Illinois employer's payment of medical expenses warrants penalties, fees
If an employer issues a check to a claimant pursuant to a medical expense award and includes the medical provider as a payee on such check, the employer may be sugjecto to penalties and attorney's fees. The emploeyr has not right to interfere with the claimant's determination of how he distributes the proceeds of his award.
Case name: Carreno v. Cambridge Homes, 17ILWCLB 210 (Ill.W.C..Comm. 2009).
In a previous decision, the Illinois Workers' Compensation Commisison awarded Carreno 165 weeks of temporary total disability, $113,780 in medical expenses, and permanent partial disability for 250 weeks at $186 per week. After appeals to the Circuit court, appellate court and Supreme Court, the employer issued 18 checks. Two checks were made payable to Carreno and his attorney, representing TTD, PPD and interest, and 16 checks were made payable to Carreno, his attorney and corresponding medical providers.
Carreno filed a petition for penalties and attorney's fees, contending that the employer improperly tendered the medical expense award by making Carreno's medical providers payees on the checks. In a decision summarized at 14ILWCLB 98, the Commission agreed and granted the petition, finding the employer's inclusion of medical providers as payees on the checks representing the medical expense award was unreasonable and vexatious. However, the Circuit Court remanded for a more detailed explanation regarding why the employer's inclusion of the names of medical providers on Carreno's checks was vexatious. The court also ordered the Commission to calculate the interest on Carreno's unpaid award, which the court determined to be $113,779.85.
On remand the Illinois Workers' Compensation Commission explained that the employer's actions were unsupported by the law. The employer cited no law to support the conclusion that its conduct was reasonable, and the Commission was unaware of any law that would provide a reasonable basis for including the names of Carreno's medical providers on checks issued in payment of the award. Furthermore, the employer presented nothing to show that they could have met the standard of objective reasonableness required by the court in Board of Education v. Industrial Commission in a belief that it was proper to include the medical providers on checks issued to Carreno. The Illinois Workers' Comensation Commission therefore, found the employer acted contrary to WCA Section 21 and Mentzer v. Van Scvoc. The employer presented nothing that would lead to the conclusion that it reasonably believed its method of tender was proper under the law.
The Illinois Workers' Compensation Commission concluded that the employer acted unreasonably and vexatiously when it included Carreno's various medical providers as joint payees ont Carreno's checks. Carreno was therefore entitled to addtional compensation pursuant to Section 19(k) in the amount of $56,889.93, representing 50% of the amount wrongfully withheld. Carreno was further entitled to attorney's fees pursuant to Section 16 in the amount of $34,133.96, representing 205 of the amount wrongfully withheld and the amount of additonal compensation awarded herin pursuant to Section 19(K).
