Gerson v. Industrial Accident Commission

188 Cal. App. 2d 735, 11 Cal. Rptr. 1, 1961 Cal. App. LEXIS 2481

Opinions

NOURSE, J. pro tem.

Footnotes

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Petitioner is an applicant before the respondent commission for workmen’s compensation. By her petition here she seeks to annul that part of the award made by respondent commission which ordered that a portion of the amount awarded to her on account of self-procured medical and hospital expenses be paid directly to Hospital Service of Southern California, hereinafter called “Blue Cross. ’ ’ The relevant facts are:

On December 6, 1958, petitioner, hereinafter sometimes called “applicant,” sustained an injury to her spine while in the scope and course of her employment by Harriman-J ones Clinic, hereinafter called “the clinic.” She received treatment from the medical staff of the clinic and on February 16, 1959, entered the hospital operated by the clinic but she did not, until February 26, 1959, advise her employer of the accident occurring on December 6th and made no claim that her illness and injuries were due to that accident until February 26th.

At the time of the accident petitioner’s husband was a dues-paying contributor under a plan of hospital and medical service contracted for by his employer with Blue Cross and under which Blue Cross agreed to furnish certain hospital, medical and surgical services to the dues-paying members of the employer and their families. The contract between Blue Cross and the husband’s employer specifically excluded from the services which Blue Cross would be obligated to furnish “any condition for which indemnities are recoverable under any Workmen’s Compensation or Occupational Disease Law. ...”

At all relevant times the clinic was under contract with the Blue Cross to furnish hospital service and care to Blue Cross hospital service plan subscribers upon the terms and conditions stated in that contract. Petitioner was the holder of a certificate designating her as a member of her husband’s family entitled to the benefits of the contract between her husband’s employer and Blue Cross. Relying on this certificate, the clinic and the physicians and surgeons who attended petitioner billed Blue Cross for the services rendered to petitioner and their bills were paid by Blue Cross.

On August 3, 1959, petitioner filed her application with respondent commission for workmen’s compensation benefits and it was not until the filing of this application that Blue Cross received notice that petitioner’s injury was industrial in character and that she was entitled to indemnity under the workmen’s compensation insurance act. It thereafter filed with the commission its claim of lien including the amounts paid out by it for services rendered to petitioner prior to February 26,1959.

The respondent commission on August 12,1960, after having granted reconsideration of a former award, entered its findings of fact and award and on the same day entered what it called its decision but which we understand to be a summary of the evidence relied on and the reasons or grounds for its award filed pursuant to section 5313 of the Labor Code.

By the award petitioner was granted, in addition to disability indemnity, reimbursement for the reasonable value of self-procured medical treatment incurred by her after February 26, 1959, including medical and hospital expense paid by Blue Cross but her claim for such expense, incurred prior to February 26, was denied. The award expressly denied the claim of lien filed by Blue Cross but ordered that, of the amount awarded petitioner for self-procured medical and hospital expenses, a portion thereof equal to the amount expended by Blue Cross should be paid directly to it.

Petitioner asserts: first, that the amounts paid by the Blue Cross were paid by it under its contract so to do for which it had received a consideration and that, therefore, the services furnished by it were the proceeds of an investment, payable irrespective of her right to indemnities under the workmen’s compensation act and that Blue Cross was not entitled to be reimbursed for the services that it had for a consideration contracted to furnish and that, consequently, the commission could not by its order reimburse it; second, that the commission was without jurisdiction to adjudicate the controversy between petitioner and Blue Cross.

There is no merit in the first point stated above. By the express terms of the contract made by Blue Cross and under which petitioner had the right to claim hospital service there was excluded from the coverage of that contract any hospital or medical service for which petitioner was entitled to indemnities under the workmen’s compensation laws.

Because of her failure to report the accident and request from her employer indemnification in the form of medical and hospital care under the workmen’s compensation provisions of the Labor Code, petitioner was not entitled to indemnification for expenses so incurred by her prior to February 26, 1959, and the commission so found. These expenses not being recoverable “under any Workmen’s Compensation or Occupational Disease Law” Blue Cross was obligated to furnish the services for which the expense was incurred under its contract and the commission by its award did not include them, in its award to petitioner or in the amount which it directed paid to Blue Cross.

