OAH 8-1900-21251-2
STATE OF
OFFICE OF ADMINISTRTIVE HEARINGS
FOR THE DEPARTMENT OF LABOR AND INDUSTRY
|
In the Matter of the QRC Firm Registration of PAR, Incorporated |
FINDINGS OF FACT, CONCLUSIONS AND RECOMMENDATION |
This matter came before Administrative Law Judge Eric L. Lipman for an evidentiary hearing on December 15 and 17, 2010 and January 6 and 7, 2011.
Earlier, in April of 2010, the Department of Labor and Industry filed a 19-count complaint against Professional Associates of Rehabilitation, Inc. (PAR). The complaint asserted that PAR’s business and client service practices violated various provisions of Minnesota Rules Chapter 5220.
Following the receipt of post-hearing submissions, the hearing record closed on March 7, 2011.
STATEMENT OF ISSUES
The issues presented in this case are as follows:
1. Is John Richardson’s conduct attributable to PAR for purposes of discipline of PAR’s Rehabilitation Firm registration?
2. Was John Richardson’s conduct in serving clients K.A. and C.J. inconsistent with the requirements of PAR’s registration as a Rehabilitation Firm?
3. Did PAR’s employment agreements with Brian Finstead and Gerald Guzik violate the prohibitions on fee-splitting by Qualified Rehabilitation Consultants?
4. Did PAR’s employment agreements with Brian Finstead and Gerald Guzik violate the rights of client-employees to choose a qualified rehabilitation consultant, under Minn. Stat. 176.102, subd. 4?
5. Did PAR violate its duty to cooperate with the Department’s investigation of misconduct?
The Administrative Law Judge concludes that the conduct of PAR’s owner, John Richardson, is properly attributable to PAR, and that his conduct while serving C.J. and K.A. was inconsistent with PAR’s role as a Rehabilitation Firm. Additionally, the Administrative Law Judge concludes that while PAR’s employment agreements with Brian Finstead and Gerald Guzik violated the prohibition on fee-splitting among Qualified Rehabilitation Consultants, the arrangements did not deprive any client-employees of the opportunity to freely choose a rehabilitation provider. Lastly, the Administrative Law Judge concludes that the Department did not establish that PAR failed to cooperate with its investigation.
Based upon the hearing record, the Administrative Law Judge makes the following:
FINDINGS OF FACT
Practice Among
1. Rehabilitation providers are registered under Minn. Stat. § 176.102 (2010). The statute recognizes three types of rehabilitation providers: a Qualified Rehabilitation Consultant (QRC), a QRC firm, and a registered rehabilitation vendor.[1]
2.
A QRC is a professional who provides vocational
rehabilitation services to injured employees in the state of
3. A “rehabilitation firm” is a legal entity that employs Qualified Rehabilitation Consultants.[3]
4.
While other states have licensing regimens that
are similar to
5. Employees who are eligible to receive rehabilitation services from rehabilitation providers are referred to as “Qualified Employees.” Minn. R. 5220.0100, subp. 22 defines “qualified employee" as:
[A]n employee who, because of the effects of a work-related injury or disease, whether or not combined with the effects of a prior injury or disability:
A. is permanently precluded or is likely to be permanently precluded from engaging in the employee's usual and customary occupation or from engaging in the job the employee held at the time of injury;
B. cannot reasonably be expected to return to suitable gainful employment with the date-of-injury employer; and
C. can reasonably be expected to return to suitable gainful employment through the provision of rehabilitation services, considering the treating physician's opinion of the employee's work ability.”[5]
6. Typically, rehabilitation providers begin their service for clients following a request for an initial consultation – either directly from the employee or from someone acting on the employee’s behalf. An initial consultation may be requested by the employee, the employer, or the Department.[6]
7. Likewise important, consultations by rehabilitation providers can either be consented to by the insurer – in cases in which there is an agreement on the payment for such services – or not consented to by the insurer. In the latter circumstance, a rehabilitation provider who does provide services to an injured worker that is later determined to be a “qualified employee,” may receive a monetary award for those services from a compensation judge. Many rehabilitation providers do provide services to injured workers without an agreement to be compensated by an insurer, believing that they will later win payment for those services as part of an award in a workers compensation case.[7]
8. Ordinarily, an initial consultation is the first in-person meeting between the employee and a rehabilitation provider. The initial consultation permits the rehabilitation provider to gather information, determine whether the employee is a qualified employee and whether the employee would benefit from the services of a Qualified Rehabilitation Consultant.[8]
9.
Under
10.
Only a registered Qualified Rehabilitation
Consultant is permitted to perform an initial consultation in
11. From the Department’s perspective, independence and professional distance between rehabilitation providers and the parties to a workers compensation dispute are important objectives of the rules in Chapter 5220. Because of the influential role that such providers play in guiding treatment and rehabilitation plans, the Department insists upon neutrality among rehabilitation providers.[11]
PAR’s Founding and Operations
12.
