ROSEMARY PICALLO,		)
				)
Employee,			)	DECISION AND ORDER
Applicant,			)	AWCB Case No. 8301741
				)	AWCB Decision No. 90-0008
v.				)
				)	Filed with AWCB Anchorage
VALDEZ COMMUNITY HOSPITAL,	)	January 17, 1990
				)
Employer,			)
				)
and				)
				)
FIDELITY AND CASUALTY CO.,	)
				)
Insurer,			)
Defendants.			)
				)

This claim for temporary total disability (TTD) benefits, permanent total disability (PTD) benefits, permanent partial disability (PPD) benefits, medical costs, interest, attorney's fees and legal costs and appeal from the Acting Rehabilitation Administrator's (ARA) decision and order of December 12, 1988, was heard on November 3, 1989 in Anchorage, Alaska. The employee was present and represented by attorney Michael J. Jensen. The employer and insurer were represented by attorney Patricia L. Zobel. The record closed on December 12, 1989, the first regularly scheduled hearing day after all briefing had been completed.

Picallo, who is 40 years old and a nurse by profession, has an extensive and complicated history of multiple back and neck injuries and surgeries, beginning in approximately 1971, while she was serving in the U.S. Army Nurse Corps. At that time she pulled some muscles in her back and was treated with bed rest. She was next injured in March 1977 while getting out of a chair. She was initially treated conservatively with bed rest and pelvic traction. When her condition failed to improve, she had her first myelogram and subsequently underwent a discectomy at the L4-5 level. Following this surgery the employee experienced more pain and numbness and tingling into her legs and underwent another myelogram. She was informed that she had some scarring and a possibility of arachnoiditis. During the next several years Picallo had intermittent bouts of back pain and was given a 60 percent service-connected disability because of her back problems.

In August 1978, the employee moved from California to Alaska and started working as a nurse for the Valdez Community Hospital in September 1978. In the summer of 1979, she again injured her back while trying to lift a cardiac arrest patient out of a camper to get him into the emergency room. This was followed by intense pain spreading into her legs, and she was transported from Valdez to Providence Hospital in Anchorage where she remained for one month in traction with bed rest and physical therapy. The employee was off work approximately two months, and when she returned to her nursing assignments she still had some mild back pain but no leg pain and she was able to work unrestricted.

Picallo continued working until she was reinjured on January 9, 1983. At this time she was again trying to lift a patient, and she experienced severe back pain and pain into her abdomen and down her legs. Subsequently, the employee underwent an interbody fusion at the L4-5 level, with laminectomies performed bilaterally. In August 1983, because of persistence of back pain with pain and tingling in her extremities, she was again hospitalized for a repeat myelogram and CT scan. Subsequently, she underwent an L4-5 re-exploration and laminotomy, followed by a bilateral lateral fusion with Knodt rod insertion. In January 1984, the rod was removed and additional bone packing was done. As a result 'of these surgeries, Picallo was off work until February 1 9 8 4 .

In April 1985, the employee underwent an anterior cervical fusion at the C4-5 level and was off work for approximately five weeks.

In February 1986, Picallo again had increased back and neck pain and was readmitted to Providence Hospital and the care of Michael Newman, M.D. At this time a repeat myelogram was attempted but not completed due to scar tissue. She was advised that no further surgical procedures would be of benefit. Dr. Newman referred the employee to Andrew Embrick, M.D., a local practitioner in Valdez. She continued to work until April 1986 when she decided that she could no longer handle the pain from working and went on medical leave. Picallo has not returned to work since that time.

On November 16, 1987, Dr. Embrick released the employee for "self-paced desk work." In May 1988, she moved from Valdez to Chitina, Alaska and to the present lives in a cabin without running water, plumbing or electricity. Chitina is a small isolated community located about 115 miles from Valdez and 250 miles from Anchorage. Also in November 1987, she began seeing Janice M. Kastella, M.D., a neurologist in Anchorage. Dr. Kastella's treatment program involved the prescription of medications.

