By John Hollick, Chief Defense Counsel with SFM’s in-house law firm

The Minnesota Supreme Court addressed the statutory presumption of posttraumatic stress disorder (PTSD) in Juntunen v. Carlton County in December 2022, significantly impacting the criteria for compensability of certain workers’ compensation claims.

Generally, an injured employee has the burden to prove the elements of a workers’ compensation claim, including that the employee has an occupational disease. However, the state’s PTSD presumption under Minnesota Statute Section 176.011, Subdivision 15(d)(e) and effective January 1, 2019, relieves certain employees of at least part of the burden of proving that they suffer from a compensable occupational disease. Law enforcement employees are among the professions specifically included in the presumption.

In this case the employee, Doug Juntunen, worked as a deputy sheriff for Carlton County, during which time he claims he experienced several traumatic events, both professionally and personally. He was diagnosed with PTSD by a licensed psychologist in September 2019. The day after he received his diagnosis, the deputy informed his supervisors and was placed on leave. The employer and insurer later denied liability of Juntunen’s workers’ compensation claim, and the case went to litigation.

At a subsequent hearing, both sides presented differing medical opinions concerning Juntunen’s diagnosis. The treating provider felt that he did qualify for PTSD benefits, while the psychologist brought in by the insurer for an Independent Medical Evaluation (IME) felt that he did not meet all the requirements of PTSD, but rather suffered from severe depression.

The facts revealed that Juntunen had experienced several potentially traumatic experiences during his career, including events both at work and in his personal life. The IME doctor admitted that he was only relying on the employee’s symptoms for 30 days prior to the IME examination, however the compensation judge accepted the IME’s medical opinion and denied the claim for benefits based on a PTSD diagnosis.

The case was appealed, and the Workers’ Compensation Court of Appeals (WCCA) reversed the opinion. In December 2022, the Minnesota Supreme Court affirmed the reversal by the WCCA and awarded benefits for the PTSD diagnosis.

The PTSD presumption in Minnesota Statute 176.011, Subdivision 15(d)(e) states that an employee (1) must be employed in one of the enumerated occupations, (2) be diagnosed with PTSD by a licensed psychiatrist or psychologist, and (3) must not have been diagnosed with PTSD previously.

Once Juntunen offered a diagnosis of PTSD from a licensed psychologist, the PTSD presumption applied. This fact, along with the unchallenged findings of the compensation judge that Juntunen was a deputy sheriff and had no previous PTSD diagnosis, triggers the presumption that Juntunen had a compensable occupational disease.

Interestingly, in the opinion, the Minnesota Supreme Court stated that “ultimately, the PTSD presumption represents a balancing between two competing policies: prompt payment of employee’s medical expenses for PTSD treatment and stewardship of public monies. The legislature determined that employees suffering from PTSD need timely access to medical care, and the PTSD presumption puts the onus on employers to quickly resolve such claims.” As the IME did not evaluate Juntunen until 10 months after he notified Carlton County of his diagnosis, the Minnesota Supreme Court stated, “that is too long to leave employees’ benefits claims unresolved.”

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

Adapted from the “Avoiding Litigated Claims” webinar, available on our website at sfmic.com/webinars.

When an attorney gets involved in a workers’ compensation claim, it can increase claim costs and harm outcomes for everyone involved.

CLARA Analytics found that attorney involvement with workers’ compensation claims led to an average 388% increase in claim costs. Additionally, litigated claims remained open 195% longer than non-litigated claims, and workers stayed disabled longer when they were represented by an attorney, according to the CLARA Analytics study . Higher claim costs can result in higher future workers’ compensation premiums, and longer disability times harm employers and employees alike.

Once an employee is represented by an attorney, they’re no longer able to talk directly with their claims representative, creating a disconnect when managing the claim. The contentiousness can also ruin the relationship between the worker and their employer.

There are situations where litigation is unavoidable, such as when there are complex issues regarding what caused an injury, said SFM Senior Defense Counsel Tom Davern. But many times, there are steps employers can take that can help prevent workers feeling they need legal representation.