John Richardson is a 1986 graduate of the
13. Mr. Richardson first obtained his QRC registration in 1986.[13]
14. Mr. Richardson began his professional work in the field of rehabilitation as a QRC intern for Marsha Ellingson.[14]
15. In 1988, Mr. Richardson established the rehabilitation firm PAR Inc., and is the firm’s sole owner.[15]
16. PAR’s principal work is in providing services to those persons undergoing statutory rehabilitation under Minnesota Statutes, Chapter 176.[16]
17. For a time, PAR employed 26 employees – 12 of these as Qualified Rehabilitation Consultants.[17]
18. As part of its business operations, PAR provides Mr. Richardson a salary, performance bonuses, health insurance, office space and equipment – including a cellular phone.[18]
19. In the years since he obtained his QRC registration, Mr. Richardson has been targeted for regulatory discipline on several occasions. Many of these complaints related to the claimed failure of Mr. Richardson to maintain respectful and appropriate professional boundaries – and were resolved by Mr. Richardson submitting a written apology for his behavior to the person who submitted the complaint.[19]
20. As part of the settlement of an action by the Department in 2008, Mr. Richardson voluntarily surrendered his QRC registration. Under the agreement, Mr. Richardson could continue to participate in the management of PAR, but could not undertake functions requiring a QRC registration. Further, PAR was still bound by the professional obligations of Chapter 5220. The agreement provided:
While Respondent is not registered as a QRC, he may remain employed by and continue to own Professional Associates of Rehabilitation, but he shall retain another individual, who is currently registered as a QRC, to act as one of the management staff, as required by Minn. R. 5220.1600, subp. 1. The Commissioner acknowledges that this agreement does not prohibit Respondent from participating in the business management functions of the firm. Upon the Department’s request, Respondent shall provide information demonstrating compliance with this provision.
While Respondent’s QRC registration is withdrawn, he acknowledges that the law prohibits him from acting as a supervising QRC for any QRC intern If Respondent reregisters as a QRC, he specifically acknowledges and agrees that he will not act as a supervising QRC for live, calendar years after the date of the renewal of his registration.
The Commissioner acknowledges that this agreement does not preclude Respondent from engaging in professional activities that do not require registration as a QRC, including, but not limited to, acting as an expert witness.
Respondent reaffirms his commitment, as well as the commitment of his firm, Professional Associates of Rehabilitation, Inc., to comply with Minn. Stat. § 176.102 and Minn. R. Ch. 5220, including, but not limited to, the rules identified in paragraph 2 above.[20]
The Services Delivered to C.J.
21. In the Spring of 2008, following a presentation that he had given on workers compensation law, Roger Poehls was approached by C.J., an employee of Northwest Airlines. The two briefly discussed C.J.’s case and Poehls agreed to undertake representation of C.J.[21]
22. Because C.J. had worked with other lawyers and providers in the past, and she had a number of medical records associated with her claims, Poehls was eager for an assessment from a rehabilitation provider. Yet, Liberty Mutual, the insurer for C.J.’s employer, declined to authorize (and pay for) such a consultation.[22]
23. Deciding to commission, and pay for, such an assessment, Mr. Poehls faxed a letter to PAR requesting an initial consultation in the C.J. case. Poehls sent this letter on March 13, 2008.[23]
24. Poehls wanted someone from PAR to attend an upcoming medical appointment that C.J. had scheduled with her physician, Dr. Janus Butcher. Poehls was eager for some assistance in assessing C.J.’s condition, treatment history and potential claims.[24]
25. Following the receipt of the letter from Poehls by facsimile, PAR’s managing QRC, Leon Olson, wrote a letter to C.J. The letter identified C.J. as “a potential client of PAR, Inc.” and advised that C.J. could contact John Richardson regarding “potential services that may be available to you.”[25]
26. Further, and also on March 13, 2008, PAR wrote to C.J.’s insurance company to request authorization for rehabilitation services.[26]
27. In early April of 2008, C.J.’s insurance company declined to authorize rehabilitation services. Notwithstanding the lack of authorization, PAR decided that it would provide such services and submit a claim for reimbursement as part for these services as part of the workers compensation process. A QRC employee of PAR, Michelle Pohmer, decided to perform an initial consultation of C.J. at Dr. Buther’s office on April 11, 2008.[27]
28. On April 11, 2008, inclement weather forced Dr. Butcher’s office to close and C.J.’s appointment was cancelled.[28]
29. Under his settlement agreement with the Department, John Richardson’s last day as a registered QRC was April 15, 2008.[29]
30. On April 16, 2008, C.J. telephoned Ms. Pohmer to inform her that the appointment with Dr. Butcher had been re-scheduled to the following day. Ms. Pohmer returned C.J.’s call and left a message stating that Mr. Richardson would be attending the appointment with Dr. Butcher.[30]
31. Mr. Richardson met C.J. for the first time on April 17, 2008, when he observed C.J.’s appointment with Dr. Butcher.[31]
32. During the appointment, Mr. Richardson conferred with Dr. Butcher as to features of C.J.’s condition.[32]
33. As of April 16, 2008, Mr. Richardson had not obtained written consent from C.J. to engage in communications with her health care providers.[33]
34. Following the appointment, Mr. Richardson wrote to Dr. Butcher. In this letter he detailed the vocational rehabilitation and job modifications that he thought were appropriate to C.J.’s circumstances.[34]
35.
