Payment of Disability Benefits Following a Finding of Maximum Medical Improvement

In Neal v. Carolina Management, ______ N.C. ________, _________ S.E. 2d ______, 1999

1. FACTS

   Plaintiff was a 57 year old female who worked as a waitress for the defendant-employer since 1986. Prior to beginning work for the defendant-employer, plaintiff suffered from a venous stasis ulcer in her left leg which resulted from a blood clot. In April of 1991, plaintiff sustained a compensable back injury while working for defendant-employer. Plaintiff received conservative treatment for 3 weeks after which she was referred to an orthopaedist, Dr. Appert. Dr. Appert examined the plaintiff on May 24, 1991 and released her to return to work the following day. However, plaintiff continued to experience low back pain. On June 19, 1991, a Form 21 agreement was approved by the Commission granting plaintiff temporary total disability benefits. Three months later, plaintiff re-injured her back while lifting a heavy tray and she returned to Dr. Appert for more treatment. Dr. Appert noted that plaintiff probably aggravated her prior back injury and released plaintiff back to work effective August 28, 1991, with no permanent disability. Plaintiff then sought treatment from another orthopaedist who prescribed different pain medication and additional physical therapy. Over the next 15 months, plaintiff was examined and treated for chronic lower back pain and leg pain by 2 neurologists, 2 neurosurgeons, a chiropractor and an orthopaedic surgeon. Plaintiff attempted to return to work in April of 1993, but quit after she experienced increased back and leg pain. Plaintiff then began seeing Dr. Derian, an orthopaedic surgeon, who diagnosed her as suffering from degenerative disc disease. A subsequent MRI revealed a herniated disc, which Dr. Derian thought could be surgically corrected. However, it was his opinion that if plaintiff did not pursue surgical intervention to correct her problem, then she had reached maximum medical improvement as of September 13, 1993. Dr. Derian also stated that plaintiff continued to be permanently and totally disabled from gainful employment. Thereafter, plaintiff's left leg venous stasis ulcer reopened and she sought treatment from a general surgeon. Following a skin graft, plaintiff was released to return to work as a result of her left leg problem with restrictions of sedentary work under controlled circumstances that allowed plaintiff to elevate her leg on occasion.

   In April of 1994, defendants re-instituted vocational rehabilitation efforts. The vocational rehabilitation specialist located a telemarketing job for the plaintiff, but plaintiff stated that she was not interested in a telemarketing position and told the perspective employer about her past medical history. Plaintiff did not receive an offer for the job and vocational services were suspended.

   Plaintiff then filed a request for hearing seeking an Order that she was permanently and totally disabled. The Deputy Commissioner found that plaintiff had suffered an injury by accident which materially aggravated her pre-existing left leg Venous stasis ulcer, and that she had reached maximum medical improvement as a result of her back injury on September 13, 1993. The Deputy Commissioner awarded temporary total disability benefits, both parties appealed, and the Full Commission adopted the findings and conclusions of the Deputy Commissioner. In addition, the Full Commission ordered the plaintiff to continue to cooperate with vocational rehabilitation therapy.

2. ISSUES
   1. Whether the Industrial Commission erred by awarding plaintiff temporary total disability benefits after finding that plaintiff had reached maximum medical improvement as opposed to awarding plaintiff permanent and total disability benefits.
   2. Whether the Commission erred by requiring plaintiff to continue with vocational rehabilitation efforts.
   
   
   
3. HOLDING

   Plaintiff argued that the Commission erred in awarding plaintiff temporary total disability benefits, since temporary total disability benefits are only supposed to be available during the healing period and that once the Commission had found that plaintiff had reached maximum medical improvement, the Commission should have found her to be permanently and totally disabled. In a 2-1 decision, the Court of Appeals rejected this contention stating that the time at which a claimant reaches maximum medical improvement does not necessarily coincide with the end of the healing period. The Court of Appeals cited its prior decision in Franklin v. Broyhill Furniture Industries, 123 N.C. App. 200, 472 S.E.2d 382, cert. denied, 344 N.C. 629, 477 S.E.2d 39 (1996) in which it stated that "the healing period ends when an employee reaches maximum medical improvement...[and, only] when an employee has reached maximum medical improvement does the question of her entitlement to permanent disability arise." The Court noted that the term maximum medical improvement may mean the time at which a claimant is no longer receiving medical attention for injuries, but that the healing period can extend beyond that time, until the impaired bodily condition either stabilizes or becomes permanent. In this case, the Court noted that the Commission entered a finding of fact that the plaintiff had reached maximum medical improvement, but that this did not automatically denote an end to the healing process. The court also pointed out the fact that there was no finding of fact that the plaintiff had in fact reached the end of the healing process. Consequently, the Court found sufficient evidence existed upon which the Commission could reasonably conclude that the plaintiff was entitled to continuing temporary total disability compensation until she returned to employment or upon further order of the Commission.

   In addition, the Court also affirmed the Full Commission's order that the plaintiff continue to cooperate with reasonable rehabilitative procedures pursuant to N.C. §97-25.

   Judge Timmons-Goodson dissented from the majority opinion also relying on the Court of Appeals prior ruling in Franklin. Judge Timmons-Goodson found that the Franklin case clearly stated that "the healing period ends when an employee reaches maximum medical improvement" and that "temporary total disability is payable only during the healing period." Therefore, the Full Commission erred in awarding temporary total disability after a finding of MMI and an award of permanent disability was appropriate. Judge Timmons-Goodson felt the Franklin case was controlling.

   In addition, Judge Timmons-Goodson also dissented from the majority opinion that required the plaintiff to continue with vocational rehabilitation efforts. Judge Timmons-Goodson noted that there was no evidence tending to show the existence of any job which plaintiff could actively perform and that the Commission did not find that plaintiff could benefit from further vocational rehabilitation.

   The plaintiff appealed the split decision of the Court of Appeals panel to the Supreme Court. The Supreme Court, in a per curiam opinion, reversed the Court of Appeals decision based upon the reasons stated in the dissenting opinion of Judge Timmons-Goodson.

4. ANALYSIS

   This decision has already caused confusion and potentially raises more questions than it answers. Some in the plaintiff's bar are taking the position that employees who have not yet returned to gainful employment as of the date they reach maximum medical improvement are automatically entitled to permanent and total disability benefits. Some members of the defense bar are taking the position that nowhere in the Act does it state that benefits paid under G.S. §97-29 must be denominated either "temporary" total disability benefits or "permanent" total disability benefits. Therefore, the usual practice of designating benefits paid under §97-29 as temporary total disability benefits and benefits paid under §97-30 as temporary partial disability benefits should no longer be used and a more appropriate approach for the Commission to take would be to award continuing total disability benefits following a finding that employee has reached maximum medical improvement. Any decision regarding the award of "permanent" disability benefits would be deferred until an employee and employer have had an opportunity to commence or complete reasonable vocational rehabilitative efforts.

   Some of the questions raised by the decision in Neal may be answered, since a petition for rehearing has been filed with the Supreme Court.