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Thread Title: Ogilvie does NOT shut the door on VR experts
Created On Monday February 09, 2009 3:53 PM

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Monday February 09, 2009 3:53 PM

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There is no doubt that the Board intended to elimiate VR counselors as experts in the majority of DFEC cases. Ogilvie, however, does not do that. If you look at the formula the most important piece of information -- an appilcant's ACTUAL post injury earnings -- is almost impossible to determine without a VR expert. Most, injured workers are on temporary disability after their injury or don't go back to work for a whole host of reasons (malingering, fear to return to the workforce, etc.). So, the applicant's ACTUAL post injury earnings probably RARELY track his post injury earning CAPACITY.

As a defense attorney I would normally object to any DFEC analysis that uses an applicant's actual post injury earnings because that figure is likely to be substantially less than the applicants earning capacity (and therefore overstate the FEC modifier and final WPI). But then I am stuck. Once I object, that opens the door for the applicant to go ahead and hire a DFEC expert which I then must pay for. And, given the Costa II decision, which essentially allows for reimbursement of a VR expert in most situations, my client will be on the hook for the DFEC costs.


A recent en banc decision from the Workers' Compensation Appeals Board appears to have slammed the door on the use of vocational rehabilitation experts in favor of a formula-based method of rebutting the diminished future earning capacity portion of the 2005 permanent disability rating schedule, which some have criticized as statistically problematic.

The Workers' Compensation Appeals Board's decision in Ogilvie v. City and County of San Francisco recommended that attorneys use a formulaic approach to determine whether an injured worker's whole person impairment rating is or is not representative of their ability to compete in the labor market.

When this impairment rating under-represents a worker's ability to re-enter the market, the 2005 permanent disability rating schedule suggests a system of multipliers. These multipliers can increase an injured worker's rating substantially in some cases, while in other cases they may only provide for a small increase.

The primary dispute in the Ogilvie decision was to determine how to decide when the 2005 schedule's suggested multipliers are insufficient, and what to do afterward. This is also known as rebutting the diminished future earning capacity (DFEC) portion of the 2005 permanent disability rating schedule.

In its decision, the board offers a formulaic method that attorneys can use to prove that the schedule's multipliers are insufficient. In the majority of cases, the WCAB specifically stated that its formula should replace the expert testimony of vocational rehabilitation experts.

Defense attorney Saul Allweiss said, "Ogilvie probably has put the final nail in the coffin on the use of vocational experts, because it looks like voc experts aren't going to be what the injured worker or the employer is going to need to be able to rebut the DFEC component."

Numerous stakeholders made similar comments to WorkCompCentral, and added that they weren't necessarily surprised by the development.

The board reasoned that this would decrease the amount of costs in the average workers' compensation case, a concept that defense attorney Richard "Jake" Jacobsmeyer agreed with.

"I actually interpret Ogilvie as being a defense judgment," he said. "You may be able to rebut the schedule, and the question is how you do it. ... The fact that the board said that you don't need to spend a whole bunch of money on a vocational counselor to do it, it's huge, because they're spending $7,000, $8,000, $9,000 on these guys to show up on cases that were worth $5,000. I just settled a case last month for $24,000, and the vocational expert fees that we paid for the two combined were somewhere in the range of $11,000."

The board acknowledged that in some cases, it still may be necessary to hire a vocational rehabilitation counselor to determine two factors that play a significant role in the WCAB's formula – the three years of post-injury earnings for the injured worker, and the three years of average earnings for similarly situated employees. Commissioner Ronnie Caplane, the sole dissenter against the majority in Ogilvie, also pointed this out.

William Herreras, an attorney for the California Applicants' Attorneys Association, said that the formula's reliance upon these particular statistics can prove to be problematic.

"Most workers at the time their permanent disability rating is being assessed, are not back to work," he said. In this scenario, Herreras posed the question: "How do you project what their post-injury earnings are without a rehab expert – to look at their work restrictions, to look at what they can do in the labor market, to look at what their activities of daily living are – and then project what this guy could earn in the labor market?"

While Herreras understands that the board is attempting to reduce costs in the workers' compensation system by eliminating vocational rehabilitation experts from the majority of cases, he does not necessarily believe that this is feasible.

Herreras stressed that many workers have trouble returning to work, and it may be difficult to obtain an accurate representation of a worker's earnings during the three-year period after their injury. One problem that prevents workers from returning to the labor market after a significant injury, is that they simply do not know what to do after spending the majority of their career in one field, he said.

Mark Remas, a Southern California vocational rehabilitation counselor, added that while some workers are confused, many others are often undergoing significant treatment for a year or two after their injury, which also can affect their three-year post-injury earnings. Inflation and age also pose other complications for injured workers who are unable to work in their industry of choice.

Remas also acknowledged language in the WCAB's opinion criticizing vocational rehabilitation counselors' reports as being too long and complex.

Page 38 of the WCAB's opinion states: "While it may be relatively easy to hire a vocational expert, our experience informs us that the DFEC analyses performed by vocational experts are quite involved and complex. This is readily evidenced by the vocational expert reports in this case."

The WCAB pointed out that Dr. Eugene Van de Bittner, one of the counselors in Ogilvie, submitted a 21-page single-spaced report, with about 27 other pages to supplement the report. The commissioners also noted that Jeff Malmuth, the other vocational counselor in the case, submitted a 24-page single-spaced report, with 18 pages to supplement his report.

However, Remas appeared frustrated by this criticism.

"Well, when we started out with these, we would have a fairly short report," he said. "That was challenged because we didn't have all this documentary support, methodology, et cetera, so the reports became longer and longer and more costly. Because you have to put that much more time into the report, the price goes up. So, now that we've finally got to the point of answering all of those objections and queries and concerns, now the court just says, 'Nah, it's too complex. Let's go to something simpler.'"

He added that much of his time as a vocational expert has been answering questions establishing his knowledge of the permanent disability rating schedule, the Rand studies, and many other ancillary issues pertaining to his educational background. This is also somewhat frustrating, because only after all of these questions does the expert get to do what they were hired to do – offer their opinion about the injured worker's job prospects.

To read the Ogilvie decision, go here:

By John P. Kamin, Legal Editor



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