Additionally,
The Services Delivered to K.A.
36.
K.A. was a network technician with Qwest, Inc.
from April 2000 until March of 2009. As
part of his duties, he would install, maintain and repair telephone lines and
equipment in
37. On February 22, 2008, while undertaking his duties as a technician, K.A. injured his lower back.[37]
38. Following his injury, and consistent with the restrictions placed on these duties by K.A.’s physician, K.A. was reassigned to various light duties.[38]
39. Qwest’s policy is to only offer light duty assignments to its technicians for a limited time. After a field technician is on light duty for 180 days, the technician is granted another 80 days to find a new permanent job within the company. If the technician does not find a suitable position within that time period, the employee is terminated.[39]
40. Increasingly anxious about his ability to return to work as a network technician, as he hoped, K.A. contacted Mr. Richardson of PAR. K.A. was referred to Mr. Richardson by a fellow Qwest employee.[40]
41. K.A. and Mr. Richardson met for breakfast in early June of 2008. The two discussed K.A.’s condition, limitations and treatment progress. Additionally, Mr. Richardson reviewed K.A.’s records.[41]
42.
On June 11, 2008,
43. As of June 11, 2008, Mr. Richardson had not obtained written consent from K.A. to engage in communications with his health care providers.[43]
44.
As he left K.A. at Dr. Schulenberg’s office, Mr.
Richardson gave K.A. his PAR business card.
45. On June 21, 2008, K.A. completed a written request for a rehabilitation consultation from PAR.[45]
46. Qwest’s insurer did not immediately authorize K.A.’s participation in the Med-Ex program. Instead, it advised PDR that it wanted to its own physician to review the features of the program.[46]
47. On June 23, 2008, Carla Bruner, an employee of PDR, telephoned Mr. Richardson and urged him to speak with the insurer regarding its concerns. Bruner was eager to obtain the authorization for services to K.A.[47]
48.
Following Ms. Bruner’s call,
49. At the start of the conversation, Mr. Richardson identified himself as K.A.’s “QRC” – an acronym that, at the time, was unfamiliar to Ms. Micale. As the two discussed the particulars of the treatment recommendation for K.A., the exchange between the two became tense and sharp. Frustrated with the lack of authorization and apparent understanding of the program, Mr. Richardson was hostile and disparaging to Ms. Micale during this call.[49]
50. On June 27, 2008, PAR conducted an initial consultation for K.A.[50]
51. On July 2, 2008, PAR’s managing QRC, Leon Olson, determined that K.A. was a qualified employee who was in need of statutory rehabilitation services. There were no significant changes in K.A.’s medical condition or employment situation between mid-June 2008 and the end of June 2008.[51]
52. Intracorp later authorized the rehabilitation services provided to K.A. by PAR. PAR billed $5,650.16 for rehabilitation services provided to K.A.[52]
PAR’s Non-Competition Agreements with its QRC Interns
53.
In 2006, PAR had employment agreements with two
QRC Interns – Brian Finstead and Gerald Guzik.[53]
54.
The
agreements provided in part:
As a QRC, or QRC-I you agree that you will not solicit, or attempt to leave the company with clients irrespective of the reason for separation of employment. You acknowledge that all clients are the proprietary property of PAR, Inc. and that you will not take or maintain any records related to clients other than those authorized by PAR, Inc. Upon separation of employment all records including names, phone numbers, medical information, etc. will be returned to PAR, Inc.
If any injured worker chooses to continue their professional relationship with a QRC, or QRC—I for any reason after separation of employment PAR, Inc. is entitled to liquidated damages of $2000.00, or 50% of fees generated after separation of employment and until the file closes with an R-8. Absent agreement PAR, Inc. will maintain the right to determine which method of reimbursement is appropriate under the circumstances of each case.
Each QRC, and QRC-I agrees that for a period of one (1) year they will not contact any referral sources of PAR, Inc. All attorneys that refer cases to PAR, Inc. during the year preceding separation of employment will be considered referral sources.[54]
55.
