Wendell Goss v. City of Crestwood Fire Department

Issued by THE LABOR AND INDUSTRIAL RELATIONS COMMISSION

(Modifying Award on Medical Fee Dispute)

**Injury No.:** 14-101759

**Medical Fee Dispute No.:** 14-01645

**Employee:** Wendell Goss

**Employer:** City of Crestwood Fire Department

**Insurer:** St. Louis Area Insurance Trust

**Health Care Provider:** St. Luke's Hospital

Pursuant to the provisions of § 287.140 RSMo and 8 CSR 50-2.030, the above-captioned award is submitted to the Labor and Industrial Relations Commission (Commission) for review under § 287.480 RSMo. We have reviewed the evidence, read the petitioner's brief, and considered the whole record. Pursuant to § 286.090 RSMo, we modify the award and decision of the administrative law judge. We adopt the findings, conclusions, decision, and award of the administrative law judge to the extent that they are not inconsistent with the findings, conclusions, decision, and modifications set forth below.

On May 25, 2017, St. Luke's Hospital (medical provider) filed its Application for Payment of Additional Reimbursement of Medical Fees (Application) with the Division of Workers' Compensation (Division).

On June 30, 2017, the Division mailed to the parties a Medical Fee Dispute Notice of Evidentiary Hearing advising that hearing would be held on medical provider's Application on July 25, 2017.

Employer/insurer did not file an answer to medical provider's Application, or attend the hearing on July 25, 2017, to present a defense.

On August 25, 2017, the administrative law judge issued an award concluding: (1) employer/insurer is liable to medical provider in the amount of $2,403.32 for unpaid medical fees; (2) employer/insurer is liable to medical provider in the amount of $480.60 in interest on the medical fees; and (3) employer/insurer is liable to medical provider in the amount of $750.00 in attorney's costs and fees pursuant to § 287.560 RSMo.

Insurer¹ filed a timely application for review alleging the administrative law judge erred because: (1) insurer was not provided notice of the hearing in accordance with § 287.520 RSMo; and (2) the award of pre-judgment interest is contrary to the mandate of strict construction under § 287.800 RSMo.

For the reasons stated below, we modify the award and decision of the administrative law judge referable to the issue of whether medical provider is entitled to prejudgment

¹ The application for review was filed by an attorney representing insurer only. For this reason, we refer solely to the insurer (as opposed to the employer/insurer) when addressing and resolving the arguments pending before us on appeal.

Injury No.: 14-101759

Medical Fee Dispute No.: 14-01645

Employee: Wendell Goss

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interest on the award of medical fees. We additionally supplement the decision of the administrative law judge in order to address insurer's argument it was not provided adequate notice of the proceedings before the Division.

**Discussion**

**Notice of proceedings before the Division**

As recounted in the procedural history set forth above, employer/insurer failed to attend the hearing before the administrative law judge on July 25, 2017, and thus did not present a defense of any kind in this matter. Insurer argues that its failure to attend the hearing should be excused, however, because the Division's Notice of Evidentiary Hearing was not given in accordance with § 287.520 RSMo, where the hearing was set fewer than 30 days from the date of the notice.

Section 287.520 RSMo provides, in relevant part, as follows:

> Any notice required under this chapter shall be deemed to have been properly given and served when sent by registered or certified mail properly stamped and addressed to the person or entity to whom given, at the last known address in time to reach the person or entity in due time to act thereon, or to counsel for that person or entity in like manner.

On the topic of proceedings, like this one, involving a medical fee dispute, Division rule 8 CSR 50-2.030(1)(K) provides, in relevant part, as follows:

> The evidentiary hearing shall be held at a place and time to be set by the division. The division shall notify all parties as to the time and place of the hearing. An administrative law judge may continue the hearing for good cause.

Neither the plain language of § 287.520 or the relevant Division regulation required the Division to send the notice of evidentiary hearing 30 days or more prior to the date set for hearing.² Instead, the Division was statutorily required under § 287.520 to furnish notice to the parties "in due time to act thereon." The question before us is whether the Division did so.

The record before us includes copies of the Medical Fee Dispute Notice of Evidentiary Hearing, Certified Mail Receipts including tracking numbers for the separate notices mailed to both employer and insurer, and USPS Tracking Results corresponding to said tracking numbers. Together, these records constitute prima facie evidence that the Division mailed the notice to employer and insurer on June 30, 2017.³ We credit this

² By way of contrast, in the context of proceedings in contested workers' compensation cases involving injured employees, Division rule 8 CSR 50-2.010(9)(C) provides that "[t]he parties shall be notified of the date, time and place of any setting at least ten (10) days prior to the setting."

³ Division rule 8 CSR 50-2.010(12)(C) provides that "[t]he records of the division shall constitute prima facie evidence of the date of mailing of any notice, determination, award or other paper mailed pursuant to Chapter 287, RSMo." Insurer does not argue that the Division used incorrect addresses for employer or insurer.

