Darr Construction Co. v. Workmen's Compensation Appeal Board

677 A.2d 1301, 1996 Pa. Commw. LEXIS 261

• Court: Commonwealth Court of Pennsylvania
• Decided: June 12, 1996
• Status: Published

Opinions

PELLEGRINI, Judge.¹

Darr Construction Company and its workers’ compensation carrier, Roekwood Casualty Insurance Company (together, Employer), petition for review of five orders of the Workmen’s Compensation Appeal Board (Board) which amended five separate referee decisions regarding Employer’s subrogation interest in the civil settlements of Richard Walker, Donald Reed, James Walker, Neil Rayman and Donald Ziegler (collectively, Claimants). Claimants filed cross-petitions for review of the same Board orders.² All petitions were consolidated by this court.

I.

The facts are not in dispute. Claimants were working for Employer on August 31, 1988, when an explosion occurred at the job site. As a result of the explosion, Claimants sustained work-related injuries for which they received benefits pursuant to notices of compensation payable. Claimants and their spouses ³ also commenced civil actions in the Court of Common Pleas of Somerset County against Peoples Natural Gas Company (Peoples), seeking to recover damages for Claimants’ August 31, 1988 injuries. The actions also sought damages for loss of consortium. Ultimately, each Claimant settled his third-party action with Peoples. The spouses of the married Claimants also settled their loss of consortium claims and signed separate releases. Employer did not agree to the settlement amounts or the designation of the loss of consortium amount and apparently was not involved in the settlement negotiations.⁴

Employer subsequently filed review petitions, alleging that each Claimant had received a third-party settlement for the same injury for which he was receiving workers’ compensation benefits. Employer further alleged that it was subrogated to each Claimant’s recovery pursuant to Section 319 of the Workers’ Compensation Act (Act), Act of June 2, 1915, P.L. 736, as amended, 77 P.S. § 671. Each Claimant filed an answer, admitting the settlement of the third-party action arising out of his work-related injury.

Before the respective referees hearing the cases, the parties entered into stipulations of fact. Specifically, the parties stipulated, inter alia, to the total amount of the third-party recovery; the amount of the consortium claim, if applicable; the total compensation lien at the time of settlement (including both indemnity payments and medical expenses); attorneys’ fees; total expenses; weekly compensation rate; and date of return to work, if applicable. However,, the parties were unable to agree on the amount or method of calculating Employer’s subro-gation interest.

Employer advocated application of the Net Method as set forth in Rollins Outdoor Advertising v. Workmen’s Compensation Appeal Board (Maas), 506 Pa. 592, 487 A.2d 794 (1985). Claimants asserted that Employer’s subrogation rights should be calculated by using the Gross Method contained in the Bureau of Workers’ Compensation Form LIBC-380 and applied in CNA Insurance Co. v. Workmen’s Compensation Appeal Board (Romeo), 134 Pa.Cmwlth. 478, 578 A.2d 1375 (1990).

Specifically, the parties could not agree regarding whether each Claimant was required to pay Employer its accrued compensation lien in full upon receipt of his civil settlement. Claimants advocated deducting Employer’s pro-rata share of expenses from the sum owed to Employer and then paying Employer the net amount. Employer, however, asserted that the accrued compensation lien should be paid in full at the time of settlement, with Employer reimbursing each Claimant its pro-rata share of expenses over the grace period.

The parties also disputed the extent of pro-rata expenses owed by Employer under Section 319 of the Act. Claimants argued that Employer must pay its pro-rata share of the expenses of recovery attributable to the accrued compensation lien and, in addition, Employer’s, pro-rata share of the expenses associated with future compensation that Employer is relieved of paying by virtue of each Claimant’s civil recovery. In contrast, Employer maintained that the Net Method levies a pro-rata share of expenses based solely upon the accrued compensation lien and, thus, relieves Employer of any obligation to pay a pro-rata share of expenses attributable to future benefits.

Finally, the married Claimants disagreed with Employer regarding whether Employer had a right of subrogation over their respective spouses’ consortium settlements.

Upon consideration of the eases on the stipulations of fact, the referees concluded that Employer was entitled to calculate its subrogation rights under the Net Method. Therefore, Employer’s pro-rata share of expenses was to be calculated solely upon its accrued compensation lien, and no additional reimbursement for expenses attributable to the future grace period was necessary.⁵

With respect to the consortium settlements between Peoples and the spouses of Reed and Ziegler, the referee concluded that, because the spouses executed separate releases and received separate payments from Peoples, they established a distinct and separate loss; thus, Employer had no right of subro-gation over those consortium settlements. Regarding the consortium settlements between Peoples and the spouses of Walker and Rayman, a different referee concluded that because there was no jury verdict or court ruling concerning the claims, they were subject to Employer’s right of subrogation.