In 2008, within one month of Gerald Guzik
obtaining registration as a QRC, he and Mr. Finstead started their own firm –
Integrity Rehabilitation, LLC. Among the
clients of the new firm were five persons whom Guzik and Finstead had worked
with while employed as QRC Interns for PAR.
One of these clients has an “open file,” with matters that are still to
be finally resolved with the employer and insurer.[55]
56.
In one instance, PAR sent demand letters to the
insurer in a matter where a former client of PAR was receiving rehabilitation
services from Integrity Rehabilitation, LLC.
The letters demanded that the fees remitted to Integrity Rehabilitation
be jointly payable to both firms.[56]
57.
Litigation ensued between the two firms; claims
that were settled in advance of a trial.[57]
The Department’s
Investigation of PAR’s Business Practices
58.
Prompted in part by claims of misconduct
involving Mr. Richardson, the Department undertook an investigation of PAR’s
business practices in August of 2008.[58]
59. As part of its inquiries, the Department requested that PAR produce all documents relating to the services it provided to K.A. and C.J.[59]
60. As part of its initial disclosure to the Department in response to its request for documents, PAR did not produce:
(a) a completed “initial interview form” associated with K.A.;
(b) a completed “initial interview form” associated with C.J.; or,
(c) the invoice for services to Robert Wilson & Associates.[60]
61. The initial interview form associated with C.J. and the invoice for services to Robert Wilson & Associates, were later disclosed by PAR to the Department.[61]
Based on the Findings of Fact, the Administrative Law Judge makes the following:
CONCLUSIONS
I. Jurisdiction
1. The Administrative Law Judge and the Rehabilitation Review Panel have jurisdiction over this matter pursuant to Minn. Stat. §§ 14.50 and 176.102.
2. The Department has complied with all substantive and procedural requirements of law and rule.
3. PAR is “rehabilitation provider” as those terms are used in Minn. R. 5220.0100, subp. 28.
4. The professional conduct of PAR’s owner and employee, John Richardson, is attributable to PAR. PAR’s rehabilitation firm registration is properly subject to regulatory discipline on account of any misconduct by Mr. Richardson.[62]
II. The Regulatory Implications
of the Services Provided to C.J. and K.A.
A.
Status
as a Qualified Employee
5. An “agent of a rehabilitation provider” may only engage “in those activities designated in Minnesota Statutes, section 176.102, and rules adopted thereunder.”[63]
6. In April of 2008, C.J. was an employee who was likely to be permanently precluded from engaging in her usual and customary occupation or from engaging in the job the employee held at the time of injury. Accordingly, she was a “qualified employee” as those terms are used in Minn. R. 5220.0100, subp. 22.
7. Because C.J. was a “qualified employee,” it was improper for PAR to permit its resources to be used to provide services that did not conform to the standards of Minn. R. Chapter 5220.
8. In June of 2008, K.A. was an employee who was likely to be permanently precluded from engaging in his usual and customary occupation or from engaging in the job the employee held at the time of injury. Accordingly, he was a “qualified employee” as those terms are used in Minn. R. 5220.0100, subp. 22.
9. Because K.A. was a “qualified employee,” it was improper for PAR to permit its resources to be used to provide services that did not conform to the standards of Minn. R. Chapter 5220.
B. Professional Objectivity
10. Minn. R. 5220.1801, subp. 4a requires rehabilitation providers to “remain professionally objective in conduct and in recommendations on all cases.”
11. John Richardson, an employee and owner of PAR, did not remain professionally objective when recommending Intracorp’s authorization of the MedX program for K.A.
C. Obtaining Written Consent
12. Minn. R. 5220.1801, subp. 5, prohibits a rehabilitation provider from engaging in communications with health care providers about an employee “without the written consent of the employee.”
13. John Richardson engaged in communications with health care providers for C.J. without first having obtained the written consent from C.J. for those communications.
14. John Richardson engaged in communications with health care providers for K.A. without first having obtained the written consent from K.A. for those communications.
D.
Advocacy
on Claims or Entitlement
15. Minn. R. 5220.1801, subp. 8, bars a “qualified rehabilitation consultant, qualified rehabilitation consultant intern, or registered rehabilitation vendor” from acting as an advocate for, or advising any party about, a claims or entitlement issue.
16. While John Richardson did advise a party about a claims or entitlement issue in late April of 2008, neither he nor PAR was a “qualified rehabilitation consultant, qualified rehabilitation consultant intern, or registered rehabilitation vendor,” as those terms are used in Minn. R. 5220.1801, subp. 8.
E.
Providing
Rehabilitation Services
17. Minn. R. 5220.1801, subp. 9 (J), prohibits rehabilitation providers from “knowingly aiding, assisting, advising, or allowing an unqualified person to engage in providing rehabilitation services.”
