P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)






Claim Nos. 89076062 and 93004526

An administrative law judge (ALJ) for the Worker's Compensation Division of the Department of Workforce Development (Department of Industry, Labor and Human Relations prior to July 1, 1996) issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and order in that decision as its own.


The findings and order of the administrative law judge are affirmed.

Dated and mailed July 30, 1996
bombean.wsd : 101 : 0  ND 8.45

Pamela I. Anderson, Chairman

Richard T. Kreul, Commissioner

David B. Falstad, Commissioner


The underlying facts as found by the ALJ may be briefly summarized for the purposes of discussion. The applicant sustained a back injury as the result of a work-related car accident in December 1989. She was treated conservatively, and her condition improved, but she was left with permanent partial disability compared to disability to the body as a whole. She sustained temporary flare-ups of back pain in March 1991 and April 1992 while moving x-ray equipment or patients, but these evidently resolved. She sustained another injury on January 18, 1993. Her testimony is that the treatments which helped her recover from the 1991 and 1992 flare-ups did not help in 1993. She ultimately underwent a fusion surgery in November 1993.

The main issue here is whether her employer at the time of the December 1989 injury (MML Health) or at the time of the 1993 injury (St. Mary's) has to pay for the fusion surgery, resulting temporary disability and additional permanent partial disability. The ALJ's decision holds MML Health liable, and MML Health appeals. A second issue, raised by the applicant in its response to MML Health's petition, is that the ALJ should have made deductions from the "cushion" in a different order.

a. Which employer liable?

MML Health contends that Dr. Pollack's opinion that this case poses a "Lewellyn 3" (1) situation is most credible. Essentially, MML Health asserts that the January 1993 work injury precipitated, aggravated, and accelerated the applicant's pre-existing degenerative condition from the December 1989 car accident beyond its normal progression. In support of its position, MML notes: (1) the applicant's symptoms got noticeably worse after the January 1993 injury, involving the right leg for the first time; (2) she had recovered from two other temporary aggravations in the past; and (3) Dr. Flesch's opinion that the December 1989 injury was a material contributory factor does not mean the January 1993 injury could not have aggravated, accelerated and precipitated the applicant's condition after the January 1989 injury beyond its normal progression.

However, after carefully considering the record, the commission concluded the ALJ correctly determined the November 1993 surgical procedure and the applicant's associated disability were caused by the December 1989 injury at MML Health rather than the January 1993 injury at St. Mary's. The commission adopts the analysis set out by the ALJ at length in her decision.

In addition, the commission notes treating surgeon Cain's expert opinion that the December 1989 work injury caused a disc protrusion and that the protrusion eventually caused the need for surgery. Dr. Cain noted that the 1991 myelographic CT scan showed a subtle involvement of the left L5 nerve root. He also noted that the 1990 MRI showed disc protrusion at L4-5 and L5-S1, as did the March 1993 MRI. The doctor's deposition indicates he attributed the November 1993 fusion surgery to the December 1989 work injury rather than the January 1993 work injury because the protrusion and subtle impingement were already apparent in the imaging tests done in 1990 and 1991.

A different result might arise if another medical doctor had acknowledged the impingement shown in the 1991 CT scan and opined the 1993 injury made it worse. Or a different result might arise if another doctor had said that Dr. Cain was wrong, and that the 1991 CT scan did not show a disc protrusion causing nerve impingement. Absent that type of expert opinion, though, the commission declines to disturb the ALJ's well-reasoned findings on this issue.

b. Cushion.

A "cushion" is the amount protected from a settlement from a third party in a work injury, to use to offset the employer's liability. See sec. 102.29 (1), Stats. In this case, for example, the MML Health is liable under the worker's compensation law for the 1989 car accident, even though the negligence of the other driver in failing to yield the right of way apparently caused the accident. Under sec. 102.29, Stats., a portion of the settlement the applicant got from the other driver in the 1989 car accident must be held to "cushion" MML Health's liability.

In this case, the "cushion" from the applicant's settlement with the driver of the other car in her 1989 accident is about $24,836.07, per order of Milwaukee County Circuit Judge Michael Skwierawski. Under ALJ Schneiders's order, MML Health's liability for disability compensation and medical expenses is $42,443,92. Of this, $11,999.07 was for temporary disability benefits, $6,250 for permanent partial disability benefits and $24,194.85 for medical expenses. The medical expenses included $2,835 to St. Mary's Anesthesia for services rendered, $208 to Aetna in reimbursement for payment to a provider, $20,836.85 to Comp Care in reimbursement for payments to providers, and $315 to the applicant in reimbursement for out-of-pocket medical expenses.

The ALJ deducted the sum of disability awards ($18,249.07) from the cushion first, leaving the difference of $6,587 to cover medical expenses. From the remaining $6,587, the ALJ then directed reimbursement first to the applicant for $315 in out-of- pocket medical costs, leaving a remainder $6,272 in the cushion. She then ordered MML Health's insurer to pay CompCare directly the difference between the total due it and the remainder of the cushion, or $14,564.85. Presumably, the remaining amount due CompCare will come from the cushion. The ALJ also ordered MML Health's insurer to pay the remaining sums due St. Mary's Anesthesia and Aetna directly.

The applicant wants the amounts deducted from the cushion in the chronological order in which they became due, with the result that medical expenses would be largely deducted before the amounts paid in disability compensation. At first glance, it is not apparent why the applicant cares about the order in which payments are made from the cushion. The amount the applicant receives in disability is the same, $18,249.07, regardless of whether it comes from the insurer directly or the "cushion." And the cushion would be exhausted either way, as MML Health's liability exceeds the amount in the cushion regardless of who is paid first.

However, the record indicates that the applicant currently is in possession of the "cushion." The commission assumes that she believes she can settle the medical expenses for less than the amounts outstanding. If she gets a credit against the cushion for the full amount of the medical expenses, but settles those expenses for less, she would reap a financial advantage. The insurer evidently also feels it can settle the medical expenses for less than the amount outstanding. At least, the commission assumes this is the motivation of the parties in this case.

The commission is not aware of any authority dealing with the issue of the order in which items should be deducted from a cushion. Between the insurer and the applicant, though, the equities are with the insurer. If the commission were to modify the ALJ's order as the applicant requests, MML Health's insurer would give up nearly the full $24,194.85 in medical expenses from the cushion, even though the applicant might eventually settle those expenses from the cushion for less. If the insurer is liable for medical expenses, it should have the opportunity to get the benefit of adjustment of those expenses.




[ Search WC Decisions ] - [ WC Legal Resources ] - [ LIRC Home Page ]


(1)( Back ) See Lewellyn v. DILHR, 38 Wis. 2d 43, 58-59 (1968).