Litigating Modern Psyche Claims Post 1/1/13

by Julie Insisoulath (December 7, 2018)

While we all may have a general understanding of workers’ compensation claims alleging physical injury, some of us are not completely comfortable handling psyche claims. A psyche claim is an injury to the mind, and thus, it is more difficult to assess than most physical injuries. There are specific requirements to bring psyche claims, exceptions to those requirements, as well as multiple defenses to litigate. This article focuses on the recent changes in the law and its ramifications on litigation involving, arguably, valid psyche claims. The potential exposure of liability is often dependent on the date of injury, whether it is before or after January 1, 2013, because the date of injury will determine whether impairment will be awarded, though of course, it is subject to some exceptions.

Changes in the Law Post 1/1/13

For dates of injury before January 1, 2013, applicants are able to obtain an increase of impairment ratings for psyche claims as a result of a compensable consequence from a physical injury. However, Labor Code Section 4660.1(c)(1) was amended to exclude any additional impairment for compensable psyche claims for dates of injury after January 1, 2013, subject to exceptions. The Legislature did so with the intentions of “eliminating questionable claims of disability.” This seems to have increasingly alleviated the burden placed on carriers to pay out increased settlement amounts for add on psyche claims. There has since been a downward trend for psyche claims, which make them even more difficult to navigate given the adjuster’s limited experience to such.

Standard of Evidence

For modern psyche injuries, Labor Code Section 3208.3(b)(1) requires that an employee demonstrate by preponderance of evidence that actual events of employment were predominant as to all causes. This translates to mean that the employment has to cause more than 50% of the alleged psyche injury. This can be proven in a variety of ways. There is no hard and fast rule that a Qualified Medical Evaluator is always required in psyche claims. However, due to the dubious nature of the claim, it is a good practice to obtain one. The evidentiary standard decreases to a “substantial cause” standard for violent act situations.

Discovery Tactics

When an applicant alleges a psyche claim, the defense is given nearly “carte blanche” for discovery purposes to defend the claim. The types of questions to ask in a deposition and the extent of records to subpoena are not limitless, but do dramatically increase the scope of discovery. Thus, the allegations of a psyche claim can act as a double edge sword. While the applicant may hope to obtain a greater settlement in the end, it will likely be at his/her emotional expense. The applicant’s childhood, relationships, past history of abuse, social media, mental history, drug use, drinking habits, etc. may all be subject to discovery and investigation for AOE/COE and apportionment. These aspects of applicant’s life are all relevant for purposes of determining whether the psyche injury meets the evidentiary threshold and the extent of the alleged disability.

Discovery is often uncomfortable and difficult for the applicant. This often causes depositions to end abruptly due to the sensitive nature of the topics being discussed. If the applicant refuses to continue, a defense attorney may want to consider moving to compel the applicant’s testimony, which can put pressure on the applicant to settle early. During or shortly following applicant’s deposition is probably the best opportunity to settle a psyche claim.

It is very important for a defense attorney to maximize discovery, whether by taking the deposition of the applicant, employer, and/or co-workers, or looking into the applicant’s employment and medical records to mount an aggressive defense.

Direct Injury (Stand-Alone) Psyche Claims v. Compensable Consequence Psyche Claims

Even after January 1, 2013, it is possible for an applicant to obtain impairment in a direct injury, or stand-alone, psych claim. A direct injury, or stand-alone psych claim is an injury which occurs commonly in unlawful, discriminatory harassment situations.

If the applicant suffers a physical bodily injury and adds psyche as a compensable consequence, the applicant is not entitled to any increases in impairment for the psyche claim. There are a few limited exceptions to this rule. If the applicant can show that he/she is victim of a violent act, or had direct exposure to a significant violent act, or suffered a catastrophic injury, such as the loss of limb, paralysis, severe burns or head injuries, then the applicant may be entitled to the additional impairment. (Labor Code Section 4660.1(c)(2)(a)-(b)).

The appeals board has held that despite the fact that there is no additional impairment for compensable consequence claims, the applicant is still allowed temporary disability and medical treatment. If the applicant has never treated for his/her psyche claims, and/or testifies that he/she does not intend to obtain treatment for psyche, this may greatly minimize the employer’s exposure.

Conclusion

It is essential to recognize the date of injury of the psyche claim and the type of psyche claim being alleged to determine compensability. Generally speaking, for direct psyche claims (post 1/1/13), the applicant is entitled to impairment, whereas in compensable consequence psyche claims, the applicant will not be entitled to the additional impairment. For compensable consequence psyche claims, the costs for any temporary disability and future medical psychiatric care should be considered when evaluating potential overall exposure for the purposes of settlement. However, the concept of paying temporary disability for a psyche injury can be frustrating because the opposing sides will differ as to an applicant’s entitlement to such benefits, especially when the applicant was, or has been, physically able to work. Therefore, it will take much negotiation on both sides to settle a psyche claim, which likely will take a considerable amount of time to move the claim towards closure.

I hope this article has provided a general framework in understanding psyche claims, however, please keep in mind there are many nuances in the law that control psyche claims.

For more information regarding psyche claims, see also “The 6-Month Rule” BLOG article dated November 16, 2017 by Farai M. Alves.

Julie Insisoulath is a workers’ compensation defense attorney at Bradford & Barthel’s Oakland location. In addition to workers’ compensation, her background includes civil litigation and direct legal services work for the public. Ms. Insisoulath can be reached at jinsisoulath@bradfordbarthel.com or (510) 268-0061.

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