18. Further, Minn. R. 5220.0100, subp. 29, defines “rehabilitation services” as a “program of vocational rehabilitation, including medical management, designed to return an individual to work consistent with Minnesota Statutes, section 176.102, subdivision 1, paragraph (b).” This regulation provides further that
services under this program may include, but are not limited to, vocational evaluation, counseling, job analysis, job modification, job development, job placement, labor market survey, vocational testing, transferable skills analysis, work adjustment, job seeking skills training, on-the-job training, and retraining.
19. John Richardson’s work in discussing C.J.’s condition with her physician, and remitting his rehabilitation and job modification recommendations to Dr. Butcher, on PAR letterhead, amounts to “rehabilitation services” as those terms are used in Minn. R. 5220.0100, subp. 29.
20. John Richardson’s work in recommending and facilitating K.A.’s enrollment in the MedX program amounts to “rehabilitation services” as those terms are used in Minn. R. 5220.0100, subp. 29.
21. Because John Richardson had surrendered his Qualified Rehabilitation Consultant certification at the time he rendered services to K.A., PAR is properly subject to regulatory discipline for permitting an unqualified person to provide rehabilitation services.
F.
Adversarial
Communications
22. Minn. R. 5220.1801, subp. 9 (K) prohibits rehabilitation providers from “engaging in adversarial communication or activity ….” For purposes of this regulation, the term adversarial communication includes “misrepresentation of any fact or information about rehabilitation ….”
23. Mr. Richardson, an agent of PAR, engaged in adversarial communications when he misrepresented the status of his QRC registration to Denise Micale. This misrepresentation was material to obtaining rehabilitation services for K.A.
24. The misrepresentation was closely related to obtaining a good result for K.A. and, for PAR, winning K.A. as a rehabilitation services client.
G.
Maintaining
Proper Accreditation
25. Minn. R. 5220.1801, subp. 10, requires rehabilitation providers to “limit themselves to the performance of only those services for which they have the education, experience and qualifications.”
26.
PAR is properly subject to regulatory discipline
for permitting John Richardson to provide rehabilitation services to K.A. after
the time that
H.
Maintaining
Accuracy in Disclosures
27. Minn. R. 5220.1801, subp. 10, requires that rehabilitation providers “accurately represent their level of skill and competency to the department, the public, and colleagues.”
28. PAR is properly subject to regulatory discipline for John Richardson’s misrepresentation of the status of his QRC registration to Denise Micale.
III. Provisions of the PAR Employment
Agreements
29. Minn. R. 5220.1801, subp. 1, restricts involvement in employee’s rehabilitation plan, in all but limited circumstances, that are not applicable here, to “the assigned qualified rehabilitation consultant ….”
30. Minn. R. 5220.0710, subp. 1, further provides that injured workers have the right to “choose a qualified rehabilitation consultant as defined in part 5220.0100, subp. 23, once at any time in the period beginning before the rehabilitation consultation and ending 60 days after filing of the rehabilitation plan.”
31. The provisions of the PAR employment agreements with Brian Finstead and Gerald Guzik did not impair the right of any qualified employee to choose a qualified rehabilitation consultant.
32. Minn. R. 5220.1805 (G) prohibits a rehabilitation provider from incurring profit, splitting fees, or having an ownership interest with another rehabilitation provider outside of the firm that employs the provider.
33. PAR is properly subject to regulatory discipline for entering into an agreement for “splitting fees … with another rehabilitation provider outside of the firm that employs the provider.”
34. Minn. R. 5220.1900, subp. 2, limits rehabilitation providers to billing only for “those necessary and reasonable services that are rendered in accordance with Minn. Stat. § 176.102 and the rules adopted to administer that section.”
35. The provisions of the PAR employment agreements with Brian Finstead and Gerald Guzik did not oblige either PAR or Integrity Rehabilitation to bill for other than “those necessary and reasonable services that are rendered in accordance with Minn. Stat. § 176.102 and the rules adopted to administer that section.”
IV. Cooperation with the
Department’s Investigation
36. Minn. R. 5220.1801, subp. 4, requires rehabilitation providers to respond “fully and promptly to any questions raised by the commissioner relating to the subject of the investigation, and providing copies of records, reports, logs, data, and cost information as requested by the commissioner to assist in the investigation.”
37. The Department did not establish by a preponderance of the evidence that PAR failed to meet its obligations to “fully and promptly to any questions raised by the commissioner relating to the subject of the investigation,” and provide copies of records as requested by the Department.
Based upon the foregoing Conclusions, and for the reasons set forth in the attached Memorandum, the Administrative Law Judge makes the following:
RECOMMENDATION
For its failure to meet the regulatory standards set
forth in Minn. R. 5220.1801, subps. 4a, 5, 8, 9(J), 9(K) and 10 and
IT IS HEREBY RECOMMENDED that the Rehabilitation Review Panel impose appropriate regulatory discipline on the Rehabilitation Firm registration, Number 5021, of Professional Associates of Rehabilitation, Inc.