In may 1988, Dr. Kastella completed a physical capacity evaluation and released Picallo for sedentary employment. Subsequently, Mike Head, a rehabilitation counselor, began working with the employee. Vocational testing was completed followed by a vocational analysis and review of her transferable skills. He had also reviewed the labor markets in Valdez and Chitina. From this information, Head determined that the employee could not return to the nursing field because of her physical restrictions. Her test scores indicated that she could succeed in the clerical field and he began looking for this type of work for her. He found that there were no real job opportunities in Chitina. He also found that while the job market in Valdez was limited because of the economic downturn, there was turnover in the clerical field. Read identified two possible on-the-job training (OJT) sites. The first was with the Valdez School District as an aide. The second was with the Harbor view Developmental Center as a Clerk Typist 11. Read completed a job analysis of both of these positions and sent them to Dr. Kastella for her comments on July 16, 1988.

On August 15, 1988, Head called Picallo and asked her to apply for the teacher's aide job. The last day to apply for this job was August 17, 1988. The employee did not contact the school district or apply for the job because she felt that she would be physically unable to do the job because of pain and needed to discuss the matter with Dr. Kastella.

On August 22, 1988, Dr. Kastella released the employee for both the teacher's aide and the Clerk Typist II positions. Head then contacted Picallo and requested that she set up an appointment to meet with Mary Lou Vanderburg, the clerical supervisor at the Harbor view Development Center because she was willing to provide a six month OJT program to train the employee as a Clerk Typist 11. At the completion of this program, Picallo would be qualified to get on the state register as a Clerk Typist 11 as well as apply for other clerical positions.

On September 22, 1988, Head wrote a vocational rehabilitation services plan. This plan provided for six months of OJT, plus two months of job placement assistance. The OJT was set to begin on October 3, 1988. The employee did not contact Vanderburg for the reasons stated above. On September 29, 1988, Vanderburg signed a statement which stated in part: "I would have been willing to provide on-the-job training program should the employee have completed a successful interview with me."

Because the employee refused to participate in the vocational rehabilitation plan prepared by Head, a formal rehabilitation conference was held on December 5, 1988. On December 12, 1988, the ARA issued a decision and order in which she approved the employer's September 22, 1988 plan and held that the employee had failed to cooperate with the rehabilitation provider from August 23, 1988 forward. (For a complete understanding of factual and legal bases for the ARA's determinations, her decision and order of December 12, 1988 should be consulted).

Picallo was again hospitalized between April 29 and May 8, 1989 complaining that her back felt unstable for ambulation and movement with pain going from her low back up into her neck. She also reported that while her left leg caused her the most pain recently, the right leg felt weaker. She stated that lesser pains had occurred in her mid back below the scapulae which radiated around to the front and in her neck with pain radiating down her arms. The employee also had a sensation of numbness into the thumbs and index finger of each hand, with dysesthesia in that area. Similarly, she had numbness radiating down her right leg. During this hospitalization, a dispute developed between the employee and Dr. Kastella, and Dr. Kastella withdrew as her treating physician.

At the employer's request, Picallo was seen on September 25, 1989, by Walter Ling, M.D., in Los Angeles, California for a neurological and psychiatric evaluation. Dr. Ling is certified by the American Board of Psychiatry and Neurology and has been a clinical associate professor in psychiatry at the University of California at Los Angeles since 1971. On October 4, 1989, Dr. Ling issued a report in which he made both neurologic and psychiatric diagnoses. His neurologic diagnosis consisted of 111) lumbosacral discogenic disease, status post surgery x 3, with secondary arachnoiditis; 2) cervical discogenic disease, status post surgery; 3) chronic pain syndrome, secondary to #1 and 2 above; and 4) probable neurogenic bladder." His psychiatric diagnosis was "1) Axis 1. residual dysthymia (DSM-111-R 300.40, psychological factors affecting physical condition (DSM-III-R 316.00); 2) Axis 11. deferred (DSM-111-R 799.90); and 3) Axis 111. see neurologic diagnoses above. In the commentary portion of his report, Dr. Ling stated:

In her deposition taken on July 12, 1989, Dr. Kastella testified that after studying Picallo's condition in April 1989, she doubted very much that she could ever return to a full-time job doing even the most sedentary activities. However, the doctor did think that the employee was not permanently and totally disabled because she is capable of some sedentary part-time work after a period of work hardening.

