Asheville Mission Hospital Workers' Compensation Sanctions Deemed 'Unusual'!


Mission Hospital Logo Asheville Mission Hospital Withheld Evidence, Committed Fraud, State Says!

Mark Barrett
Citizen-Times.com
October 31, 2009

ASHEVILLE - Mission Hospital failed to turn over key evidence in Workers' Compensation cases, gave employees blatantly incorrect information about the law and repeatedly denied benefits without basis, state officials found.

The N.C. Industrial Commission, its deputy commissioners and appellate courts have taken the unusual step of directing Mission to pay employees' attorney fees as a penalty for the way in which it handled at least six disputes over injuries to its workers this decade.

Sandra King, a local attorney who represents employers in Workers' Compensation cases, said it is possible that Mission "has been sanctioned more than any other employer in the state in the past five years."

"This is not usual (for employers) and there's no reason that it ought to be going on," King said. She said the cases reflect "a long-term situation that needs cleaning up."

Mission's conduct came to light following a Sept. 22 ruling by Deputy Commissioner George Glenn II in which Glenn referred Mission's handling of a case to the state Department of Insurance and the state attorney general's office.

He ordered that Mission pay the attorney fees of its former employee, Terry Cawthorn, as well as an additional penalty of 10 percent of the benefits due her because of Mission's "bad faith denial and fraudulent actions."

A spokeswoman for Attorney General Roy Cooper said attorneys at the Department of Justice and Department of Insurance have been discussing how to handle what she called "an unusual case."

Mission said earlier this week that it had not been contacted by either agency. It is appealing Glenn's decision in the Cawthorn case.

In a written response to questions from the Citizen-Times, Mission did not directly contradict allegations that it has deliberately sought to deny valid claims. It has said it welcomes any investigation by the state.

Repeated Problems
State Workers' Compensation laws provide that employees are entitled to costs of their medical treatment and two-thirds of their lost wages while out of work because of job-related injuries. Workers cannot collect damages for pain and suffering or punitive damages, but the system is supposed to resolve their cases quickly in return.

Cases in which employees challenge their employers' denial of Workers' Compensation benefits generally go first to informal mediation under the direction of the Industrial Commission, a state agency.

Either party can then seek a hearing before one of the commission's deputy commissioners, whose status is comparable to that of an administrative law judge. Appeals from those rulings are heard by panels made up of three members of the Industrial Commission.

From there, either party can appeal to the state Court of Appeals. Cases occasionally go on from there to the state Supreme Court.

A review of decisions in disputed cases suggests that Mission does not always play by the rules when handling cases in which it and the injured employee do not agree. For example:

  • In the Cawthorn case, Glenn found that a Mission employee knowingly made a false statement to Cawthorn as part of an effort to mislead her and deny her benefits. He also wrote that Mission's decision to deny Cawthorn continued benefits came "in spite of the overwhelming evidence to the contrary."
  • In a different case, a deputy commissioner found that a Mission official would not authorize payment for medicines prescribed by a physician to combat depression despite knowing the injured employee was entering the psychiatric ward.
  • In a 2002 ruling in another case, a deputy commissioner found that Mission ignored the "unequivocal" findings of its own expert when it denied continued benefits to a medical records clerk who was injured by mechanized shelving that closed on her in a records room.
  • The clerk said she thought she would be killed by the shelves. Mission's contention that the experience did not cause subsequent psychological problems was based on "no competent medical evidence," the ruling says.
  • The commission found in 2005 that Mission had withheld videotaped evidence that showed an employee crying after unsuccessfully attempting to return to work.
How Unusual?
Mission, which has about 6,000 employees, said in its statement that employees filed 4,406 "occurrence" reports of incidents in which injuries could have occurred between April 2005 and Oct. 15 of this year.

The statement says that among those incidents, it found 1,094 instances when an employee was injured on the job and that "only 26 claims or 2.3 percent were determined not to be compensable" under Workers' Compensation rules.