Based upon the foregoing conclusions, the referees ordered each Claimant to pay immediately to Employer the gross amount of its accrued compensation lien and directed Employer to pay each Claimant its pro-rata share of expenses during the grace period until paid in full.⁶ The referees also granted Employer a suspension for the duration of the grace periods.⁷

Claimants and Employer appealed to the Board, which, in each case, amended the referee’s determination of Employer’s subro-gation interest. Specifically, the Board utilized the Gross Method and held that Claimants should have paid Employer the net amount of its accrued compensation lien, i.e., the compensation hen less allocated costs and fees. The Board calculated the expenses attributable to the accrued compensation Ken by dividing the Ken by the third-party recovery and then multiplying that percentage by the total costs of recovery.⁸

To calculate the grace period, the Board appKed the foUowing formula:

Recovery — Compensation Lien

Weekly Compensation Rate

The Board required Employer to reimburse Claimants during the grace period for its pro-rata share of the expenses attributable to the future compensation Ken. It held that Employer was entitled to a credit for any medical expenses incurred by Claimants during the grace period, to the extent that the settlement exceeds the accrued Ken less expenses attributable to the excess. The Board explained that as Employer receives a credit for the medical bflls, the total credit aKowed Employer wiK be equaKy reduced, thus reducing the grace period. The Board further indicated that Employer must reimburse Claimants a percentage of each medical biK representing Employer’s pro-rata share of the recovery expenses.

The Board also ruled that the consortium settlements of Claimants’ spouses were subject to Employer’s right of subrogation. The Board stated that Employer cannot be forced to abide by an agreement solely between the Claimants and the third-party defendant in the civil action which merely divides settlement amounts between the Claimants and their spouses. Finally, the Board approved legal fees in those cases where the issue was raised. The parties appealed and cross-appealed from the Board’s orders to this court.⁹

On appeal, the issues presented by the parties are whether the Board erred:

• in holding that Employer has a right of subrogation over the consortium settlements of Claimants’ spouses;

• in requiring Employer to reimburse its prorata share of expenses attributable to the accrued compensation lien at the time Employer collected its lien;

• in requiring Employer to reimburse Claimants weekly during the grace period the amount of legal expenses attributable to that grace period week; and

• in its treatment of the medical expenses incurred by Claimants during the grace period.

II.

A. Recovery for Loss of Consortium and Employer’s Subrogation Rights

As argued by Claimants, the courts of this Commonwealth have long recognized the right of both husbands and wives to recover damages for loss of consortium stemming from a tortious physical injury to a spouse. Dasconio v. Workmen’s Compensation Appeal Board (Aeronca, Inc.), 126 Pa.Cmwlth. 206, 559 A.2d 92, 99 (1989).¹⁰ Where such a claim is asserted, the losses alleged are personal to the uninjured spouse and arise from the deprivation of the injured spouse’s society and services. Id. However, it is the claimant’s burden to prove the amount of a settlement or award attributable to loss of consortium by having that issue determined in the third-party action. Id. 559 A.2d at 100.

The amount attributable to a loss of consortium must be decided in the third-party action because, as this court stated in Dasco-nio:

[Tjhere is no authority or jurisdiction in the workmen’s compensation system for determining the amount of a wife’s consortium damages previously recovered in a common pleas proceeding. Such a determination is solely one for a jury in the common pleas proceeding; such common pleas issues are not cognizable by compensation authorities.

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Thus, the claimant’s failure to resolve this issue in the common pleas proceeding leaves him and his wife with a failed burden of proof with which we may not become involved_ Moreover, ... the workmen’s compensation insurer, an interested party as subrogor, would be entitled to due process as to such a determination.

Id.