At the hearing, Dr. Ling testified that Picallo is not totally disabled, and she is capable of working as a nursing supervisor, school aide and clerk typist. He felt that because it has been so long since she has worked, a re-entry into the work force needs to be gradual. However, the doctor believes that fulltime work is eventually possible. He stated that the employee's back condition has not significantly changed over the past two or three years and is presently stable. Dr. Ling reiterated that for Picallo to become employable it is necessary that she change her attitude and learn to live with some pain and control it instead of letting it control her. He testified that he is familiar with many patients who are not permanently and totally disabled who have had multiple surgeries and arachnoiditis like the employee. Regarding the employee's bladder problem, the doctor thinks that while it should be studied, it does not make her permanently and totally disabled because it could be treated by medication. In conclusion, Dr. Ling stated that the hospitalization and treatment Picallo received in 1989 was reasonable and necessary.

At the hearing, Picallo stated that she still does not think she could have done the jobs suggested by Head in the fall of 1988 because of the pain. She said that she had done similar types of sedentary jobs while she was the nursing supervisor with the employer but had to quit because she could not tolerate the pain any longer. The employee testified that Dr. Kastella's physical capacity evaluation of May 1988 was inaccurate because the doctor had not performed a physical examination of her and had not reviewed any of her medical records. The employee said that while she lives in an isolated area without most modern conveniences, she can manage because she has the help of her two teenage sons and friends. Picallo stated that on a good day she gets up between 8:00 and 9:00 a.m., gets dressed slowly because of stiffness, walks a few miles to the post office in Chitina, visits with friends, walks home, does light housework, rests in a recliner and sometimes does the evening cooking. She said that during a bad period, which may extend two or three days, she is in bed most of the time able only to do occasional light housework. She stated that her two teenage sons do the heavy work like carrying wood and water into the house and do most of the clearing. Finally, she testified that while she would try part-time work if we ordered it, she would not be optimistic that it would be successful. If the employee is ordered to seek employment, she believes she needs training.

Also testifying at the hearing was Mildred Sandvik, a friend of the employee and the employee's teenage son, Tony. Sandvik stated that in 1987 the employee had to move in with her because she was not capable of taking care of herself any longer. This arrangement continued until May 1988 when Picallo moved to Chitina. The employee's son testified that during the past two years he had witnessed how his mother has been able to do less and less because of her pain.

The first question to be resolved is whether the ARA's decision and order of December 12, 1988, should be affirmed or reversed. The record clearly shows that the rehabilitation counselor did a thorough job of evaluating Picallo for potential employment in 1988. He did this by determining her prior work experience, education, and training, by testing the employee to discover her interests and aptitudes and by analyzing the labor market available to the employee. After performing this evaluation, the rehabilitation counselor found two possible sources of employment for Picallo, devised a rehabilitation plan and had that plan approved by Picallo's treating physician. Notwithstanding these efforts, the employee refused to take any steps to carry out, or even initiate the approved plan. Based on these facts and our findings below, we agree with the reasoning and conclusions of the ARA in that decision and order and it is incorporated therein and adopted as the decision and order of this board. Therefore, the ARA's decision and order, which approved the employer's September 22, 1988 vocational rehabilitation plan and held that the employee had failed to cooperate with the rehabilitation provider from August 23, 1988 forward, is affirmed.

