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MOA v. A. Leigh (1/3/92), 823 P 2d 1241
<![CDATA[
NOTICE: This opinion is subject to
formal correction before publication in the
Pacific Reporter. Readers are requested to
bring typographical or other formal errors to
the attention of the Clerk of the Appellate
Courts, 303 K Street, Anchorage, Alaska
99501, in order that corrections may be made
prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
MUNICIPALITY OF ANCHORAGE, )
) Supreme Court No. S-4076
Petitioner, )
)
v. ) Superior Court No.
) 3AN-89-9484 Civil
ALAN LEIGH, )
) O P I N I O N
Respondent. )
______________________________) [No. 3793 - January 3, 1992]
Petition for Review from the Superior
Court of the State of Alaska, Third Judicial
District, Anchorage, Victor D. Carlson,
Judge.
Appearances: Randall J. Weddle,
Faulkner, Banfield, Doogan & Holmes,
Anchorage, for Petitioner. Chancy Croft,
Debra Fitzgerald, Michael J. Jensen,
Anchorage, for Respondent.
Before: Rabinowitz, Chief Justice,
Burke, Matthews, Compton, and Moore,
Justices.
RABINOWITZ, Chief Justice.
INTRODUCTION
Alan Leigh's temporary total disability benefits were
terminated pursuant to AS 23.30.185 and the definition of
"medical stability"in Alaska's Workers' Compensation Act. On
appeal, the superior court held that the Act's definition
violated substantive due process. Subsequently, we granted a
Petition for Review filed by Leigh's employer, the Municipality
of Anchorage.
FACTS AND PROCEEDINGS
The facts are not in dispute. Alan Leigh is a
paramedic with the Anchorage Fire Department. He injured his
back on October 28, 1988. His employer accepted his claim and
paid him temporary total disability ("TTD") compensation until
January 25, 1989.3
Prior to termination of his benefits, the insurance
adjuster wrote to Dr. Thomas Vasileff, Leigh's treating
physician, asking if Leigh was "medically stable"as defined by
AS 23.30.265(21).4 Dr. Vasileff responded by letter on January
25, 1989, stating "[a]ccording to the definition of medical
stability posed in your letter, [the employee] falls into your
parameters of being medically stable." At a later deposition,
Dr. Vasileff testified that he would prefer to use a definition
of "medical stability" taken from the AMA Guides to the
Evaluation of Permanent Impairment ("Guide").5 Under that
definition, he thought Leigh would not be stable for a period of
six months to a year. He testified that Leigh's condition could
reasonably be expected to improve over time, although he did not
anticipate objectively measurable improvement.
Leigh applied for TTD compensation. The Board,
applying the statutory definition of medical stability, decided
on October 10, 1989 that Leigh was medically stable as of January
25, 1989 and denied his claim. It stated,
The question is what "clear and
convincing evidence" must be adduced [to
overcome the presumption of medical
stability]. We do not believe the
presumption may be rebutted by redefining the
phrase "medical stability." We believe that
AS 23.30.265(21) demands evidence that
further objectively measurable improvement
resulting from additional medical care or
treatment may be reasonably expected despite
the 45-day absence of objectively measurable
improvement which triggered the presumption.
Leigh appealed to the superior court, arguing that the
legislature violated substantive due process by changing the
definition of medical stability from the AMA definition to its
own definition.6 The superior court, agreeing with Leigh,
reasoned as follows:
The legislation provides for a
presumption of stability if no "objectively
measurable improvement"has been made for 45
days. The legislation does not address the
situation of no "objectively measurable
improvement"for 45 days but deterioration in
that time. It appears inconsistent for the
injured worker to be removed from temporary
total disability compensation when he has
not only failed to improve but suffers
deterioration. It also appears incongruous
for medical concepts to be used in
determining worker's compensation except for
the termination of temporary total
disability, e.g. AS 23.30.095 and 190. In
addition, it is incongruous for the burden to
be shifted to the injured worker by the
presumption in AS 23.30.265(21) and to
require that the worker prove by clear and
convincing evidence the non-existence of
"medical stability" in light of the
presumption of compensability contained in AS
23.30.120.