Similarly, in Warner Lambert Company v. Workmen’s Compensation Appeal Board, 133 Pa.Cmwlth. 250, 575 A.2d 956, 959 (1990), we held that where there is no jury verdict or other cognizable ruling in the third-party matter fixing the amounts payable to a claimant and to the spouse, the full amount recovered is subrogable because there is no basis for the workers’ compensation system to determine the appropriate share. We have also noted that an agreement between the claimant and the employer designating the amount recovered for the consortium claim could be recognized by the workers’ compensation authorities. Bell Telephone Company of Pennsylvania v. Workmen’s Compensation Appeal Board, 127 Pa.Cmwlth. 569, 562 A.2d 427, 429 (1989).¹¹

In this case, there was no adjudication of any of the issues in the tort action against Peoples and there was no agreement between the Claimants and Employer designating an amount for loss of consortium recovery. Because, as stated in Dasconio, the Employer or its insurer has an interest as subrogor, the agreement between the Claimants and Peoples cannot be recognized by the workers’ compensation authorities to limit the Employer’s right to subrogation.¹² For such settlements to be given a limiting effect on subrogation, the Employer or its insurer must have been given, at the very least, an opportunity to be involved in the negotiations and allocation of the loss of consortium recovery. Warner Lambert; Bell Telephone; Dasconio. Because there was simply an agreement between the Claimants and Peoples, without an adjudication by an impartial factfinder nor any concurrence by Employer in the allocation of the loss of consortium recovery, there was no cognizable determination of the consortium amount that could be relied on by the workers’ compensation authorities for exclusion from the Employer’s right to subrogation. Accordingly, we affirm the Board’s determination that the entire settlement amount is subject to Employer’s right of subrogation.¹³

B. Apportioning the Expenses on the Accrued Compensation Lien

Employer contends that the Board erred in requiring it to reimburse its pro-rata share of the expenses attributable to the accrued compensation lien at the time it collects its accrued lien. An employer’s right of subrogation and responsibility for expenses is set forth in Section 319 of the Act, which provides in pertinent part:

Where the compensable injury is caused in whole or in part by the act or omission of a third party, the employer shall be subrogated to the right of the employe ... against such third party to the extent of the compensation payable under this article by the employer; reasonable attorney’s fees and other proper disbursements incurred in obtaining a recovery or in effecting a compromise settlement shall be prorated between the employer and employe.... The employer shall pay that proportion of the attorney’s fees and other proper disbursements that the amount of compensation paid or payable at the time of recovery or settlement bears to the total recovery or settlement.

77 P.S. § 671.

Employer asserts that the Board erred in applying the Gross Method to calculate its subrogation interest because this method, contained in the Bureau’s Form LIBC-380 and utilized by this court in numerous decisions,¹⁴ is inconsistent with the statutory requirements and language of Section 319 of the Act. We disagree.

Contrary to Employer’s argument, the statute provides that when a claimant reimburses an employer from a third-party recovery or settlement the amount of compensation that the employer has paid to the claimant, the employer must bear its proportionate share of the legal fees and costs expended by the claimant to repay the employer. Because the claimant necessarily incurred certain expenses in obtaining the recovery or settlement, to the extent that the employer benefits from the third-party recovery or settlement, the claimant should not be required to bear the burden of the associated costs.

As recognized by this court in Pendleton: [I]n most cases the tort attorney will have been entitled to retain the legal fees and costs as soon as the settlement or judgment amount is paid. Normally, only the net amount remaining will be actually available for the claimant and subrogation.

625 A.2d at 190. It logically follows that an employer should bear its fair share of the legal expenses at the same time that it receives payment of its accrued compensation lien. See Allegheny Beverage Corporation v. Workmen’s Compensation Appeal Board (Wolfe), 166 Pa.Cmwlth. 646, 646 A.2d 762, 764, 768 (1994) (in traditional subrogation cases, the among of the employer’s lien is reduced proportionately by the attorney’s fees and costs incurred in obtaining the settlement).¹⁵

We acknowledge that this result is contrary to that reached by Rollins, where our Supreme Court, utilizing the Net Method, directed a claimant to pay the employer the gross amount of its accrued compensation lien and ordered the employer to reimburse the claimant its share of expenses in weekly installments over the grace period. We note, however, that the claimant in Rollins did not assert and, therefore, did not preserve a claim to be reimbursed for the expenses attributable to employer’s accrued lien at the time the employer received its actual repayment.