The next question that must be determined is whether the employee is entitled to permanent total disability benefits. We find that she is not entitled to such benefits for two distinct reasons.

The first reason is based on the fact that, while Picallo is certainly disabled, she does not suffer a disability which is permanent and total in nature.

The Alaska Workers' Compensation Act (AWCA) defines "disability" as "incapacity because of injury to earn the wages which the employee was receiving at the time of injury in the same or any other employment." (AS 23.30.265(10)). At the time of the employee's injury, AS 23.30.180 provided for PTD benefits at "662/3% of the injured employ" 's average weekly wages . . . during the continuance of the total disability." The AWCA does not, however, define PTD.

An employee need not be completely incapacitated to be entitled to PTD benefits. in J.B. Warrack Co. V. Roan, 418 P.2d 986, 988, (Alaska 1966) the Alaska supreme Court applied the "odd-lot" doctrine. The court stated:

The court further noted in Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska 1974), "The concept of disability compensation rests on the premise that the primary consideration was not medical impairment as such, but rather loss of earning capacity related to that impairment"

We have held that an employee who was unable to return to his former occupation because of his injury may be placed in the odd-lot category. Atkins v. Wick Construction Co., AWC8 No. 860266 (October 9, 1986). in an earlier case, Hewing V. Alaska Workmen's Compensation Board, 512 P.2d 896 at 900 n. 14 (Alaska 1973) the Supreme Court stated:

Professor Larson discusses the burden of proof question in 2 A. Larson, Workmen's Compensation Law §57.61(c), p. 10-178 (1989);

Professor Larson stated further, however, in section 57-61(d), p.10-208:

Based on the principles outlined above by Professor Larson, the first consideration is whether the degree of Picallo's physical impairment, in conjunction with her mental capacity, education, training and age, places her prima facie in the odd-lot category. For the reasons set forth below, we find that the employee has not established a prima facie case that she is only employable on an odd-lot basis.

First, while we are sympathetic to the fact that Picallo has undergone multiple back surgeries over the years and suffers pain as a result of arachnoiditis, the medical evidence demonstrates positively that she is capable of more than casual and intermittent work. Even though the employee, her friend, Sandvik and her son, Tony, all testified that the employee is very limited in what she can physically do and how her condition has gotten progressively worse with time, Drs. Kastella and Ling are of the medical opinion that with proper preparation from a work hardening program, Picallo would be able to do light to sedentary part-time work. When both of these physicians were pointedly asked by counsel if the employee was permanently and totally disabled, both answered unequivocally "no." Dr. Ling testified that Picallo's physical condition is stable and has not changed during the last two or three years. He felt she was presently capable of working as a school aide and clerk typist, the two positions which had been suggested to her since the fall of 1988. In addition, Dr. Ling thought that considering Picallo's education, training and prior experience, she could work as a nursing supervisor in an administrative capacity. Dr. Ling's conclusions were not only based on a thorough review of all of the employee's medical records and a neurological examination, but also on the fact that he was familiar with many patients who have had numerous back surgeries and arachnoiditis like the employee and are not permanently and totally disabled. As noted at some length in his report of October 4, 1989, and during his testimony at the hearing, Dr. Ling strongly believes that the only factor keeping the Picallo from returning to work is her negative attitude. He feels that because the employee believes she has been made to suffer unfairly from chronic back and arachnoiditis, has been betrayed by her medical profession and has tried so hard to work over the years notwithstanding her back condition, that she no longer considers going back to work as a viable option. The doctor testified that this negative attitude toward returning to work, even on a part-time basis, is reflected by the employee's change in life style in moving to an isolated area of the state where no work is available, living on a pension, enjoying the companionship of her two sons and friends and, in essence, living a simpler life. Dr. Ling also noted that when he tried to raise the question of returning to work with Picallo while he was performing his psychiatric evaluation, her entire manner and reaction changed drastically from pleasant and cooperative to one of resistance, open hostility and anger. In this regard, he stated:

Finally, it must be noted that even if the employee suffers from a bladder disorder as a result of her arachnoiditis, Dr. Ling believes that this would not make her permanently and totally disabled because such a condition can be medically treated.