The conflicting provisions of AS
23.30 set forth above and the objective
purpose of the act as stated by the
legislature make it clear that the definition
of "medical stability" has no reasonable
relationship to the purpose of the Workers'
Compensation Act and that the challenged
definition rests upon no rational policy.
The Municipality thereafter filed a Petition for Review, which
was granted.7
The Municipality contends that AS 23.30.265(21) does
not violate substantive due process. It argues that the
legislature's definition is rational, is consistent with the AMA
definition, does not conflict with the presumption of
compensability, and that it is constitutional to declare a
deteriorating employee medically stable. The Municipality also
notes that the superior court's decision was essentially advisory
in nature and based upon hypothetical facts.
Leigh argues that the definition of "medical stability"
found in AS 23.30.265(21) is unconstitutional both on substantive
due process and equal protection grounds. He argues that the
definition is irrational because the remainder of the Act makes
use of the AMA guidelines, it has no legitimate basis, it
conflicts with the statutory presumption of continuing
compensability, it inappropriately requires the employee to
overcome the presumption of medical stability by a clear and
convincing standard of proof, and it fails to distinguish between
an injured worker who is improving and one who is worsening.
Leigh also argues that apart from unconstitutionality, the court
should declare the definition invalid as it creates "incongruous"
results in light of the other provisions of the Act. Finally, he
argues that the Board erred as a matter of fact in determining
that Leigh did not furnish clear and convincing evidence that he
was not medically stable, and that the Municipality is estopped
from asserting that Leigh's argument is "hypothetical."
DISCUSSION
There is no question that the legislature radically
changed the workers' compensation statute. Prior to the 1988
amendments, the Act did not define temporary total disability.
Yet, this court had consistently correlated entitlement to TTD
benefits with loss of earning capacity.8 Effective July 1, 1988,
the legislature amended the Act so that TTD terminates after the
date of medical stability. See AS 23.30.185.9
Our analysis of Leigh's contentions starts with the
presumption that the statute is constitutional. 2A Sutherland
Stat. Const. 45.11 (4th Ed. 1984 Rev.). Moreover, "a court is
not empowered to substitute its judgment for that of the
legislature on matters of policy, nor to strike down a statute
which is not manifestly unconstitutional even though the court
may consider it unwise." 1 Sutherland Stat. Const. 2.01 at 15-
16 (4th Ed. 1985 Rev.). Rather, the specific question raised by
this petition is whether the statute's definition of medical
stability, its burden of proof, and its presumption of medical
stability are constitutional.
A. Substantive Due Process and the Statutory
Definition of Medical Stability
In Concerned Citizens of South Kenai Peninsula v. Kenai
Peninsula Borough, 527 P.2d 447, 452 (Alaska 1974) we said:
Substantive due process is denied
when a legislative enactment has no
reasonable relationship to a legitimate
governmental purpose. It is not a court's
role to decide whether a particular statute
or ordinance is a wise one; the choice
between competing notions of public policy is
to be made by elected representatives of the
people. The constitutional guarantee of
substantive due process assures only that a
legislative body's decision is not arbitrary
but instead based upon some rational policy.
A court's inquiry into
arbitrariness begins with the presumption
that the action of the legislature is proper.
The party claiming a denial of substantive
due process has the burden of demonstrating
that no rational basis for the challenged
legislation exists. This burden is a heavy
one, for if any conceivable legitimate public
policy for the enactment is apparent on its
face or is offered by those defending the
enactment, the opponents of the measure must
disprove the factual basis for such a
justification.