As recognized by this court in Pendleton, the claimant in Rollins was content to allow the employer to take the gross repayment of its accrued lien without any deduction for the legal expense of obtaining it. As such, the Supreme Court “had no choice except to deduct all of the legal expenses — as well as all of the accrued lien — before determining the balance of recovery for the grace period-” Pendleton, 625 A.2d at 193 (emphasis in original). See also USX Corp. v. Workmen’s Compensation Appeal Board (Backos), 147 Pa.Cmwlth. 59, 606 A.2d 1259, petition for allowance of appeal denied, 533 Pa. 603, 617 A.2d 1276 (1992) (because the employer did not preserve the right to pursue use of the gross method, the court was constrained to review the application of the net method as used by the referee and the Board); Baus v. Workmen’s Compensation Appeal Board (Nelson Co.), 137 Pa.Cmwlth. 121, 585 A.2d 573 (1991) (where the claimant did not preserve any claim seeking to apply the gross recovery approach, the court did not consider the gross method); Dasconio (because neither the claimant nor the employer preserved any issue concerning methodology, the court could not consider possible advantages of the bureau method).

Because Claimants (like the claimant in Pendleton) preserved for appeal their statutory claim to be reimbursed for the expenses attributable to the accrued compensation lien at the time that Employer received its repayment, the Board did not err in so directing the parties.

C. Necessity of Future Compensation Payments

Employer contends that the Board erred in requiring it to reimburse Claimants weekly during the grace period the amount of legal expenses attributable to that grace period week. Section 319 of the Act addresses the disposition of any balance that may remain after a claimant repays his employer the amount of its accrued compensation lien as follows:

Any recovery against such third person in excess of the compensation theretofore paid by the employer shall be paid forthwith to the employe ... and shall be treated as an advance payment by the employer on account of any future installments of compensation.

This sentence of Section 819 must be read in conjunction with a prior sentence requiring “reasonable attorney’s fees and other proper disbursements incurred in obtaining a recovery or ... settlement shall be pro-rated between the employer and employe.”¹⁶ Because an employer continues to benefit from the third-party action in those cases where the recovery is large enough to satisfy all or part of the employer’s future compensation obligation, it naturally follows that attendant with this benefit is an employer’s obligation to pay its share of expenses attributable thereto.

Even though Employer concedes it must pay a portion of the expenses of recovery, it maintains that it should be given the benefit of the Net Method which, it asserts, would charge it for a smaller share of expenses. Employer argues that because the Board applied the Gross Method in computing its subrogation rights, it was improperly charged with more than its pro-rata shares of the expenses incurred in each Claimant’s civil recoveries.

When the Net Method is used to calculate the grace period as to future compensation, an employer receives a shorter grace period, but correspondingly, has no obligation to weekly reimburse legal expenses attributable to the third-party recovery amount that makes the grace period possible. Bans.17 The Board determined that the Gross Method was more appropriate, however, resulting in a longer grace period but requiring Employer to reimburse Claimants during the grace period its pro-rata share of the expenses attributable to the future compensation lien.¹⁸ The Gross Method provides, consistent with the statute, that an employer reimburse the employee for the expenses attributable to the benefit it receives — each grace period week. In addition to complying with the statutory requirement for reimbursement of the expenses attributable to the grace period, as recognized by this court in Dasconio, the true genius of this method is that:

it takes account of that most elusive factor in our calculations, the time-value of money. By paying the claimant each week a proportional share of fees and costs, the value, although not the actual amount, of the payments decreases over time in lock step with the depletion in the value of the employer’s credit.

559 A.2d at 102 quoting William J. McKee, Workers’ Compensation, XII Pa. Law Journal-Reporter, No. 12, pp. 8, 4. Therefore, we conclude that the Board’s application of the Gross Method in these cases was not in error.¹⁹

D. Reimbursement of Medical Expenses Incurred by Claimants During Grace Periods

Employer also contends that the Board erred in its treatment of medical expenses incurred by Claimants during the grace period. Addressing medical expenses during the grace period in Dasconio, we stated:

[i]n considering general methods for handling future medical expenses (in as-yet-undetermined amounts) in these cases, there can either be a requirement (1) that the employer pay medical expenses, as they arise, by making additional cash payments to the claimant, or (2) that any newly arising medical expenses be charged against the employer’s grace period credit, with the necessary result of reducing the number of weeks of the grace period.

559 A.2d at 104.

In these cases, the Board opted for the second approach. Specifically, the Board charged each Claimants’ future medical expenses against Employer’s grace period credit, thus reducing the number of weeks in each grace period. The Board then, pursuant to the Gross Method, required Employer to reimburse Claimants a percentage of each medical bill representing Employer’s pro-rata share of the expenses incurred by Claimants to create that part of the grace period.