Mission said it has become more common for a deputy commissioner or the Industrial Commissioner to award attorney fees to the losing party in general and that "the awarding of attorney fees does not necessarily suggest an employer has acted in bad faith."

David Gantt, a local attorney who has won attorney fees from Mission, said the fees are assessed "not when someone has fought a case but (when) they've fought them unfairly." Gantt is also chairman of the Buncombe County Board of Commissioners.

State law says that attorney fees can be assessed if there is a finding that a case "has been brought, prosecuted, or defended without reasonable ground."

Mission pointed out that officials have sometimes disagreed over whether fees were warranted in its cases. It says that overall it has won eight cases before the commission since 1995 and lost eight.

The Industrial Commission does not keep statistics on how often attorney fees are awarded. Some attorneys who practice Workers' Compensation law in the state said losing parties do have to pay attorney fees more often than in the past, but that it is still rare.

"It is very unusual. It's not unheard of, but you don't see them very often," said Leonard Jernigan, a Raleigh attorney who represents plaintiffs in Workers' Compensation cases and has written a book on Workers' Compensation law in the state.

Jernigan said he regularly reads appellate cases in the field, and he noted, "I see Mission involved in some litigation over the years that shows a disturbing pattern."

"It's time someone looked into it. I'm glad a deputy commissioner at least brought it to someone's attention," he said, referring to the Cawthorn case.

Nick Valaoras, a Charlotte attorney who has represented employers in Workers' Compensation for 18 years, called assessing the fees "a rare occurrence."

"I probably could count on one hand" the number of his clients who have been so sanctioned, he said.

Referral of a case to the state attorney general is rarer still, he said. "That seems to me to be a very serious next step."

Thomas Ramer, an Asheville-based attorney who represents Terry Cawthorn, said the statistics Mission offers in its defense do not explain or excuse its conduct.

"How many cases don't we know about?" he asked. "How many people never file a claim because they were told by Mission they couldn't?"

The statistics also do not explain the hospital's conduct in cases in which it was sanctioned, Ramer said.

"They've had ample opportunity after each one of these cases to improve their claims handling process for their employees and they haven't done that," he said.

Below are brief descriptions of the cases that focus on the conduct that deputy commissioners at the N.C. Industrial Commission, the full Industrial Commission or appellate judges raised concerns about:

The Actual Cases!
Jennifer Rosenfelt
Injury: Knee, in October 1997, which led to chronic pain and depression.

Conduct criticized: A Mission official, Mary Silver, denied authorization for payment for drugs "based upon her own opinion as to whether plaintiff should take such medications as opposed to any opinion rendered by a physician," wrote Doug Berger, a deputy commissioner for the Industrial Commission.

Silver also denied that she spoke to a physician in the case despite "numerous references" in the physician's notes to conversations with her, Berger wrote. He wrote that Silver's denial is "not credible."

Berger ordered in October 2002 that Mission's attorney give a copy of the decision to the hospital's president and provide verification that the president had seen it.

Through a Mission spokesman, Silver declined comment Friday.

Jeanne Chellis
Injury: Neck, which caused related back and arm problems, in February 1999.

Conduct: Videotape taken by private investigators contracted by Mission showed Chellis "walking, shopping, loading groceries, driving, ordering and receiving food at drive-thru windows, and getting in and out of her car without apparent difficulty," Deputy Commissioner Adrian Phillips wrote in April 2004.

Phillips denied Chellis' claim for further compensation, saying she is not permanently and totally disabled.

The full Industrial Commission, however, overturned Phillips' ruling on a 2-1 vote in January 2005 and ordered Mission to pay Chellis further benefits and her attorney fees and a $5,000 fine payable to the commission.

The turning point was apparently the commission's finding that Mission had withheld videotape taken of Chellis in November 2002 immediately after she attempted to return to work.

The surveillance video showed Chellis "guarding her left arm" and avoiding use of it, "crying in her vehicle," and stretching her neck.

The commission said it gave greater weight to the testimony of physicians who had treated Chellis extensively and had seen the November 2002 videotape.