Next, when the other factors outlined by Professor Larson such as mental capacity, education, training and age are considered, it is also apparent that Picallo is riot in the odd-lot category. The testing done by Head revealed that she is intelligent and capable of learning and had an interest in clerical and related work. Regarding education, the record shows that not only has the employee become a registered nurse, hut she has also taken numerous other related courses and seminars during the years she has worked. The record also shows that riot only has Picallo worked and trained as a nurse for the better part of 15 years but she has also worked and trained in an administrative capacity as a supervisor of nursing. Finally, the employee is only 40 years old and, therefore, age would not be a factor in her finding and holding a job.

Having determined that Picallo's medical impairment is limited and specialized in nature and she is not obviously unemployable or relegated to the odd-lot category, the burden of proof is placed on her to establish that work is unavailable to her in her circumstances, which normally requires a showing that she has made reasonable efforts to secure suitable employment. The employee has obviously failed to carry her burden of proof in this regard because no evidence was introduced to show that work has been unavailable to her for any period since she stopped working in 1986. She even testified that she has not made any efforts to secure suitable employment since that time. In addition, it should be noted that even when possible suitable jobs were found for Picallo in the fall of 1988, and an eight month OJT plan was proposed to train her in the clerical field, she refused to even consider them.

Based on these findings, we conclude that the employee is not permanently and totally disabled and, accordingly, head claim for PTD benefits must be denied.

The second reason for denying the employee's claim for PTD benefits is that she forfeited all disability compensation after August 23, 1988, when she refused to even consider working as a school aide or a clerk typist; two positions found by Head and approved by her treating physician, Dr. Kastella.

The version of AS 23.30.041(h) which existed when Picallo was injured in 1983, provided, in pertinent part;

As noted above, we have reviewed the evidence submitted to the ARA regarding the cooperation issue and affirmed her determination that the employee had failed to cooperate with the rehabilitation provider from August 23, 1988 until the ARA's decision was issued on December 12, 1988. in addition, we have found that the employee, while not permanently and totally disabled up to the present time, has refused to even consider any type of employment. This finding is supported by Dr. Ling's report and testimony at the hearing. Accordingly, the employee is not entitled to PTD benefits du-ring the period in question.

Next, Picallo claims she is entitled to PPD benefits from the time she refused to consider the school aide and clerk typist jobs in August 1988 until the present. Again we must deny the employee's claim for two distinct reasons.

First, Picallo has not submitted any evidence to prove that she is entitled to PPD benefits.

At the time Picallo was injured in 1983, compensation for PPD benefits was provided for in AS 23.30.190 (a) (20) which stated in pertinent part:

As noted in our previous discussion regarding permanent and total disability, our Supreme Court has emphasized that disability compensation is a function of lost earning capacity and not medical impairment as such. Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska 1974). Regarding the determination of wage-earning capacity, AS 23.30.210 provided in 1983:

Our Supreme Court has held that "other factors" include age, education, availability of suitable employment in the community, the employee's future employment intentions, train ability, and vocational rehabilitation assessment and training. Bignell v. Wise Mechanical Contractors, 651 P.2d 1163, 1167 (Alaska 1982) ; Hewing v. Peter Kiewit and Sons, 586 P. 2d 182, 186 (Alaska 1978) ; Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska1974); Hewing v. Alaska Workmen's Compensation Board, 512 P.2d 896, 899 (Alaska 1973).

