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Penalties Against Self-Insured Employers

If medical bills aren’t paid when due or medical treatment not authorized in a timely fashion, it can cause significant harm to injured workers and their families. Consistent nonpayment or late payment of medical bills is one of the reasons doctors opt out of treating injured workers. It’s just too much of a headache for the doctor to continually push for payment of their bills. The bill can end up in the hands of a collection agency and, if that happens, the worker’s personal finances are impacted and their credit negatively affected. Late or nonpayment of medical bills can also delay a worker’s recovery.

RCW 51.48.017 is the statute that provides for penalties if a self-insured employer delays or refuses to pay benefits when due. Self-Insured employers interpreted this statute to only apply to “monetary” benefits payable to the claimant, such as time loss compensation, loss-of-earning power benefits, or a permanent partial disability award. The Department issued penalties only for delay in those monetary benefits. The statute states:

If a self-insured unreasonably delays or refuses to pay benefits as they become due there shall be paid by the self-insured upon order of the director an additional amount equal to five hundred dollars or twenty-five percent of the amount then due, whichever is greater, which shall accrue for the benefit of the claimant and shall be paid to him or her with the benefits which may be assessed under this title. The director shall issue an order determining whether there was an unreasonable delay or refusal to pay benefits within thirty days upon the request of the claimant. Such an order shall conform to the requirements of RCW 51.50.050.

The 2012 significant decision by the Board of Industrial Insurance Appeals – In re James C. Coston – changed that “benefit” definition to include medical bill payments.
Under this recent decision, the Department of Labor & Industries can order penalties against self-insured employers for late or non-payment of medical bills for claim-related treatment.

The Department of Labor & Industries has proposed and will implement new administrative rules regarding late payment of medical bills and delayed treatment authorization. The new rules will define how to file the penalty request and when the Department of Labor & Industries will issue a penalty. This will extend the Department’s oversight of self-insured employer actions and will specifically address timely payment of all benefits owed to the injured worker.

Injured workers are entitled to payment of time loss compensation while they are unable to work due to an industrial injury or occupational disease. They and their families rely on accurate and timely payment of all claim-related benefits. Delays in the payment of any type of benefit can cause significant hardship for the worker. Implementation of this new rule is another tool for workers in their fight for benefits.
Please call us if you have any questions about your workers’ compensation benefits.

Patrick Cook is an associate attorney at The Walthew Law Firm and practices workers’ compensation and personal injury law.

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