SAIF Corp. v. Bales

360 P.3d 1281, 274 Or. App. 700, 2015 Ore. App. LEXIS 1285
CourtCourt of Appeals of Oregon
DecidedNovember 4, 2015
Docket1106366; A154979
StatusPublished
Cited by3 cases

This text of 360 P.3d 1281 (SAIF Corp. v. Bales) is published on Counsel Stack Legal Research, covering Court of Appeals of Oregon primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
SAIF Corp. v. Bales, 360 P.3d 1281, 274 Or. App. 700, 2015 Ore. App. LEXIS 1285 (Or. Ct. App. 2015).

Opinion

FLYNN, J.

Employer Coffman Excavation-Intel OCIP and its workers’ compensation insurance carrier, SAIF Corporation, seek review of an order of the Workers’ Compensation Board affirming the administrative law judge’s (ALJ) order awarding claimant attorney fees under ORS 656.386(l)(a). That statute requires the insurer to pay the claimant’s attorney fees in various circumstances, including, as pertinent here, when the insurer denies a claim for compensation and the claimant’s attorney is instrumental in obtaining rescission of the denial. We conclude that SAIF’s decision to pay for medical services it previously denied constituted a rescission of a denied claim for purposes of ORS 656.386(1), even though SAIF never withdrew the theory on which it based its original denial. SAIF does not dispute the finding that claimant’s attorney was instrumental in obtaining that rescission. Accordingly, we affirm.

I. BACKGROUND

We summarize the board’s pertinent factual findings, which SAIF does not challenge. Claimant suffered a compensable left knee injury in 2007, which SAIF accepted as a disabling medial meniscus tear. Claimant’s physician, Dr. Hanley, performed the surgery, and SAIF closed the claim. But claimant, who continued to experience symptoms, challenged the closure, and SAIF withdrew the notice of closure pursuant to an order on reconsideration.

In 2010, Hanley opined that claimant’s meniscus tear had caused a worsening of arthritis in claimant’s left knee. He performed a second surgery and also administered three injections to claimant’s left knee. SAIF again closed the claim and again rescinded its closure when ordered to do so, this time because claimant had become enrolled and was actively engaged in an authorized training program. See ORS 656.268(10) (describing claim processing procedures when worker becomes enrolled in an authorized training program).

A few months later, Hanley requested authorization to provide an additional series of injections to claimant’s left knee. Oregon Health Systems (OHS), the managed [702]*702health care provider overseeing claimant’s treatment, see ORS 656.260 (describing managed health care providers), declined to authorize the request. It explained that the requested injections were “not directed towards the accepted condition of: LEFT KNEE MEDIAL MENISCUS TEAR.” Claimant requested administrative review by the Medical Review Unit of the Workers’ Compensation Division of the Department of Consumer and Business Services, ORS 656.245(6).1 SAIF responded with a letter to the Medical Reviewer in which it explained that it denied the payment for the injections because “the requested injections are not directed to the accepted medial meniscus tear. Rather, *** they are related to degenerative medial compartment changes of an arthritic nature that have not yet been claimed or accepted as a new or omitted medical condition.” The Medical Review Unit referred the matter to the Hearings Division of the board, pursuant to ORS 656.704(3)(b)(C) and (5),2 because it determined that the dispute involved a question of medical causation.

Several months later, Hanley responded to an inquiry from SAIF by expressing his opinion that the injections were intended to treat arthritis in claimant’s left knee and that claimant’s meniscal injury accelerated the arthritis. Claimant then sent SAIF a written request to add the arthritis as an accepted condition. SAIF issued a modified notice of acceptance that included the arthritic condition and then paid for the injections.

[703]*703Because SAIF had accepted claimant’s arthritic condition and had paid for the requested injections by the time the dispute came up for hearing before the Hearings Division of the board, SAIF argued to the ALJ that the issues presented for hearing were moot. The ALJ apparently rejected SAIF’s mootness argument and found that the proposed injections were causally related to the accepted claim because claimant’s arthritis had become an accepted condition on an accepted claim. The ALJ further concluded that claimant was entitled to insurer-paid attorney fees under ORS 656.386(1) and costs under ORS 656.386(2).3

On appeal to the board, SAIF no longer argued that the compensation dispute was moot, but asserted that claimant had not prevailed over or obtained a rescission of SAIF’s original denial, as required for an award of fees under ORS 656.386(l)(a). SAIF argued that “the denial of a relationship between claimant’s medial meniscus tear and the synvisc injections was correct and has never been rescinded.” The board rejected SAIF’s argument.

II. ANALYSIS

The question presented to the board, and to us on judicial review, is whether ORS 656.386(1) authorizes the award of attorney fees to claimant. That statute provides, as pertinent to the present dispute, that, “[i]n all cases involving denied claims * * * where an attorney is instrumental in obtaining a rescission of the denial prior to a decision by the [ALJ], a reasonable attorney fee shall be allowed.”4 Because [704]*704there is no dispute that SAIF agreed to pay for the disputed injections prior to a decision by the ALJ, or that claimant’s attorney was instrumental in bringing about that change, claimant’s right to recover a reasonable attorney fee for the medical services dispute in this case turns on two elements: (1) whether the case involved a denied claim and (2) whether SAIF’s decision to pay for the disputed medical services amounted to a “rescission of the denial.” As it involves a matter of statutory construction, we review the question of claimant’s entitlement to attorney fees under ORS 656.386(1) for legal error. ORS 183.482(8); SAIF v. Wart, 192 Or App 505, 507, 87 P3d 1138, rev den, 337 Or 248 (2004).

A. Denied Claim

On judicial review, SAIF argues that its refusal to pay for the injections did not result in a “denied claim” for purposes of ORS 656.386(1).5 We disagree.

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Related

SAIF Corp. v. Maldonado (In re Maldonado)
430 P.3d 580 (Court of Appeals of Oregon, 2018)
Schommer v. Liberty Nw. Ins. Corp. (In re Schommer)
429 P.3d 416 (Court of Appeals of Oregon, 2018)
De Los-Santos v. Si Pac Enterprises, Inc.
373 P.3d 1274 (Court of Appeals of Oregon, 2016)

Cite This Page — Counsel Stack

Bluebook (online)
360 P.3d 1281, 274 Or. App. 700, 2015 Ore. App. LEXIS 1285, Counsel Stack Legal Research, https://law.counselstack.com/opinion/saif-corp-v-bales-orctapp-2015.