# Insurance Co. of North America v. Workmen's Compensation Appeal Board

> Commonwealth Court of Pennsylvania · June 11, 1991 · 137 Pa. Commw. 393

URL: https://www.frixlaw.com/law-library/cases/9752974

## Case

- **Full name:** INSURANCE COMPANY OF NORTH AMERICA, Petitioner, v. WORKMEN’S COMPENSATION APPEAL BOARD (KLINE AND PACKARD PRESS), Respondents
- **Court:** Commonwealth Court of Pennsylvania
- **Decided:** June 11, 1991
- **Citations:** 137 Pa. Commw. 393; 586 A.2d 500
- **Precedential status:** Published
- **Opinion:** Dissent by Doyle
- **Judges:** Craig, Doyle, Barry
- **Cited by:** 21 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/9752974

## How later opinions describe it (automated extraction)

- holding that compensation includes medical benefits in the context of Supersedeas Fund reimbursement

## Opinion text

*401 DOYLE, Judge,
dissenting.
I respectfully dissent. Section 306(f)(2)(ii) of The Pennsylvania Workmen’s Compensation Act (Act) Act of June 2, 1915 P.L. 736, as amended, 77 P.S. § 531(2)(ii), provides:
The employer shall have the right to petition the department for review of the necessity or frequency of treatment or reasonableness of fees for services provided by a physician or other duly licensed practitioner of the healing arts. Such a petition shall in no event act as a supersedeas, and during the pendency of any such petition the employer shall pay all medical bills if the physician or other practitioner of the healing arts files a report or reports as required by subparagraph (I) of paragraph (2) of this subsection. (Emphasis added.)
Certainly the language could not be more clear that the filing of the petition itself does not create an automatic supersedeas. We must, however, decide whether it authorizes a discretionary supersedeas because Section 443 of the Act, 77 P.S. § 999, 1 which deals with reimbursement from the Supersedeas Fund (Fund), limits such reimbursement for “payments of compensation” to cases where “a supersedeas has been requested and denied under the provisions of Section 413 or Section 430 of the Act.” If a supersedeas cannot be granted, there can be no recovery from the fund.
Section 413, 77 P.S. §§ 771-774.2, 2 pertains to review/modification or setting aside an agreement for fraud; modification due to a change in disability; amendment of petitions; the effect of a petition to terminate or modify an agreement; the effect of an employer’s improper suspension, decrease or termination of compensation benefits; and the right of an employer to suspend compensation where the employee has returned to work at previous or increased earnings and a petition to terminate or modify has been filed.
*402 Section 430 of the Act, 77 P.S. § 971, pertains to the effect of an appeal on a lien of judgment.
Neither Section 413 nor Section 430, therefore, even remotely concerns a petition challenging the reasonableness of medical expenses. Accord Bureau of Workers’ Compensation v. Workmen’s Compensation Appeal Board (Lukens Steel Co.), 105 Pa.Commonwealth Ct. 421, 524 A.2d 1041 (1987) (holding that the application of Section 443 is strictly limited to procedures under Section 413 and 430 of the Act and, hence is inapplicable to Section 314 of the Act, 77 P.S. § 651, pertaining to an employer’s right of reimbursement after a claimant refuses to comply with a Board order for a physical examination).
Just as in Lukens Steel Co., dealing with Section 314, Section 306(f)(2)(ii) of the Act provides its own remedy by allowing the employer to petition the Department of Labor and Industry for review of the reasonableness of medical expenses without resort to the procedure established under Sections 413 or 430. Nowhere in Section 306(f) is reimbursement from the Supersedeas Fund or anywhere else provided for, specifically because “during the pendency of any such petition the employer shall pay all medical bills if the physician or other practitioner of the healing arts files a report as required by subparagraph I____” Section 306(f)(2)(ii). And, failure to pay such medical expenses is a clear violation of the Act. Glinka v. Workmen’s Compensation Appeal Board (Sears, Roebuck & Co.), 104 Pa.Commonwealth Ct. 175, 521 A.2d 503 , appeal denied, 516 Pa. 644 , 533 A.2d 714 (1987); Johnson v. Workmen’s Compensation Appeal Board (Albert Einstein Medical Center), 137 Pa.Commonwealth Ct. 176, 586 A.2d 991 (1991).