Petitioner, however, was entitled to indemnity under the workmen’s compensation provisions of the Labor Code on account of medical and hospital services rendered to her after February 26, 1959, and Blue Cross was, therefore, not obligated under its contract to furnish them. The expenditures that Blue Cross made in furnishing hospital and medical care to petitioner after February 26 were made by mistake and not under the obligations of its contract and petitioner received them through mistake and not as a benefit to which she was entitled under her husband’s contract with Blue Cross and receipt of them did not amount to the return of an investment made by her husband under the rule laid down in Fireman’s Fund Indem. Co. v. Industrial Acc. Com., 170 Cal.App.2d 412 [339 P.2d 225], which is relied upon by petitioner.

The second point stated above is more difficult of solution. By its findings of fact the commission found that Blue Cross was not entitled to a lien and by its award denied that lien. Section 4904, Labor Code, only grants to the commission the power to order the payment of an award made to the applicant for reasonable hospital and medical expense incurred by her, to a third person where it has determined and allowed, to that third person, a lien.

The commission has no power beyond that given it by section 21, of article XX of the Constitution of this state and the workmen’s compensation act (now div. 4 of the Lab. Code) passed by the Legislature pursuant to that provision of the Constitution. (State Comp. Ins. Fund v. Industrial Acc. Com., 89 Cal.App.2d 821, 824 [202 P.2d 86].)

The Legislature may empower the commission to exercise jurisdiction over controversies incidental to the award to an employee, but it cannot vest in the commission jurisdiction to determine controversies not incidental to such relief. (Pacific Employers’ Ins. Co. v. French, 212 Cal. 139 [298 P. 23]; State Comp. Ins. Fund v. Industrial Acc. Com., 20 Cal.2d 264, 267-269 [125 P.2d 42] ; Fireman’s Fund Indem. Co. v. Industrial Acc. Com., supra, 170 Cal.App.2d 412, 423.)

We are convinced, however, that Blue Cross was entitled to a lien under the provisions of paragraph (b) of section 4903 of the Labor Code and section 4600 of that code and that finding of the commission to the contrary is wholly unsupported by the evidence.

Section 4903, so far as pertinent reads: “The commission may determine, and allow as a lien against any amount to be paid as compensation: . . . (b) Medicine and Hospital Expenses. The reasonable expense incurred by or on behalf of the injured employee, as provided by Article 2 of Chapter 2 of Part 2 of this division.” Section 4600 reads in part as follows : “Medical, surgical, and hospital treatment . . . shall be provided by the employer. In the ease of his neglect or refusal seasonably to do so, the employer is liable for the reasonable expense incurred by or on behalf of the employee in providing treatment. ’ ’

While under its contracts Blue Cross was not obligated to furnish medical and hospital services to petitioner it did in fact furnish those services to her through the hospital and the doctors whom it employed and the fact that its employment of the hospital and the doctors occurred through mistake did not change the character of its acts.

Fireman’s Fund Indem. Co. v. Industrial Acc. Com., supra, 170 Cal.App.2d 412, is not applicable for under the facts here where there was neither a payment of money nor the furnishing of services pursuant to a contract so to do nor a loan of money to petitioner but simply a furnishing by Blue Cross of services to petitioner and the situation is no different than if the clinic and the physicians were the lien claimants. Under the facts here Blue Cross was clearly entitled to a lien within the provisions of sections 4903, subdivision (b), and 4600 of the Labor Code.

We have no power, in proceedings of this kind, to make findings of fact and the commission having found Blue Cross not entitled to a lien and having by its award denied that lien, its award directing payment of a portion of the award granted applicant directly to Blue Cross was an order in excess of its jurisdiction and cannot be sustained.

The award is annulled with directions to the commission to take such further proceedings not inconsistent with the views hereinbefore expressed as are warranted by the evidence before it.

Fox, P. J., concurred.

Assigned by Chairman of Judicial Council.