PA Commonwealth Court Answers Some IRE Questions, But Not Others

Back in 2017, we shared the exciting news (hey, we attorneys have a unique sense of excitement!) that the entire Impairment Rating Evaluation (IRE) section of the Pennsylvania Workers’ Compensation Act (Act) was declared unconstitutional by the Supreme Court of PA (The Protz case) and stricken from the Act.  This, of course, stopped attempts by the insurance industry to get an IRE at all.

Not able to live with themselves in a world without IREs (oh, the horror), the Pennsylvania legislature passed Act 111.  This brought back the IRE process, albeit with a specific identification of which version of the Guides to the Evaluation of Permanent Impairment, put forth by the American Medical Association, need be used (the failure to so identify was largely the reason the prior IRE law was stricken).  Act 111 also lowered the threshold for continued total disability from 50% to 35% whole body impairment (for a better explanation of the IRE process, see our website).

Recently, the Commonwealth Court of PA addressed to what extent Act 111, which was enacted on   October 24, 2018, would be retroactive.  The case of Rose Corporation v. Workers’ Compensation Appeal Board (Espada) involved a work injury of September 6, 2006.  On May 22, 2013, the insurance carrier had obtained an IRE under the old (stricken) IRE law.  The IRE used the correct edition of the AMA Guides, and found a whole body impairment rating of less than 35%.  As a result, the insurance carrier wanted to use the 2013 IRE to obtain a change of benefit status, from total to partial, under Act 111.

After analyzing Act 111, and concluding that such legislation was “substantive,” rather than “procedural,” the PA Commonwealth Court denied the insurance company’s attempt.   Act 111 actually changes the benefits an injured worker can receive, by placing a time limit on the receipt of benefits, which makes it “substantive.”  There was no effort by the legislature, in Act 111, that the entire Act be retroactive (there is mention that weeks of credit under the old IRE law would be preserved, but that is as far as the legislature went on retroactivity).  As such, Act 111 should only be applied prospectively.

However, then the Court went on to say that the insurance carrier could obtain a new IRE under Act 111.  To this, we must say, enthusiastically, “Huh?”  If Act 111 is substantive, then it cannot be applied retroactively without being unconstitutional.  If the date of injury predates the effective date of a piece of legislation, such as here, then it would appear to be unconstitutional for Act 111 to apply to that case at all.  This point was not addressed by the Court, though it is our understanding that the issue is currently working its way through the Pennsylvania appellate system.