The legislature's intent in enacting AS 23.30.265(21)
is clear. Section 1 of the 1988 amendments to the Act provides:
(a) It is the intent of the legislature
that AS 23.30 be interpreted so as to ensure
the quick, efficient, fair, and predictable
delivery of indemnity and medical benefits to
injured workers at a reasonable cost to the
employers who are subject to the provisions
of AS 23.30.10
Ch. 79, 1, SLA 1988 (emphasis added). As noted above the
legislature defined medical stability as follows:
"medical stability"means the date after
which further objectively measurable
improvement from the effects of the
compensable injury is not reasonably expected
to result from additional medical care or
treatment, notwithstanding the possible need
for additional medical care or the
possibility of improvement or deterioration
resulting from the passage of time;
AS 23.30.265(21).
In our view this definition is rational. First, and
most significantly, in its quest to lower costs and facilitate
resolution of disputes, the legislature adopted a clear
definition as to when medical stability is achieved for purposes
of the Act. The AMA Guides to the Evaluation of Permanent
Impairment contains no clear definition of medical stability.
The definition Dr. Vasileff used from the AMA Guide, equating
medical stability with the absence of "medical reason to expect .
. . gain or [loss of] future functional ability,"comes from the
Guide's preface.11
Even assuming the Guide contains a definition of
medical stability inconsistent with the statute, the legislature
chose not to adopt it. The legislature appears to have
explicitly rejected TTD benefits for a worker whose condition
deteriorates. The statute states that
"medical stability"means the date after
which further objectively measurable
improvement form the effects of the
compensable injury is not reasonably expected
to result from additional medical care or
treatment, notwithstanding the possible need
for additional medical care or the
possibility of improvement or deterioration
resulting from the passage of time . . . .12
AS 23.30.265(21).
In addition to this conflict with AMA guidelines, Leigh
contends that the principal problem with AS 23.30.265(21) is that
its definition of medical stability fails to take account of a
claimant with a worsening condition. In response to this
contention the superior court said:
The legislation provides for a
presumption of stability if no "objectively
measurable improvement"has been made for 45
days. The legislation does not address the
situation of no "objectively measurable
improvement"for 45 days but deterioration in
that time. It appears inconsistent for the
injured worker to be removed from temporary
total disability compensation when he has not
only failed to improve but suffers
deterioration.
The Municipality, citing Lien v. City of Ketchikan, 383
P.2d 721, 724-25 (Alaska 1963), argues that a deteriorating
claimant is a hypothetical concern which we should not consider.
Contrary to Leigh's assertions, the facts in this petition only
reveal that Leigh might improve over time, not that he was
deteriorating. Since we do not know how the Board will construe
AS 23.30.265(21) in relation to a deteriorating claimant we
decide the constitutionality of this statute as it applies to
Leigh.13
Leigh also argues that the Municipality is "quasi
estopped" from making this anti-hypothetical argument given its
statement in its Petition for Review that an important
constitutional question is involved. However, the Municipality
never asserted that Leigh's condition was deteriorating. Rather,
true to Dr. Vasileff's statements and the Board's decision, it
stated that Leigh "was medically stable." In fact, the
Municipality specifically argued in its petition that "The Lower
Court's Decision was Advisory in Nature in That it was Based Upon
Hypothetical Facts." Therefore, Leigh's quasi-estoppel argument
lacks merit; the Municipality's position in its brief before this
court is consistent with its position in its petition.14
B. Substantive Due Process, The Statutory
Presumption, and The Burden of Rebutting The
Presumption
Alaska Statute 23.30.265(21) reads in part that:
medical stability shall be presumed in
the absence of objectively measurable
improvement for a period of 45 days; this
presumption may be rebutted by clear and
convincing evidence . . . .
(Emphasis added.)
The Municipality persuasively argues that it is neither
constitutionally impermissible nor inconsistent for the
legislature to shift the burden of proving lack of medical
stability to the employee upon the happening of a particular
event -- such as the continued lack of improvement for 45 days.
