Kisa P. Sthankiya | Rusin Law, Ltd.
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Clarifying the Scope of §12 Post-Award: The Employer’s Right to an Independent Medical Examination
In Card Dynamix, LLC v. Illinois Workers’ Compensation Commission, 2024 IL App (3d) 240319WC-U, the Workers’ Compensation Commission Division of the Illinois Appellate Court addressed a significant question concerning the scope and applicability of §12 of the Workers’ Compensation Act, 820 ILCS 305/1, et seq., in the context of post-award proceedings. Specifically, the court was asked to determine whether an employer retains the statutory right to compel an independent medical examination (IME) after an award granting the claimant ongoing prospective medical rights has been entered, particularly when the claimant seeks additional medical expenses that may not fall squarely within the original award.
The claimant, a 56-year-old quality sample inspector for a plastic manufacturing company, suffered a significant lower back injury in 2013 while pushing a heavily loaded cart. MRI imaging revealed a lumbar disc bulge, and subsequent treatment included a laminectomy and spinal fusion at L5-S1. The treating orthopedic surgeon, Dr. Mark Sokolowski, oversaw the claimaint’s care over several years, prescribing pain medications and recommending follow-up MRIs.
After conservative treatments proved ineffective, the claimant underwent surgery and continued to require ongoing care and prescriptions. In 2017, an arbitrator awarded her 35 percent permanent partial disability under §8(d)(2) of the Act, ordered the employer to cover prospective medical care under §8(a), and left medical rights “open.” 2024 IL App (3d) 240319WC-U at ¶3.
After the arbitration award, the claimant returned to Dr. Sokolowski for at least eight follow-up visits between December 2017 and February 2021, during which he continued prescribing pain medication, including hydrocodone. On August 10, 2018, due to the claimant’s persistent lumbar pain and radiculopathy, Dr. Sokolowski referred her to Dr. Kalina, a pain management specialist, for long-term pain management. The claimant began treatment with Dr. Kalina on August 20, 2018, and continued through at least June 2021. Dr. Kalina’s care included addressing conditions such as neck pain and the aftermath of a stroke — ailments not clearly addressed by the original award or directly linked to the claimant’s work injury. All related medical bills were submitted to Travelers Insurance Company.
Travelers initiated a utilization review to assess whether the pain management medications prescribed by Dr. Sokolowski after the arbitration were appropriate and consistent with evidence-based standards. However, Travelers failed to provide the reviewing doctors with complete information, including the arbitration award granting the claimant prospective medical care. As a result, some reviewers denied medications that Dr. Sokolowski had already prescribed and that the arbitrator had approved. Despite Dr. Sokolowski’s repeated requests for a peer-to-peer review, a right guaranteed under the Act, neither Travelers nor the reviewing physician responded. Additionally, Travelers failed to pay for a prescribed drug even after approval by its own reviewing physician. Drs. Sokolowski and Kalina also documented the claimant’s ongoing need for a new MRI of her lumbar fusion site, which Travelers did not authorize. The MRI was eventually performed over four years after it was first recommended, paid for by the claimant’s group insurance carrier in January 2021.
The employer’s insurer, Travelers, declined to pay for these treatments without first conducting an IME to determine causation and medical necessity. The claimant refused to submit to the IME, contending that §12 does not authorize an employer to demand an IME in a post-award enforcement proceeding.
The claimant filed a petition under §8(a) to compel payment of medical expenses and sought penalties and attorneys’ fees under §§19(k) and 16, respectively. The Commission partially granted the petition, ordering Travelers to pay for follow-ups and prescriptions by Dr. Sokolowski, as well as the MRI. The Commission focused on other language in the arbitrator’s decision, stating that the employer was liable for prospective medical treatment and expenses, “specifically, continuing follow-up visits with Dr. Sokolowski, a new lumbar MRI (but only if Dr. Sokolowski continues to order one) and continuing prescription medication, as required.” [Emphasis added by the court.] 2024 IL App (3d) 240319WC-U at ¶30. The Commission found that this statement limited the prospective medical care award to those particular treatments.
However, the Commission narrowly construed the scope of the original arbitrator’s award, concluding that it did not encompass Dr. Kalina’s treatments and found that Travelers had a right to conduct another IME under §12. Penalties and fees were awarded.