Dated: April 6, 2011
__ s/Eric L. Lipman___________________
ERIC
L. LIPMAN
Administrative
Law Judge
Reported: Digitally Recorded
NOTICE
This Report is a
recommendation, not a final decision.
The Commissioner of the Minnesota Department of Revenue will make a
final decision after a review of the record which may adopt, reject, or modify
the Findings of Fact, Conclusions, and Recommendations in this report. Under Minn. Stat. § 14.61, the final decision
of the Commissioner shall not be made until this Report has been made available
to the parties to the proceeding for at least ten days. An opportunity must be afforded to each party
adversely affected by this Report to file exceptions and to present argument to
the Commissioner. Parties should contact
Dr. Joseph Sweere, Chairman, Rehabilitation Review Panel, Minnesota Department
of Labor and Industry,
Pursuant to Minn. Stat. § 14.62, subd. 1, the agency is required to serve its final decision upon each party and the Administrative Law Judge by first class mail.
MEMORANDUM
PAR’s defense to the regulatory actions is three-fold: It asserts that Mr. Richardson’s service to C.J. and K.A. was separate and distinct from PAR’s business activities. Additionally, it asserts that the employment agreements with Messrs. Finstead and Guzik and its conduct during the Department’s investigation, conform to the regulatory requirements. Each of these defenses is addressed in turn.
I.
The Administrative Law Judge concludes that the actions of John Richardson, PAR’s owner and principal manager, are properly attributable to PAR. A corporation acts through its agents and employees. It is well settled that acts of misconduct by a corporate agent, undertaken to advance the corporation’s interests, are actually and substantially the acts of the corporation.[64]
In
this case, the services that John Richardson undertook for C.J. and K.A. had a
substantial relationship to PAR’s rehabilitation business, were related to
PAR’s business development efforts and were undertaken with the use of PAR
staff, facilities, equipment and materials.
Indeed, even the attorneys who seek
II. Separation of QRC and
Non-QRC Functions
The regulations of Chapter 5220 oblige a strict separation between QRC-related functions and non-QRC functions. For example, Minn. R. 5220.1801, subp. 8 provides:
The
roles and functions of a claims agent and a rehabilitation provider are
separate. A qualified rehabilitation consultant, qualified rehabilitation
consultant intern, registered rehabilitation vendor, or an agent of a
rehabilitation provider, shall engage only in those activities designated in
(Emphasis added). Because of the influential role that rehabilitation providers play in guiding treatment and rehabilitation plans, the rule fulfills an important regulatory objective – maintaining professional distance between rehabilitation providers and the parties to a workers compensation dispute.
The regulations impose upon the registered provider a duty to enforce the applicable boundaries. Under Minn. R. 5220.1801, subp. 9 (E), rehabilitation providers are required to “monitor the performance of services provided by a person working at the rehabilitation provider's direction.”
In this case,
however, the boundaries of strict separation required by the regulations were
abandoned. C.J. and K.A. were shuttled
between
The settlement
agreement signed by
Neither does the
decision In the
Matter of QRC Registration of David M. Scorse require a different result. In Scorse,
the Workers’ Compensation Court of Appeals considered “whether a QRC, when
functioning as a [Disability Case Manager], is subject to the rules of
professional conduct set out in the rehabilitation rules (Minn. R. 5220.1800
- 5220.1806).” The Court concluded that
the regulations requiring objectivity and professional distance among QRCs did
not apply when a registered QRC worked as Disability Case Manager for an
employer or an insurer. The Court held:
Employers and insurers should be able to retain QRCs to provide the disability case management services necessary to return an employee to work. Similarly, a QRC should be free to offer his or her services as a DCM to an employer and insurer. Anytime, however, a QRC becomes an employee or agent of an employer or insurer, the conduct of the QRC on behalf of his employer or principal might well violate Minn. R. 5220.1801, subp. 8. As a practical matter, if an employer or insurer hires a QRC to provide disability case management services, it seems unlikely that the QRC will not “act as an advocate for or advise any party [the employer or insurer] about a claims or entitlement issue.” The very reason the employer or insurer retains a DCM is to represent its interests and accomplish its goals. We do not believe that the intent of the rule was to preclude a QRC from working as a DCM. While not argued by either party, such a result might well violate the constitutional guarantees of equal protection and due process. We conclude, therefore, that Minn. R. 5220.1801, subp. 8, does not apply to a QRC working as a disability case manager but applies only when a QRC is providing statutory rehabilitation services.[69]
An important principle of the Scorse case is that when a QRC is regularly employed by a company or an insurer, it is obvious to all who has the Case Manager-QRC’s loyalty. Notwithstanding the QRC registration held by the Disability Case Manager, in such a circumstance, there is not a genuine expectation that he or she will be disinterested, neutral or objective when discussing rehabilitation plans.