Concerning the alleged difficulty that this burden places on the
employee the Municipality again persuasively asserts that:
This evidence is easily obtained by
examining the treating physician. That is,
the treating physician should have no
difficulty offering an opinion on whether or
not further objectively measurable
improvement is expected. The 45 day
provision merely signals when that proof is
necessary. The alleged difficulty in proving
the nonexistence of medical stability, simply
fades when viewed in light of the proof
actually required.
Thus we reject Leigh's contention that the burden of
proof provided for in AS 23.30.265(21) violates substantive due
process.
The effect of this 1988 amendment is to restrict the
application of the presumption provided for in AS 23.30.120.15
Leigh has not provided us with any authority for the proposition
that the legislature lacks the authority to narrow a presumption
that it previously enacted.16 We therefore reject Leigh's
contention that the presumption of medical stability provided for
by AS 23.30.265(21) violates substantive due process.
D. Conclusion
We hold that Leigh's substantive due process attack on
the definition of medical stability articulated by AS
23.30.265(21), the presumption provided for in this statute, and
the burden placed upon the employee to rebut this presumption
should be rejected. Leigh has failed to meet his heavy burden of
demonstrating that no rational basis exists for these three
questioned components of AS 23.30.265(21). Given the
legislature's explicit goal of insuring "the quick, efficient,
fair, and predictable delivery of indemnity and medical benefits
to injured workers at a reasonable cost to the employers"who are
subject to the Act, we conclude that AS 23.30.265(21) is not
arbitrary since
it bears a reasonable relationship to a legitimate, rational,
governmental policy.17
REVERSED.
_______________________________
3. AS 23.30.185 provides,
Compensation for temporary total
disability. In case of disability total in
character but temporary in quality, 80
percent of the injured employee's spendable
weekly wages shall be paid to the employee
during the continuance of the disability.
Temporary total disability benefits may not
be paid for any period of disability
occurring after the date of medical
stability.
4. AS 23.30.265(21) reads as follows:
"[M]edical stability"means the date
after which further objectively measurable
improvement from the effects of the
compensable injury is not reasonably expected
to result from additional medical care or
treatment, notwithstanding the possible need
for additional medical care or the
possibility of improvement or deterioration
resulting from the passage of time; medical
stability shall be presumed in the absence of
objectively measurable improvement for a
period of 45 days; this presumption may be
rebutted by clear and convincing evidence.
5. While the AMA Guide does not contain a definition per se
of medical stability, the preface to this work states the
following:
In general, it is not possible for a
physician, using medical information alone,
to make reliable predictions about the
ability of an individual to perform tasks or
to meet functional demands. A physician can
determine, however, whether or not a
particular medical condition has become
permanent because it is static or well-
stabilized. When it is stable, there is no
medical reason to expect that the individual
will gain or lose future functional ability.
When functional ability is assessed by a
standardized nonmedical procedure in a
vocational rehabilitation facility or in an
occupational setting, the physician may have
confidence in the determination.
American Medical Association, Guides to the Evaluation of
Permanent Impairment, at x (2d ed. 1984).
6. Article I, Section 7 of the Alaska Constitution states,
"No person shall be deprived of life, liberty or property without
due process of law."
7. This court uses its independent judgment on questions of
statutory interpretation that do not involve the Board's special
expertise. Phillips v. Houston Contracting, Inc., 732 P.2d 544,
546 (Alaska 1987). Constitutional questions are also questions
of law to which this court applies its independent judgment.
Sonneman v. Knight, 790 P.2d 702, 704 (Alaska 1990). The court
must adopt "the rule of law that is most persuasive in light of
precedent, reason, and policy."Guin v. Ha, 591 P.2d 1281, 1284
n.6 (Alaska 1979).
