Dividing future workers comp medical expenses between different insurers OK, Court says

On December 19, the Superior Court of New Jersey, Appellate Division, decided a workers’ compensation case involving different insurance companies that were appealing a decision from the Division of Workers’ Compensation apportioning responsibility for future medical expenses between them.

The facts, which were not disputed, show that the employee worked for AGFA, becoming totally and permanently disabled as a result of physical activities performed at work over a 23-year period. During that time, AGFA had workers’ compensation insurance with three different companies.

Initially, the employee’s osteoarthritis symptoms arose in 1994 while the employer carried insurance with Reliance.

Then in 2000, the employee had more symptoms while her employer carried insurance with ACE. Finally, in 2001, the employee’s condition arose again while AGFA had workers’ compensation insurance with Travelers.

A physician testified at trial that it would be impossible to determine exactly when the employee’s condition became permanent.

The Division of Workers’ Compensation judge apportioned responsibility between the three insurers upon determining that the employee’s work during the three different periods of coverage contributed equally to her disability.

Two of the three insurance companies argued that the workers’ compensation judge was wrong in apportioning responsibility for future medical expenses among all three insurers, because the judge could not have determined whether the employee needed future medical treatment during each of the three periods of insurance. Both Reliance and ACE thought that only Travelers, the last insurer, should pay for the employee’s future medical treatment, under the “last injurious exposure” rule. The Appellate Division disagreed.

The Appellate Division pointed out that when the onset date of the injury or disease cannot be determined, and the employment contributed to the injury or disease during each of the insurers’ coverage periods, apportionment among the different insurers may be appropriate.

Additionally, the insurers argued that the apportionment of responsibility for future medical expenses among three different insurers creates logistical problems.  These problems include the difficulty in having three different insurers choose a medical provider and pay for that provider’s services.

Dismissing the insurers’ argument about logistics as “meritless,” the Appellate Division said there is no rule stating that only the last insurer should pay future medical expenses whenever there is a logistical problem with payment and with choosing a physician. The Court added that the insurers could always apply to the Division of Workers’ Compensation for orders designating a treating physician and addressing payment terms for future medical expenses.

Natale v. Celanese, Inc., et al., Docket No. A-0840-07T1, Sup. Ct. NJ, App. Div. (2008).