order on this point considering only the evidence admitted at the hearing. City of Boulder v. Dinsmore, supra.
In light of these conclusions we need not consider the claimant's remaining arguments.
IT IS THEREFORE ORDERED that the ALJ's order dated September 30, 1998, is reversed insofar as it denied permanent partial disability benefits based on a 19 percent whole person medical impairment. The claimant is entitled to permanent partial disability benefits based on this impairment.
IT IS FURTHER ORDERED that the ALJ's order is set aside insofar as it denied permanent partial disability benefits based on cervical and thoracic impairment, and the matter is remanded for entry of a new order on this issue.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________ David Cain ______________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate the Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, Colorado 80203, by filing a petition to review with the court, with service of a copy of the petition upon the Industrial Claim Appeals Office and all other parties, within twenty (20) days after the date the Order was mailed, pursuant to §§ 8-43-301(10) and 307, C.R.S. 1998.
Copies of this decision were mailed April 9, 1999 the following parties:
Cecle R. Crist, P.O. Box 314, Haines, OR 97833
I. R. Booth Son Booth Brothers, P.O. box 72, Lucerene, CO 80646-0072
American Compensation Insurance Co., 7400 E. Orchard Rd., Ste. 3025, Englewood, CO 80111
Michael P. Dominick, Esq., 250 Arapahoe Ave., Ste. 301, Boulder, CO 80302 (For Claimant)
Mark H. Dumm, Esq., Benjamin E. Tracy, Esq., 3900 E. Mexico Ave., Ste. 1000, Denver, CO 80210 (For Respondents)
BY: AP