8. See Wein Air Alaska v. Kramer, 807 P.2d 471, 474 (Alaska
1991) (citing Hewing v. Peter Kiewit & Sons, 586 P.2d 182, 185-86
(Alaska 1978)). In fact, in Bignell v. Wise Mechanical
Contractors, 651 P.2d 1163, 1167 (Alaska 1982), we held that the
Board may award TTD benefits to an employee with an unscheduled
disability whose condition had stabilized medically, but who was
pursuing an approved vocational rehabilitation program. And in
Bailey v. Litwin Corp., 713 P.2d 249, 253 (Alaska 1986), this
court held that "medical stability"is irrelevant in determining
cessation of TTD benefits if the employee has returned to work.
Bailey held that the claimant's return to work was "sufficient
evidence to rebut the presumption of continuing compensability
for temporary total disability." Bailey, 713 P.2d at 254
(footnote omitted).
9. The legislature also directed that temporary partial
disability terminate on medical stability. See AS 23.30.200. By
virtue of these amendments the Act was aligned with the workers'
compensation statutes of many other states. "Case law from other
jurisdictions overwhelmingly reflects the view that medical
stabilization, or maximum physical recovery, marks the end of
temporary disability." Bignell, 651 P.2d at 1169 (Rabinowitz and
Matthews, J.J., dissenting) (footnote omitted). Professor Larson
notes that in most states temporary benefits cease when the
"healing period"has ended and "stabilization"has occurred. 2
A. Larson, The Law of Workmen's Compensation, 57.12 at 10-9
(1983) (cited in Bailey v. Litwin Corp., 713 P.2d 249, 253 n.11
(Alaska 1986)).
10. The legislature's desire to lower workers' compensation
costs was reinforced by a letter of intent from the Senate
included in the Senate Journal:
With an actuarial analysis concluding
that this bill will provide a two percent
savings in hard costs and an unquantifiable
amount of soft dollar savings, it is the
intent of the Alaska State Senate that, upon
passage of this bill, the Division of
Insurance request a new rate filing
reflecting a reduction in workers'
compensation premiums.
1988 Senate Journal 2420. A report of the Workers' Compensation
Labor-Management Task Force also chronicled the increase in
workers' compensation insurance costs. This Task Force was
resurrected in 1986, following a rate increase by the Department
of Workers' Compensation Insurance "with the purpose of reducing
rates paid by employers through legislative changes to the
Statute." (Workers' Compensation Labor-Management Task Force,
Synopsis of Proposed Legislative Changes to Chapter 30 of Title
23, p.1)
11. The term is not specifically defined in the Guide's
glossary, nor is there any prolonged discussion of the term. In
fact, contrary to the discussion in the preface, the AMA defines
"permanent impairment" in the glossary as including
deterioration.
Permanent impairment is impairment that
has become static or well stabilized with or
without medical treatment, or that is not
likely to remit despite medical treatment of
the impairing condition.
AMA, Guides to the Evaluation of Permanent Impairment, at 225.
Hence, the definition in the Guide appears inconclusive as to
whether deterioration is consistent with a permanent impairment
determination, although the glossary indicates the two are
consistent.
12. The legislature's awareness of the AMA Guide is evident
from AS 23.30.190(b), where it mandates the Guide's use for
determining the existence and degree of permanent impairment.
Leigh further argues that it is inconsistent to use AMA Guide for
the determination of PPI, yet not TTD. Leigh fears a time gap in
benefits, but such is a hypothetical concern as Leigh received
PPI when his TTD benefits terminated.
13. The United States Supreme Court summarized the rule
well.
A party has standing to challenge
the constitutionality of a statute only
insofar as it has an adverse impact on his
own rights. As a general rule, if there is
no constitutional defect in the application
of the statute to a litigant, he does not
have standing to argue that it would be
unconstitutional if applied to third parties
in hypothetical situations. A limited
exception has been recognized for statutes
that broadly prohibit speech protected by the
First Amendment. This exception has been
justified by the overriding interest in
removing illegal deterrents to the exercise
of the right of free speech. That
justification, of course, has no application
to a statute that enhances the legal risks
associated with riding in vehicles containing
dangerous weapons.