A partial dissent by Commissioner Doerries disagreed with the majority’s penalty calculation, arguing it should be based on the fee schedule, not the billed amounts.
The matter was appealed to the Will County Circuit Court, which reversed the Commission in part, finding that Travelers had no valid basis for denying treatment and expressing frustration over systemic barriers faced by claimants seeking enforcement of open medical rights. The court remanded for a recalculation of penalties and fees based on the full amount of unpaid medical bills.
On remand, the Commission complied with the circuit court’s order and issued a new decision. The employer’s subsequent appeal to the circuit court was rejected, and the Commission’s award was affirmed.
The appellate court rejected the claimant’s argument that the employer was not entitled to an IME post-arbitration award. Applying a de novo standard of review, it emphasized that the plain language of the §12 permits an employer to request an IME at “any time” to determine both “the nature, extent and probable duration of the injury” and “the amount of compensation which may be due the employee from time to time.” 2024 IL App (3d) 240319WC-U at ¶¶41 – 42. The court reasoned that the phrase “from time to time” reflects the legislature’s intent to extend the applicability of §12 beyond the initial adjudication of benefits, thereby encompassing ongoing disputes concerning medical treatment sought pursuant to an open medical award. 2024 IL App (3d) 240319WC-U at ¶42.
The court further noted that prospective medical expenses awarded under §8(a) may properly be viewed as a form of “compensation” within the meaning of §12 when they pertain to the treatment of disabling conditions causally connected to the work-related injury. Accordingly, the court concluded that Travelers was entitled to request an IME in this post-award context to evaluate whether the care provided by Dr. Kalina was necessary to cure or relieve the effects of the compensable injury and whether such care was within the scope of the prior award.
In reaching this conclusion, the court distinguished precedent that limited post-award IME rights to scenarios involving a potential change in disability status. It observed that while cases such as King v. Industrial Commission, 189 Ill.2d 167, 724 N.E.2d 896, 244 Ill.Dec. 8 (2000), addressed such circumstances, they nevertheless affirmed the broader proposition that the right to an IME does not terminate upon entry of a final award. The court thus rejected the claimant’s argument that §12 is inapplicable to proceedings aimed at enforcing prospective medical rights.
The claimant also contended that Travelers forfeited its right to an IME by failing to comply with §12’s procedural prerequisites, including reimbursing travel expenses and lost wages. The appellate court declined to reach the merits of this contention, finding that the claimant had forfeited the argument by failing to raise it before the Commission. In any event, the court deemed the argument unpersuasive, noting that even assuming Travelers had initially failed to meet its statutory obligations, such failure would not irrevocably bar it from obtaining an IME at a later time upon full compliance.
Turning to the issue of penalties under §19(k), the court held that Travelers’ refusal to pay for the disputed treatment rendered by Dr. Kalina was not unreasonable or vexatious. Given that some of the treatment involved conditions not clearly within the scope of the arbitration award or demonstrably related to the original injury, the insurer had a good-faith basis for withholding payment pending the IME.
However, the court agreed with the Commission that Travelers’ failure to pay for certain undisputed medical expenses — specifically, follow-up visits with Dr. Sokolowski, the treating orthopedic surgeon; a lumbar MRI; and continued prescriptions — was unreasonable and without justification. These services were plainly included within the scope of the arbitration award. As a result, the court affirmed the imposition of penalties and attorneys’ fees pursuant to §19(k) with respect to those expenses.
Finally, the court addressed the methodology for calculating penalties. While the Commission initially calculated penalties based on the full amount of the medical providers’ charges, the court held that the statutory fee schedule established under §8.2 governs the appropriate penalty base. The court found that Travelers preserved its right to have the penalties calculated using the fee schedule by introducing the relevant evidence into the record, and that it was not required to affirmatively request such calculation during the administrative proceedings.
The court reversed the circuit court and remanded the case to the Commission with instructions to assess penalties against Travelers based on the fee schedule outlined in §8.2 of the Act. Additionally, the Commission was directed to determine whether to award the claimant’s attorneys’ fees and costs against Travelers, as permitted by §16 of the Act. The court reinstated the Commission’s initial decision in all other respects, including its finding that Travelers was entitled to an IME and its penalty award limited to Travelers’ refusal to pay only for Dr. Sokolowski’s treatments, the prescribed medications, and the lumbar MRI.
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