While Claimants acknowledge that this approach is consistent with the Board’s treatment of pre-settlement medical expenses and the Board’s use of the Gross Method for defining and calculating the grace period, they nonetheless submit that the preferred method is the first alternative, that the employer pay the medical expenses as they arrive.²⁰ We recognize that paying medical bills as they arrive may be preferable and simpler to the Employer because the number of weeks in the grace period would remain constant. However, because both methods have been approved by this court, we cannot conclude that the Board erred in requiring that newly arising medical bills be charged against Employer’s grace period, particularly where it is consistent with the Board’s previous use of the Gross Method.²¹

III.

Based upon the foregoing discussion, we conclude that the Board did not err (1) in concluding that the Employer has a right of subrogation over the “consortium settlements” of Claimants’ spouses, (2) in requiring Employer to reimburse each Claimant its pro-rata share of expenses attributable to the accrued compensation lien at the time Employer collected its lien, (3) in requiring Employer to reimburse each Claimant weekly during the grace period the amount of legal expenses attributable to that grace period week, and (4) in its treatment of the medical expenses incurred by Claimants during the grace period. Accordingly, we affirm.

ORDER

AND NOW, this 12th day of June, 1996, in the cases of Donald Reed, Neil Rayman, Richard Walker, and Donald Ziegler, we affirm the order of the Workmen’s Compensation Appeal Board.

In the case of James Walker, we remand the case to the Board so that it may amend its order to direct Employer to reimburse Claimant weekly during the grace period the amount of legal expenses attributable to that grace period week. With respect to all other matters in that case, we affirm. Jurisdiction relinquished.

McGINLEY, J., did not participate in the decision of this case.

1 . This case was reassigned to the authoring judge on March 12, 1996.

2 . Henry Hitechew also petitioned for review of the Board's order regarding Employer's subrogation interest in his civil settlement, and Employer cross-petitioned. However, these petitions were subsequently withdrawn.

3 . With the exception of Richard Walker, all Claimants were married.

4 . For the various Claimants, the settlements were constructed as follows:

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5 . Applying these principles, the referees calculated the grace period as follows:

Recovery — Expenses—Compensation Lien

Weekly Compensation Rate

The referees then calculated Employer’s pro-rata share of expenses using the following formula:

Compensation Lien x Expenses

Recovety

6 . In the case of James Walker, Claimant would not have received full reimbursement of Employer’s pro-rata share until 892.53 weeks of the grace period had passed.

7 . With the exception of the Ziegler order, the referees’ orders did not address medical expenses incurred by each Claimant during the grace period. In addition, the Ziegler order was the only order to address the Claimants’ legal fees.

8 . The same result is achieved by dividing the costs of recovery by the total recovery and then multiplying that percentage by the accrued compensation lien.

9 . Our scope of review is limited to determining whether constitutional rights were violated, an error of law was committed, or whether necessary findings of fact are supported by substantial evidence. Bethenergy Mines, Inc. v. Workmen's Compensation Appeal Board (Skirpan), 132 Pa.Cmwlth. 277, 572 A.2d 838 (1990), affirmed, 531 Pa. 287, 612 A.2d 434 (1992).

10 . See also Hopkins v. Blanco, 457 Pa. 90, 320 A.2d 139 (1974) (holding that because a husband had a right to recover for loss of consortium as a result of a tortious injury to his wife, the Equal Rights Amendment to the Pennsylvania Constitution, Pa. Const. Art. I, § 28, requires that a wife be allowed to recover for such a loss as well).

11 . Again, in Pendleton v. Workmen’s Compensation Appeal Board (Congoleum Corp.), 155 Pa.Cmwlth. 440, 625 A.2d 187, 189 (1993), we refused to reduce the subrogable amount to reflect a loss of consortium because there was nothing in the record on which to base such a determination, citing the holdings in Dasconio, Bell Telephone and Warner Lambert, that without an agreement between the claimant and employer or any adjudication on the consortium amount, there can be no exclusion from subrogation.

This view of the proof required for a loss of consortium recovery to be excluded from workers’ compensation subrogation is supported by decisions in other states. See Shimabuku v. Montgomery Elevator Company, 79 Hawaii 352, 903 P.2d 48 (1995) (a loss of consortium claim will be given legal effect only when fully and fairly determined by an impartial trier of fact or where the employer or insurer participated in the settlement negotiations); Henning v. Wineman, 306 N.W.2d 550 (Minn.1981) (a consortium settlement is not recoverable so long as the employer was notified of negotiations leading to such a settlement so that it could choose to intervene to protect its interest); Dearing v. Perry, 499 N.E.2d 268 (Ind.App.1986) (a claim for loss of consortium will be given legal effect only when fully and fairly determined by an impartial trier of fact or where the insurance carrier has the opportunity to participate in the settlement negotiations).