Why claims go into litigation

There are a few common reasons why injured workers choose to hire attorneys, according to SFM Claims Specialist Martha Crump:

• Fear of losing their job. They may be worried that they may not be able to perform their work duties due to the injury, or fear retaliation.
• Lack of communication. If the employee is off work due to the injury, and no one is reaching out to them, this can make them feel forgotten and leave them with unanswered questions.
• Pressure from coworkers. If an employee gets pushback or ridicule from coworkers while performing light-duty work, they may feel they need the added protection of a lawyer.
• Not understanding the workers’ compensation process. For example, the worker might not realize that if a medical treatment isn’t approved right away, that doesn’t mean it is denied.

Common causes of litigated disputes

There are a few common causes at the heart of litigated workers’ compensation claims, according to SFM Defense Counsel Peter Lindquist. Those are:

• Primary liability issues, such as disputes over whether an injury actually happened, or whether it’s compensable.
• Medical disputes, such as whether the requested medical treatment is reasonable, whether the injury is a contributing cause, whether the treatment is permitted by statute or whether doctors agree on the recommended treatment.
• Wage loss disputes, such as whether an employee’s refusal of a full-duty or light-duty job offer is reasonable, whether an ongoing reduction in earning capacity is related to the injury, whether a former employee is diligently job seeking, differing views on the extent of the injury’s impact, or conflicts over the wage rate and benefits due.

Other less common causes of workers’ compensation disputes are rehabilitation services (the nature, extent and cost of these services) and administrative issues, such as failure to file a claim or pay benefits on time.

Strategies to prevent litigation

There are a number of steps that employers can take to prevent the kinds of scenarios that cause workers to seek representation from an attorney.

Before an injury occurs, you can:

• Implement or review policies and procedures related to work injuries. This includes clarifying how to report work injuries, and who will work with injured employees as they recover.
• Develop a return-to-work plan. Think about how you will accommodate employees who have work restrictions so you can bring them back to work as soon as they are medically able. SFM provides resources to help you identify possible light-duty jobs.

After an injury occurs, you can:

• Provide reassurance. Assure injured workers that you will help them get back to work as they recover and provide them with light-duty work if necessary.
• Stay in contact. Have a designated person reach out to the employee on a regular basis to see how they’re doing and see if they have any questions about their claim or the return-to-work process.
• Anticipate questions. Encourage the employee to always reach out to their SFM claims adjuster for clarification or questions.
• Suggest using our online claim portal. Encourage the employee to register for the SFM Claim Connection portal, which will provide them with information on their claim and payments.
• Maintain policies and expectations. Make sure the employee knows your expectations, such as regular updates if they’re off work.
• Keep good documentation. Document the facts of the injury, how it was reported, witnesses, and any other details that might be important. Continue documenting any updates as the claim progresses.
• Accommodate work restrictions. Provide light-duty work that fits the employee’s medical restrictions so they can return to work as soon as medically possible.
• Take concerns about work restrictions or retaliation seriously. Make sure the employee is following any medical restrictions and promptly investigate any concerns about retaliation. Discourage and stop any ridicule from coworkers over light-duty work.
• Discuss other options. Provide information on any options that may be available to the employee such as a medical leave, the use of the Family and Medical Leave Act (FMLA) and short-term or long-term disability benefits.
• Think hard before terminating. If you’re considering termination, think through the possible ramifications before deciding. SFM and your agent can be resources to help you through these types of questions.

“We can’t overemphasize the need to communicate, communicate and communicate,” said Senior Defense Counsel Cheryl Bowsfield.

What if I have a litigated claim?

You can do all the right things, and still find yourself with a litigated claim. In these cases, it’s important to still follow the above steps to maintain a good relationship with the employee and help reach the best outcome possible.

To keep the relationship positive, you can avoid discussing the legal dispute by directing the employee to SFM.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

When you purchase a workers’ compensation insurance policy, a coverage called employer liability insurance is also included.