County Court of Ulster v. Allen, 442 U.S. 140, 154-55 (1979)
(citations omitted). However, the Court did go on to explain
that in the case of a mandatory presumption in a criminal case
(which is similar to the presumption in the case at bar), the
Court examines its constitutional validity divorced from the
facts at bar and bases it on the presumption's accuracy in the
run of cases. Id. at 159.
14. We note that the Act provides other benefits when TTD
benefits cease, e.g. permanent total disability benefits ("PTD"),
AS 23.30.180, and permanent partial impairment benefits ("PPI"),
AS 23.30.190. Here Leigh received PPI benefits when he was found
medically stable and TTD benefits ceased. If the worker's
condition deteriorates, the Board can later modify these other
awards. AS 23.30.130. See Alaska Indus. Bd. v. Chugach Elec.
Ass'n, 17 Alaska 183 (9th Cir. 1957) (provision allows Board to
increase compensation to cover adverse changes in physical
condition subsequent to an award), rev'd on other grounds, 356
U.S. 320 (1958). Moreover, the Act does not limit medical
benefits if continued treatment is needed. AS 23.30.095.
The Municipality argues that this result is consistent
with maintenance and cure under general maritime law. The law
has been summarized as follows:
The obligation to pay maintenance and
cure continues until the seaman is cured or,
if there is permanent impairment, until he
reaches the point of maximum medical
recovery. The test for maximum medical
recovery is "when it appears probable that
further treatment will result in no
betterment of the seaman's condition." In
the case of permanent injury, maintenance and
cure continues until the seaman's incapacity
is diagnosed as being permanent. . . . The
seaman may still institute a new proceeding
if there is a later possibility of new
curative treatment.
Schoenbaum, Admiralty and Maritime Law 161-62 (1987) (footnotes
omitted).
15. Alaska Statute 23.30.120(a)(1) provides:
(a) In a proceeding for the enforcement
of a claim for compensation under this
chapter it is presumed, in the absence of
substantial evidence to the contrary, that
(1) the claim comes within the
provisions of this chapter;
16. The Municipality points to AS 23.30.120(c) as an
instance where the legislature restricted the scope of the
presumption found in AS 23.30.120(a)(1) for claims involving
mental injury.
17. See Taylor v. Southeast-Harrison Western Corp., 694 P.2d
1160, 1162 (Alaska 1985), where we noted that the legislature was
required "to balance a multitude of complex factors, many of
which involved competing interests"in enacting the Workers'
Compensation Act.
Leigh also attacks the definition, presumption, and bur
den of proof provisions of AS 23.30.265(21) on the basis that
they are violative of equal protection. Essentially, Leigh
argues that the statute arbitrarily distinguishes between injured
workers who improve every 45 days and those who do not improve or
whose condition worsens. Leigh's argument is based on the Alaska
Constitution and overlaps substantially with his claim that these
provisions violate substantive due process.
In Wilson v. Municipality of Anchorage, 669 P.2d 569,
572 (Alaska 1983) we said:
In order for a classification to be
valid under Alaska's equal protection test,
it must be reasonable, not arbitrary, and
must bear a fair and substantial relation to
a legitimate governmental objective.
Depending on the importance of the
individual's interest involved, a greater or
lesser burden will be placed on the state to
show this fair and substantial relationship.
For the reasons stated in our discussion of Leigh's substantive
due process claims we conclude that the definition of medical
stability, the presumption, and the rebuttal burden of proof are
not violative of equal protection.
Leigh also argues that the Board erred as a matter of
fact in determining that Leigh failed to prove by clear and
convincing evidence that he was not medically stable on January
25, 1989. This contention lacks merit. Most significantly, Dr.
Vasileff himself said Leigh was medically stable using the
statutory definition. Our review of the record indicates that
the Board's agreement with this was not erroneous.
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