Commission Reverses Itself Re: Permanent Partial Disability Rating Payment Obligation

by Kevin W. Cloe and Imani Y. Price

On October 5, 2021, the Virginia Workers’ Compensation Commission reversed a long-standing policy concerning functional capacity evaluations, and the reversal is now final. For many years, the Commission held that payment of a functional capacity evaluation done solely for the purposes of establishing a permanent impairment rating is not the responsibility of the employer/carrier. The rationale always had been that this is not “reasonable or necessary medical treatment” as defined by Virginia Code § 65.2-603. This principle had been well-established, and carriers, for years, relied upon this principle to deny payment for FCEs where the sole purpose was to determine a permanency rating.

In the recent case of Elliott v. Sam Green Vault Corp., JCN: VA00001108316 (October 5, 2021), the Commission completely reversed itself on this policy. The Opinion, authored by Commissioner Newman, acknowledged the precedent that the Commission had set for many years regarding this issue, but flatly reversed this policy and departed from the previous precedent by holding, based upon four “principles,” that the burden of paying for an FCE done solely for an impairment rating should lie with the employer/carrier.

There was a well-written dissent from Commissioner Rappaport pointing to the deficiencies in the rationale presented. Most importantly, Commissioner Rappaport pointed out that nothing had changed with respect to a permanency rating not being “medical treatment” as defined by the Act.

Because of this dissent, and the obvious implications of this case, it seemed likely that this Opinion would be appealed to the Court of Appeals. A right of appeal existed to the Virginia Court of Appeals, which focuses on law-based appeals only, and we believe this would have been a perfect case for them to consider under their “credible evidence” standard of review.

However, we have learned that this Opinion was not appealed, and is now final. Accordingly, the law in Virginia has drastically changed on this topic and an employer/carrier must now pay for the claimant to obtain a permanency rating for his or her injury.

While this is a dramatic shift in Commission policy, the effect may not be as significant as it first seems. In the past, claimant attorneys have often forced employers/carriers to pay for these ratings from a practical standpoint by having their client examined by an independent physician who would assess an unreasonably high rating. This would force the employer/carrier, even if they denied payment of the rating itself, to then go out and either obtain an independent medical examination or have the claimant examined by the treating physician, which was the goal of the claimant in the first place. For this reason, the implications of this case are likely not to be as far reaching as one might think upon first glance. Nonetheless, it does demonstrate a drastic change in the Commission’s view on this topic.

We will keep you advised if and when an opportunity presents itself to contest this matter again and appeal one more level to the Virginia Court of Appeals. As always, please feel free to contact us with any questions or concerns.