Sometimes called Part 2 or Coverage B, this insurance is rarely used in most states, and makes up a very small part of the workers’ compensation insurance premium.

Because of this, you might just pass over this coverage if not for the need to choose employer liability limits.

The basic employer liability limit is usually $100,000/$500,000/$100,000. That’s $100,000 per accident, $500,000 per policy, and $100,000 per employee.

Since an employer liability claim is unlikely, other considerations usually factor into decisions to increase the limits above the basic $100,000/$500,000/$100,000 level.

What employer liability insurance covers

There are only a few rare cases where employer liability insurance coverage might be used by a policyholder.

Some states permit spouses and dependents of injured employees to sue an employer. Employer liability insurance would provide coverage in those cases.

A more common (but still rare) example of when employer liability limits might be used is when an injured employee sues a negligent third party, and that third party sues the employer for contributory negligence.

For example, say a factory worker was injured while using machinery that his employer purchased from another company, and the employee claims the manufacturer was to blame for the injury. The employee might try to sue the manufacturer for damages. The manufacturer might then sue the employer saying the machine had not been properly maintained or the employee wasn’t properly trained to use the equipment. This is called a third party over action. At that point, the employer liability insurance would cover the employer’s possible settlement and damages costs up to the stated policy limits. The employer liability insurance would also cover defense costs until the policy limits have been met by settlement or damages payments. Defense costs are paid outside the policy limits.

Just as with the workers’ compensation insurance portion of the policy, a claim can only be eligible for coverage under the employer liability portion if it stems from an injury determined to be work-related, as defined by state statute.

Choosing employer liability limits

The basic employer liability limit is usually $100,000/$500,000/$100,000.

Oftentimes policyholders who choose to increase their limits do so because of contractual requirements or requests from their umbrella carrier.

For example, a general contractor might require all subcontractors to set their employer liability limits at a particular level. Or, a policyholder’s general liability or umbrella carrier might have similar requirements and ask for increased limits.

For those reasons, it is common to see employer liability limits increased to $500,000/$500,000/$500,000 or $1 million/$1 million/$1 million.

Because the coverage is rarely used, increasing coverage limits is typically inexpensive.

For example, the cost to raise the limits to $500,000/$500,000/$500,000 is 0.8 percent of premium in most states. The cost to increase the limits to $1 million/$1 million/$1 million is 1.1 percent of premium in most states.

Employer liability limits can be confusing, and every policyholder is different, so consult with your agent if you have questions about your specific situation.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

By Cheryl Howland Bowsfield, Senior Defense Counsel with SFM’s in-house law firm

While the federal mandate that large employers must vaccinate employees against COVID-19 was struck down by the United States Supreme Court, employers can still encourage or require employees to vaccinate against COVID-19. This raises the question of compensability for adverse reactions from the COVID-19 vaccine, and related medical treatment and time lost from work. A key factor for workers’ compensation compensability is whether the vaccination was required by the employer.

As with the flu vaccine, the Equal Opportunity Employment Commission and the Occupational Safety and Health Administration have both confirmed that employers can mandate that their workers receive the COVID-19 vaccine as a condition of employment. Those employers that choose to mandate the COVID-19 vaccine will need to accommodate waivers or exemptions for employees objecting on health or religious reasons. Other employers may decide to encourage the vaccine, but not mandate it, by offering on-site vaccinations, payment or reimbursement of vaccine costs, monetary incentives, or as a part of an employer’s wellness program to encourage employees to be vaccinated.

A second key factor for compensability is whether the side effects that occurred from undergoing a COVID-19 vaccination rise to the level of an injury or illness, temporary or permanent. To date, the reported COVID-19 vaccine side effects mirror those that have been seen with the flu vaccine. The most common side effects of the COVID-19 vaccine include swelling or pain at the injection site, tiredness, muscle pain, chills, joint pain and fever. These are usually mild in nature and resolve on their own in a few days. Severe allergic reactions to the COVID-19 vaccination requiring treatment have been reported as rare according to the Centers for Disease Control and Prevention .