12 . Although the opinion in Pendleton mentions in dicta that in that case, there was only a unilateral assertion by the claimant without even an agreement between the claimant and the third-party tortfeasor about a loss of consortium recovery, it was not a determination that the workers’ compensation authorities could recognize an agreement between the claimant and a third party without the involvement of the employer or its insurer.

13 . We urge the legislature to address the issue by removing the need for judicial approval to more fairly allow the apportionment of loss of consortium claims, perhaps by declaring that a certain percentage of a total third-party settlement will be allocated to loss of consortium for married claimants.

14 . See Pendleton; CNA Insurance Co.; Bell Telephone Co.

15 . In Allegheny Beverage, the traditional subrogation method could not be applied in its entirety because, unlike in these cases, the claimant would receive monthly settlement payments for the rest of his life, resulting in the fact that the employer would never receive the benefit of the full settlement, and the full value of the settlement could not be known forcing the court to rely on the minimum guaranteed payout of the settlement. Id. 646 A.2d at 767.

16 . Sections 1922 and 1932 of the Statutory Construction Act, 1 Pa.C.S. §§ 1922 and 1932, require that all parts of the statute be effective and should be read in pari materia.

17 . We note that the Net Method and not the Gross Method “arguably subjects the employer to a double payment of legal expense — once when all the expenses are deducted to reduce the grace period and then again, in cash payments charged against the employer during the shortened grace period.” Pendleton, 625 A.2d at 193.

18 . Although the Board applied the Gross Method when computing the grace period in the James Walker case, the Board failed to order Employer to reimburse Claimant weekly during the grace period the amount of legal expenses attributable to that grace period week. Therefore, the Board’s order must be amended to correct this apparent oversight.

19 .Employer argues that it is possible it would have to pay all of the expenses incurred in the third-party settlement and that this was not intended by the Act. Because Employer would only pay all of the expenses incurred in the third-party settlement if it receives all of the benefit of that settlement, that is, if the claimant continues to be disabled after exhausting the grace period, we disagree. In that case, the expenses are prorated as required in the Act because the employer has received the benefit of the entire third-party recovery and the employee has received no funds not subject to subrogation. In addition, this court rejects Employer’s argument that the workers' compensation authorities are required to use the method preferred by an employer. We believe that the authorities should continue to strive for the result that is most fair to both parties.

We note that Employer also asserts that the Gross Method is an invalid means of calculating its subrogation interest because Bureau Form LIBC-380, which gives rise to the method, was adopted in violation of the "Commonwealth Documents Law,” Act of July 31, 1968, P.L. 769, as amended, 45 P.S. §§ 1201 — 1208. However, given our conclusion that the Gross Method is consistent with the statutory language of Section 319, we need not address this issue.

20 . In Claimants’ brief, the argument section pertaining to this issue is entitled, "The Board erred in requiring Employer to only pay a percentage of each medical expense incurred by the Claimants during the grace period while the Employer should be required to pay all of each medical expense." Claimants, however, do not fully develop this argument.

Our review of the Board's decision reveals that the Board indicated that the entire amount of each Claimants’ future medical expenses was to be charged against Employer’s grace period credit. In addition, the Board properly directed Employer to reimburse Claimants a percentage of each medical bill representing Employer’s pro-rata share of the recovery expenses. Therefore, we conclude that Claimants’ argument lacks merit.

21 . Employer also asserts that because there were no medical bills in dispute, the issue was not properly before the Board. We disagree. In order for the Board to define completely the relationship between Employer and Claimants after the third-party settlement, it was necessary that it resolve the treatment of post-settlement medical expenses.

Finally, Employer argues that a claimant should assume sole responsibility for the payment of his medical bills because these bills were, in part, the basis for his civil action. According to Employer, a compensation insurer should not be required to pay for any percentage of the third-parly tortfeasor’s negligence until the recovery is exhausted. Because Employer receives a benefit from excess third-parly recovery in relation to medical bills, as well as in relation to weekly compensation benefits, it cannot complain that the medical bill amounts are charged against its grace period.