The holding in Scorse is inapposite to this case. First, John Richardson is not working as a disability claims manager for a single employer or insurer. Thus, the Court’s holding does not extend to him.
PAR
asks this tribunal to extend the Scorse
holding to “disability case managers” hired by employees. While the Administrative Law Judge doubts
that he has such powers, the invitation would not be accepted even if he
did. Unlike the unambiguous set of
loyalties held by a QRC that is employed by a single company,
III. The Penalty Provision of
the Employment Contract
PAR asserts that its employment agreements with Messrs. Finstead and Guzik did not violate the proscription of Minn. R. 5220.1805 (G) on incurring profit on the work of other providers or sharing fees with other providers. It asserts that its claim to $2,000, or 50 percent of the fees generated from the date of the separation of employment until the resolution of the client’s workers compensation petition, amounts to “liquidated damages.” The argument is not well taken.
Regardless of how its demand for money is phrased,[71] to the extent that PAR intended to receive revenue for work performed by Integrity Rehabilitation, LLC, it is barred by the regulation. Minn. R. 5220.1805 (G) prohibits fractional shares of the billings of other providers or profiting from work that a rehabilitation provider does not perform. For this reason, regulatory discipline is appropriate.
III. Freedom to Choose a QRC
The Department asserts that the fee-sharing provisions of the PAR employment agreements likewise violate the provisions of Minn. R. 5220.0710. The Department argues that the requirement to remit either $2,000 or 50 percent of the fees to PAR makes service to its former clients so disadvantageous that Messrs. Finstead and Guzik might not make themselves available to former clients of PAR.
While this may be true, this does not amount to a violation of Minn. R. 5220.0710. The rule permits a qualified employee to freely select a willing QRC and makes special provision for those circumstances where, following selection, the QRC is unavailable.[72] The rule is not an entitlement to the services of a QRC so demanded, a guarantee that the hoped-for QRC will serve or a promise that the QRC will make money. These are all matters beyond the four corners of the regulation.
In this case, Messrs. Finstead and Guzik were fully entitled to refuse to serve the clients they met while working at PAR – for financial reasons or no reason.[73] Minn. R. 5220.0710 does not reach or regulate their selection of clients. For that reason, this regulation does not provide a basis to impose regulatory discipline upon PAR.
IV. Cooperation with the
Department’s Investigation
The Department argues that because two documents that it requested were belatedly provided by PAR, and another is suspected to exist, PAR did not “fully and promptly” furnish requested records. The argument is not well taken.
A sizeable cache of documents was provided to the Department in a prompt manner; and two other items, of lesser significance, arrived later. The third item – a completed “initial interview form” for K.A. – has never been established to exist.[74] These shortcomings fall short of the significant obstruction to an agency’s investigation that has formed the basis for discipline in other contested cases.[75]
In the view of Administrative Law Judge, regulatory discipline is not appropriate on this ground.
E. L. L.
[1] Minn. Stat. § 176.102; Minn. R. 5220.0100, subp. 28; Testimony of Philip Moosbrugger, Vol. 1, at 130.
[2] Test. of P. Moosbrugger, Vol. 1, at 131-32.
[3]
[4] Id; see also Minn. Stat. § 176.102.
[5] Minn. R. 5220.0100, subp. 22; Testimony of Gerald Guzik, Vol. 2, at 163.
[6] Minn. R. 5220.0130, subp. 2; Test. of G. Guzik, Vol. 2, at 138-39.
[7] Test. of P. Moosbrugger, Vol. 4, at 22-24; Test of G. Guzik, Vol. 2, at 133-40; Testimony of Marsha Ellingson, Vol. 3 at 87-89.
[8] See,
[9]
[10] Test. of P. Moosbrugger, Vol. 1, at 137; Test. of G. Guzik, Vol. 2, at 141; Testimony of John Richardson, Vol. 2, at 188.
[11] Test. of G. Guzik, Vol. 2, at 161-63; Test. of P. Moosbrugger, Vol. 1, at 133-35; Testimony of Denise Micale, Vol. 2, at 112; compare generally, Minn. R. 5220.1801, subp. 4a (“Good faith disputes may arise among parties about rehabilitation services or about the direction of a rehabilitation plan. A rehabilitation provider shall remain professionally objective in conduct and in recommendations on all cases”).
[12] Test. of J. Richardson, Vol. 2, at 180.
[13]
[14]
[15]
[16]
[17]
[18]
[19] Ex. 47.
[20] Ex. 101 (Emphasis added).
[21] Testimony of Roger Poehls, Vol. 3, at 29.