What does all this mean in the context of workers’ compensation? Is an adverse vaccine reaction compensable? The answer is that it depends.

To determine whether an adverse reaction is compensable will require an investigation into the facts of each claim, receipt of medical records and consideration of the following:

• Was the vaccine mandated by the employer?
• Was undergoing the vaccine a condition of employment?
• Was there something specific to the employment and/or job duties that put the employee at an increased risk for exposure to COVID-19?
• Does undergoing the vaccine in some way further the business of the employer?
• Is the employee working with COVID-19 positive patients?
• Is the employee required to work with the public?
• Was the vaccine administered at work while the employee was working and being paid?
• Did the employee, for personal reasons outside of their employment, undergo the vaccine?

In states such as Wisconsin, Iowa, Nebraska, South Dakota and Kansas, consideration of the specific circumstances of the vaccination that caused the adverse reaction, as suggested by the questions above, will help to guide the determination of compensability.

For Minnesota claims, there is an additional statutory provision that may need to be considered. MN Stat. 176.011, Subd. 16 specifically states “an injury or disease resulting from a vaccine in response to a declaration by the United States Department of Health and Human Services to ‘address an actual or potential health risk’ related to the employee’s employment is an injury or disease arising out of and in the course of employment.” Thus, in Minnesota where the COVID-19 vaccine reaction rises to the level of an injury or disease, and was related to the employee’s employment, the medical treatment and any lost time from work most likely would be compensable.

If an employer mandates vaccination, or strongly encourages the employee to obtain the vaccine for work-related reasons, the scales will more likely tip in favor of compensability.

The COVID-19 vaccine-related reaction claims may contain varying facts and medical situations. Please contact your attorney before making any employment or workers’ compensation liability determinations.

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

On February 3, 2022 Minnesota Gov. Tim Walz signed a bill into law that reinstated and extended the rebuttable COVID-19 presumption under Minnesota’s occupational disease statute. Minnesota Statutes Section 176.011, subd. 15(f), reinstated what has become known as the COVID-19 presumption law, creating a rebuttable presumption for certain first responders, corrections workers and COVID-19 healthcare workers who contract COVID-19.

The new presumption signed into law on February 3, 2022 is not retroactive, which means any first responders, corrections workers and COVID-19 healthcare workers who contracted COVID-19 after December 31, 2021 (the date the previous presumption sunsetted) through February 3, 2022 were not covered under the presumption. However, they were still potentially covered under other existing occupational disease or injury provisions of Minnesota’s Workers’ Compensation Act.

When not covered by the presumption, workers in Minnesota who believe their COVID-19 infection is a direct result of their employment are able to file a claim to pursue compensation under the existing occupational disease and personal injury provisions.

In summary, the reinstatement and extension of Minnesota’s COVID-19 workers’ compensation presumption law provides:

• A defined list of occupations covered by the presumption of COVID-19 as an occupational disease:  firefighter; paramedic; nurse or health care worker, correctional officer, or security counselor employed by the state or a political subdivision at a corrections, detention, or secure treatment facility; emergency medical technician; a health care provider, nurse, or assistive employee employed in a health care, home care, or long-term care setting, with direct COVID-19 patient care or ancillary work in COVID-19 patient units.
• Those on the list of covered workers can show they contracted COVID-19 by a positive laboratory test or, if a test is not available for the employee, by diagnosis and documentation from a licensed physician, physician’s assistant, or advanced practice registered nurse (APRN);
• The presumption is rebuttable by the employer and insurer only by a showing that the employment was not a direct cause of the disease;
• The date of injury for this presumptive COVID-19 is either the date the employee was unable to work due to the diagnosis, or due to symptoms that were later diagnosed as COVID-19, whichever occurred first;
• If an employee who has contracted COVID-19 does not fall under the new presumption, they still have the right to file a claim under the existing occupational disease and personal injury provisions of the Minnesota Workers’ Compensation Act.