Sharon Stevens
Injury: Motorized mechanical shelves closed in on Stevens, a medical records clerk, in December 2000, and she later testified she feared she would be crushed to death.

She was treated for muscle and joint injuries and was later diagnosed as having post-traumatic stress disorder.

Conduct: Mission denied a claim based on Stevens' psychological problems despite the findings of a psychologist and two psychiatrists, one of whom was employed by Mission for an independent examination.

"There is no competent medical evidence to support" Mission's contention that the December 2000 incident did not cause Stevens' psychological problems, Deputy Commissioner Bradley Houser wrote in June 2002.

Donna Bradley
Injury: An agitated patient in the emergency room struck Bradley at least three times around her face, back of the neck and head and shoulders when Bradley, a nurse, attempted to give him an IV in January 2001, knocking her to the floor.

This resulted in back problems.

Conduct: Mission refused to mail Bradley's benefit checks to her, requiring her to come to the hospital in person to pick them up, which Deputy Commissioner Ronnie Rowell wrote is against state law and Industrial Commission rules.

Her attorney eventually got an order from a commission official forcing Mission to mail the checks.

After an initial period, Mission declined to pay Bradley's health care costs, but Rowell wrote that Mission "has offered no evidence to support their continued refusal to accept this claim."

The Industrial Commission reversed part of Rowell's order regarding attorney fees.

In a December 2006 opinion, the state Court of Appeals ordered Mission to pay some fees.

Mission said in a statement this week that employees do not currently have to pick up their benefit checks in person.

Jane Doe*"
Injury: The commission found that someone assaulted Doe at the hospital in April 2001, grabbing her breasts, then her buttocks and groin.

A co-worker saw the aftermath of the attack, and a physician and co-workers later observed bruises.

The attack resulted in psychological problems.

Conduct: Mission did not properly investigate the case, the full commission wrote, and offered only one exhibit, Doe's job evaluation, during a three-day hearing.

Mission "possessed documents that confirmed plaintiff accounts of the attack, which they refused to make available to the plaintiff" until compelled to do so, the commission wrote in May 2004.

The state Supreme Court reversed an award of attorney fees to Doe.

The commission and the state Court of Appeals later directed Mission to pay fees to Doe associated with defending Mission's appeal of benefits to Doe.

*The Citizen-Times does not identify victims of sexual assault.

Inez Hill
Injury: Hill slipped on the wet floor of the kitchen in the Mission cafeteria in July 2001, hitting her head and back and resulting in long-term back pain.

Conduct: Mission contended that the fall was due to a seizure, but Deputy Commissioner Kim Ledford wrote that the hospital "had no medical support" for the allegation.

Mission "effectively ignored and denied (Hill's claim) without sufficient basis, until approximately 11 days prior to the hearing," Ledford wrote in July 2004.

Mission also "misled this Court" about whether it was paying certain benefits, and its attorney at one point argued that it could not pay disability compensation because Hill was seeking attorney fees in the case.

Ledford noted in a special commentary that Mission "has been subject to sanctions by three other Deputy Commissioners, based upon unfounded litigiousness. Although not 'evidence' in this matter, the Defendant's prior behavior shows (a) pattern and practice of unreasonable defense of these claims and poor responses and conduct regarding injured employees."

Ledford directed that a copy of her ruling be sent to Mission's vice president for human resources.

Terry Cawthorn
Injury: Back pain, which began when helping a heavy patient into his bed, and related problems, February 2008.

Conduct: Mission initially paid benefits but denied them in June 2008.

A hospital employee wrote Cawthorn her claim was being denied because there was no "accident."

Deputy Commissioner George Glenn II found Sept. 22 that Mission said it was unaware of subsequent incidents in which Cawthorn reinjured her back at work even though the incidents were documented in its records.

Mission's decision to end benefits was "in spite of the overwhelming evidence to the contrary" and statements made to Cawthorn by a hospital employee "constitute fraud," Glenn wrote.

 


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