Injury No.: 14-101759

Medical Fee Dispute No.: 14-01645

Employee: Wendell Goss

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evidence, and find that the Division mailed the notice to employer and insurer on June 30, 2017.

Indeed, insurer, in its brief, concedes employer received the notice on July 3, 2017.4 Nevertheless, insurer argues that the notice was defective, because it contained erroneous information. Specifically, insurer points out the notice incorrectly states that it was "sent 8 weeks before the date of the hearing" and that employer/insurer was required to "file an answer within thirty (30) days from the date of [the] notice," where that 30-day period would have ended six days after the hearing was set. Transcript, page 12.

While we recognize this obvious error, and acknowledge that it likely prompted some confusion, insurer's application for review and brief wholly fail to explain why this error excused employer/insurer of the obligation to either respond to the notice before July 25, 2017, or to attend the hearing before the Division on that date. If employer and/or insurer were confused as to the meaning of the notice and their obligations with respect thereto, it would appear that nothing prevented their representatives from contacting the Division to note the error and to present an objection to the Division's scheduling the hearing on July 25, 2017. In our view, a reasonable party would contact the Division to seek clarification upon receipt of a notice from the Division that contained confusing or conflicting information, rather than ignore the notice until after the passing of the hearing date. Based on the record before us, and because insurer does not so allege in either its application for review or brief, we find that insurer did not seek clarification of the meaning of the notice, or file any objection to the scheduling of the hearing, at any time before July 25, 2017.

In light of these circumstances, and because insurer concedes employer had actual notice of the hearing at least as of July 3, 2017, we conclude the Division provided notice of the hearing "in due time to act thereon" for purposes of § 287.520 RSMo. For this reason, we decline to burden the Division or the opposing party with an order remanding this matter to the Division for additional evidentiary proceedings.

Prejudgment interest on an award of medical fees pursuant to § 287.140.4 RSMo

Medical provider seeks prejudgment interest on the unpaid medical fees at issue in this matter. The administrative law judge concluded that McCormack v. Stewart Enters., 956 S.W.2d 310 (Mo. App. 1997) authorizes an award of prejudgment interest on an award of medical fees in the context of a proceeding pursuant to § 287.140.4 RSMo on a medical provider's Application for Payment of Additional Reimbursement. Insurer appeals, arguing that McCormack cannot be applied in this matter to support the award of interest. After careful consideration, we agree, for the following reasons.

4 While conceding that employer received the notice, insurer argues in its brief that the record before us contains only the notice itself, which would be insufficient to support a finding the notice was mailed, citing Weston Transp. v. Sharp, 926 S.W.2d 219 (Mo. App. 1996), instructing that "[t]he presence of a letter in the court's file is not proof the letter was mailed to the address." However, as we have noted, the record does not consist of only the notice itself, but additional records that constitute prima facie evidence of mailing. In any event, pursuant to § 287.300 RSMo, "[s]ervice on the employer shall be sufficient to give the division or the commission jurisdiction over the person of both the employer and his insurer."

Injury No.: 14-101759

Medical Fee Dispute No.: 14-01645

Employee: Wendell Goss

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Section 287.140 RSMo authorizes the Division and Commission to entertain and resolve certain disputes between medical providers and employer/insurers over the payment of medical fees and charges. Specifically, § 287.140.13(5) RSMo provides as follows:

If an employer or insurer fails to make payment for authorized services provided to the employee by a hospital, physician or other health care provider pursuant to this chapter, the hospital, physician or other health care provider may proceed pursuant to subsection 4 of this section with a dispute against the employer or insurer for any fees or other charges for services provided.

Meanwhile, § 287.140.4 RSMo provides as follows:

The division shall, by regulation, establish methods to resolve disputes concerning the reasonableness of medical charges, services, or aids. This regulation shall govern resolution of disputes between employers and medical providers over fees charged, whether or not paid, and shall be in lieu of any other administrative procedure under this chapter. The employee shall not be a party to a dispute over medical charges, nor shall the employee's recovery in any way be jeopardized because of such dispute. Any application for payment of additional reimbursement, as such term is used in 8 CSR 50-2.030, as amended, shall be filed not later than:

(1) Two years from the date the first notice of dispute of the medical charge was received by the health care provider if such services were rendered before July 1, 2013; and

(2) One year from the date the first notice of dispute of the medical charge was received by the health care provider if such services were rendered after July 1, 2013. Notice shall be presumed to occur no later than five business days after transmission by certified United States mail.

The Division has promulgated the regulations referenced in the foregoing language; these are set forth at 8 CSR 50-2.030. We have carefully searched the statutory and regulatory provisions applicable to this matter. Nowhere within these controlling statutory and regulatory provisions do we find any authorization, express or implied, for an award by the Division or Commission of prejudgment interest in favor of a medical provider in the context of proceedings pursuant to § 287.140.4.

We acknowledge that in McCormack v. Stewart Enters., 956 S.W.2d 310 (Mo. App. 1997), and in a number of subsequent cases, the courts have authorized awards of pre