This COVID-19 presumption legislation is effective for employees who contract COVID-19 on or after the day following enactment (April 8, 2020) through December 31, 2021, and once again is effective the day following enactment (February 3, 2022) through January 13, 2023.

For more information on the law, see the Minnesota Department of Labor and Industry’s Frequently Asked Questions document .

This is not intended to serve as legal advice for individual fact-specific legal cases or as a legal basis for your employment practices.

By Peter F. Lindquist, Esq. Defense Counsel with SFM’s in-house law firm

The Minnesota Supreme court issued two companion decisions on October 13, 2021 – Musta v. Mendota Heights Dental Center, and Bierbach v. Digger’s Polaris – addressing a burning question on the minds of many in the Minnesota workers’ compensation world: Can an employer and insurer be required to pay for an injured worker to treat their work-related condition with the use of medical cannabis, even if the use of medical cannabis is prohibited by federal law?

In these cases, the Minnesota Supreme Court answered “No.” Due to issues of “federal preemption,” Minnesota employers and workers’ compensation insurers cannot be compelled to violate the federal Controlled Substances Act by providing for an employee’s use of medical cannabis, even if use of medical cannabis a is legal under the Minnesota Medical Cannabis Therapeutic Research Act.

By way of background, the employees in both Bierbach and Musta had been certified to treat their work-related injuries with medical cannabis by their treating doctors. That treatment was unsuccessfully disputed by the employer and insurer in the Bierbach case, but reasonableness and causal relationship was stipulated to in the Musta case. The primary issue in both cases was the federal preemption defense. The compensation judges in both cases found that the Minnesota Medical Cannabis Therapeutic Research Act was not preempted by the federal Controlled Substances Act.

On appeal, the Workers’ Compensation Court of Appeals determined that they did not have jurisdiction to decide issues relating to the applicability of federal laws and could not decide the federal preemption issues. They therefore upheld the award of medical cannabis in both cases.

The Minnesota Supreme Court noted that the compensation judges’ order made it impossible for the employers and insurers to comply with both state and federal laws. The Court reasoned that ordering the insurers to reimburse for medical cannabis was tantamount to requiring them to aid and abet the commission of a federal crime. Because the Supremacy Clause of the US Constitution states that when “there is any conflict between federal and state law, federal law shall prevail,” the Court ruled that the compensation judge’s order is preempted by the federal law and reversed the appeals court and compensation judge’s award of reimbursement for medical cannabis.

These decisions create a new bright-line rule regarding the compensability of medical cannabis in workers’ compensation claims. Following to these decisions, insurers now have an almost absolute basis to deny a request to reimburse expenses for medical cannabis, as they cannot be required to violate federal law. This applies even if the treatment with medical cannabis is found reasonable and necessary from a medical provider.

The employees in both cases have the right to appeal these decisions to the U.S. Supreme Court, and as of the writing of this article it appears that they are likely to do so. It will be some time before there is any indication as to whether the Supreme Court decides to hear the appeal. Unless the U.S. Supreme Court overturns the Minnesota Supreme Court’s decisions, the only remaining means for the federal preemption defense to be changed or limited would be for U.S. Congress to pass, and the President to sign, legislation modifying the Controlled Substances Act.

Given how divided the federal government and nation have been on the issue of marijuana legalization, I do not think we should expect for there to be any change in this manner for the foreseeable future.

Click here to read the Supreme Court’s decision in Musta v. Mendota Heights Dental Center

Click here to read the Supreme Court’s decision in Bierbach v. Digger’s Polaris.

Iowa Workers’ Compensation Commissioner Joseph Cortese determined that an injury to a muscle in the rotator cuff is considered a shoulder injury for the purpose of determining permanent partial disability benefits.

This is important because shoulder injuries are listed on the state’s workers’ compensation schedule, which provides a formula to calculate permanent partial disability benefits for listed body parts. This makes it much simpler to determine the dollar amount of benefits owed.

This determination was made in the case of Mary Deng vs. Farmland Foods, Inc., and reversed a previous decision of a deputy commissioner.