Reimbursement from the Supersedeas Fund is statutorily limited to “compensation” paid out. The word compensation is not specifically defined in the Act and we held in Fuhrman v. Workmen’s Compensation Appeal Board (Clemens Supermarket), 100 Pa.Commonwealth Ct. 577, 515 A.2d 331 (1986), that a determination of what compensation means must be made on a section by section basis. We *403 further held in Fuhrman that “compensation” as that term is used in Section 434 of the Act, 77 P.S. § 1001, (establishing a three-year statute of limitations for setting aside a final receipt) was not applicable to medical expenses under Section 306(f). Moreover, and of critical importance, is that in Fuhrman we specifically rejected the rationale of Chabotar v. S. Klein Department Store, 26 Pa.Commonwealth Ct. 572, 364 A.2d 970 (1976), where we had previously held that the then two-year statute of limitations under Section 413 was incorporated into Section 306(f). In rejecting the notion that the present three-year statute of limitations in Section 413 is applicable to Section 306(f) medical expenses, we stated:
Applying the logic of Chabotar would result in the incorporation of both Section 413 and Section 434 into Section 306(f). We decline to perpetuate this interpretation, because we believe that widespread changes by amendments to the Act in 1972 and 1978 altered the meaning of Section 306(f).
Fuhrman , 100 Pa.Commonwealth Ct. at 584, 515 A.2d at 334 . And, in discussing Section 306(f)(5), we further wrote:
this section ... must presuppose the payment of medical expenses after the expiration of a statute of limitations, and thus separates the concept of ‘medical expenses’ from the concept of ‘compensation. ’
Id., 100 Pa.Commonwealth Ct. at 585, 515 A.2d at 334 (emphasis deleted; emphasis added).
What the majority’s holding would now do by its determination that “compensation” includes “medical expenses,” which under Section 443 can only be accomplished “under the provisions of Section 413 or Section 430,” is to reapply Section 413 to Section 306(f); something we absolutely eschewed in Fuhrman . In the instant case, the “compensation” referred to in Section 443 is that, and only that, which is incorporated under Sections 413 and 430, and, as above outlined, those Sections do not pertain to medical expenses. Accordingly, one is driven to conclude that reimbursement for medical expenses later judicially determined to be unrea *404 sonable or unnecessary cannot be recouped from the Supersedeas Fund. And, because of this conclusion, it follows logically that a discretionary supersedeas for such expenses cannot be obtained under the Act. I note that the majority in ADIA Personnel Agency v. Workmen’s Compensation Appeal Board, 137 Pa.Commonwealth Ct. 405, 586 A.2d 507 (1991), has come to the same conclusion that “no section within the Act authorizes a discretionary supersedeas as to payment of medical expenses” (p. 508).
The “valid reason” sought by the majority here (p. 502) as to why an insurer cannot recover medical expenses from the Supersedeas Fund when work loss benefits can be recovered, succinctly stated, is that the Legislature simply did not so provide and it is not our prerogative to dictate otherwise. Economic and government policy such as that should remain with the Legislature. 3
Because of my disposition of the first issue, it is necessary for me to reach the constitutional question. For the reasons stated in my concurring opinion in ADIA, I do not believe a constitutional violation exists.
. Section 443 was added by Section 3 of the Act of February 8, 1972, P.L. 25 (Act 12).
. Sections 774.1 and 774.2 were added by Sections 3 and 2 respectively of Act 12.
. The brief of the respondent, Commonwealth of Pennsylvania, Department of Labor and Industry, as conservator of the Supersedeas Fund, contains two policy arguments against allowing unreasonable medical costs to be recouped from the Fund; first, it would increase the cost of operating a business in Pennsylvania for all employers, and second, employers, knowing that the Fund would be available to recoup any unreasonable medical costs, would be far less vigilant in contesting medical treatment and costs believed to be either unnecessary or exorbitant.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9752974. Public record. Not legal advice.