[22]
[23] Exs. 26 and 28.
[24] Test. of R. Poehls, Vol. 3, at 35-38.
[25] Ex. 27.
[26] Ex. 28; Test. of R. Poehls, Vol. 3, at 35 and 48; see also, Ex. 119.
[27] Exs. 28, 119 and 126 at 46-47.
[28] Ex. 28.
[29] Ex. 101.
[30] Ex. 28; Test. of J. Richardson, Vol. 2, at 245-46.
[31] Test. of J. Richardson, Vol. 2, at 247.
[32]
[33] Ex. 33; Test. of J. Richardson, Vol. 2, at 248.
[34] Ex. 116; compare also, Minn. R. 5220.0100, subp. 29.
[35] Ex. 115
[36] Testimony of K.A., Vol. 1, at 36-37.
[37]
[38]
[39]
[40]
[41]
[42] Ex. 107; Test. of K.A., Vol. 1, at 66; Test. of J. Richardson, Vol. 2, at 260-61.
[43] Ex. 13.
[44] Test. of J. Richardson, Vol. 2, at 205, 257 and 260.
[45] Ex. 9.
[46] Test. of D. Micale, Vol. 2, at 83-85; Ex. 43.
[47] Test. of J. Richardson, Vol. 2, at 209-11.
[48] Test. of D. Micale, Vol. 2, at 81 and 85-86; Exs. 20 and 43.
[49] Test. of D. Micale, Vol. 2, at 86-90.
[50] Ex. 5.
[51] Exs. 6 and 13; Test. of K.A., Vol. 1, at 88-91.
[52] Ex. 10.
[53] Exs. 37-38.
[54] Id (emphasis added).
[55] Ex. 36; Test. of G. Guzik, Vol. 2, at 130, 132 and 159.
[56] Ex. 39.
[57] Exs. 44, 45,123 and124; Test. of G. Guzik, Vol. 2, at 153-57.
[58] Test. of P. Moosbrugger, Vol. 1, at 138-55; Ex. 34.
[59] Test. of P. Moosbrugger, Vol. 1, at 150-55; compare generally, Minn. R. 5220.1806, subp 4.
[60] Exs. 31, 32 and 115; Test. of P. Moosbrugger, Vol. 1, at 155-58.
[61]
[62] See, Memorandum, Section I.
[63]
[64] See, Swanson v. Domning, 86 N.W.2d 716, 721 (Minn. 1957); Thomas
Oil, Inc. v. Onsgaard, 215 N.W.2d 793, 796 (
[65] See, Test. of R. Poehls, Vol. 3, at 39; Testimony of Michael Schultz, Vol. 3, at 18.
[66]
[67] Exs. 5, 6, 13, 27, 28 and 30; Ex. 126 at 46-49.
[68] Ex. 101.
[69] In the Matter of QRC Registration of David M. Scorse, 56 W.C.D. 18, 1996 WESTLAW 749979, Slip op. at * 28 (
[70] See, Findings 25 – 35 and 41 – 52; compare also, Test. of J. Richardson, Vol. 2 at 183 (“I have a fairly significant private practice under the umbrella of PAR, Inc., where I do work on personal injury cases; catastrophic injury cases, at times; long-term disability; not much short-term disability – but occasionally; and Social Security disability”).
[71] Brookfield Trade Ctr., Inc. v. County of Ramsey, 584 N.W.2d 390, 394 (Minn. 1998) ("In interpreting a contract, the language is to be given its plain and ordinary meaning"); accord, Knudsen v. Transport Leasing/Contract, Inc., 672 N.W.2d 221, 223 (Minn. App. 2003).
[72] See, Minn. R. 5220.0710, subps. 1 and 5.
[73] See, Test. of G. Guzik, Vol. 2 at 158-59.
[74] See, Test. of P. Moosbrugger, Vol. 2 at 76-79.
[75] In the Matter of the Revocation of the
Family Child Care License of Patricia Salisbury, OAH No. 12-1800-15650-2
(2004) (Licensee failed to cooperate with the agency’s investigation when she
refused to permit inspection of the licensed premises) (http://www.oah.state.mn.us/aljBase/180015650.rt.htm);
In the Matter of the Indefinite
Suspension of the License of Nicolette Buege, OAH Docket No. 6-1800-15343-2
(2003) ("Ms. Buege declined to discuss the incident at that time and made
no effort to discuss the incident … before this licensing action was
taken") (http://www.oah.state.mn.us/aljBase/180015343.awk.rt.htm);
In the Matter of Jodi K. Brown, L.P.N.,
OAH Docket No. 1-0904-15308-2 (2003) (The Licensee failed to submit to a set of
agreed-upon evaluations) (http://www.oah.state.mn.us/aljBase/090415308.sd.htm).