In Brunke v. Rogers and Babler, 714 P.2d 795 (Alaska 1986), our Supreme Court held that an employee has the burden of proving loss of wage-earning capacity for purposes of determining his or her PPD benefits for an unscheduled injury. The court concluded as follows:

While it is acknowledged that Picallo suffers from a physical impairment, she did not introduce any evidence which would allow us to fix her post-injury wage-earning capacity. While there is evidence in the record that the employee could have worked as a high school aide or clerk typist, the record does not indicate what those jobs paid. Without such information, we are not able to ascertain what the employee could have earned during her period of disability. Accordingly, we must deny her claim for PPD disability benefits.

The second reason for denying the employee's claim for PPD benefits, is that by failing to even consider the two possible jobs that Head found for her in August 1988 and having no intentions since then to become employed, she forfeited any disability compensation that she might have been entitled to pursuant to AS 23.30.041(h). Since this matter has been discussed above in our consideration of Picallo's claim for PTD benefits, nothing further needs to be said at this point. In support of her contention that she is entitled to PPD benefits, the employee cites the case of Jette v. State of Alaska, AWCB No. 890067 (March 14, 1989). While in that case the board did hold that an employee who had refused to take a modified job was still entitled to PPD benefits, we find it distinguishable from Picallo's case because in Jette forfeiture under AS 23.30.041(h) was never raised as a issue. The only issue before the board in Jette was whether suitable gainful employment had been found for the employee.

The employee also contends that she is entitled to TTD benefits from January 1989 until a rehabilitation plan is devised to get her back to work at a wage that approaches her prior wage of approximately $40,000 a year. we disagree. The evidence shows that the employer did what was required of it when Picallo's treating physician released her for modified work by providing a rehabilitation counselor who, in turn, devised an appropriate rehabilitation plan for her. Since Picallo refused to cooperate with that plan and has continued to maintain her attitude that she was not capable of any work up until the present time, she has again forfeited any disability compensation pursuant to AS 23.30.041(h).

Picallo next claims that the employer should pay for the medical expenses she incurred in April and May 1989. The record reflects that the employee owes Humana Hospital Emergency Room $36.00, the Humana Hospital $7,023.00 and Dr. Kastella $475,00. Since both Drs. Kastella and Ling testified that it was reasonable and necessary for the employee to incur these expenses and the defendants have not objected to them, we find that the defendants should pay these medical expenses. In conjunction with this claim for medical costs, Picallo also claims that she is entitled to TTD benefits for the time she was in the hospital in April and May 1989. Since we have found that is was reasonable and necessary for the employee to be in the hospital, it follows that she could not have worked at that time and, therefore she is entitled to TTD benefits as claimed. Accordingly, the defendants shall pay the employee TTD benefits for the time she was in the hospital during April and May 1989.

Next, the employee claims the defendants should pay interest on all benefits awarded. In Land & Marine Rental Company v. Rawls, 686 P.2d 1187, 1192 (Alaska 1984), the Supreme Court held "a workers' compensation award, or any part thereof, shall accrue lawful interest . . . from the date it should have been paid." Recently, in Moritz v. O'Neill Investigations, P.2d , at 7-8 (Sup. Ct. Op. No. 3535, December 8, 1989), our Supreme Court stated:

Based on these holding by our Supreme Court, we find that the employee is entitled to interest on those TTD benefits and medical expenses we have awarded.

Finally, Picallo claims she is entitled to attorney's fees and costs. Regarding attorney's fees her attorney requested minimum statutory fees pursuant to As 23.30.145(a), while reserving his right to actual fees at some future date. Since the employee employed an attorney to successfully prosecute a portion of her claim, we find that she is entitled to minimum statutory attorney's fees at this time. Regarding costs, we find nothing in the record which documents any amount claimed. Accordingly, we direct the employee to submit a cost statement to the defendants. We retain jurisdiction over this matter if a dispute arises between the parties.

1. The employee's claim for PTD benefits is denied and dismissed.

2. The employee's claim for PPD benefits is denied and dismissed.

3. The employee's claim for TTD benefits is denied and dismissed except as noted in number 5 below.

4. The defendants shall pay Humana Hospital Emergency ROOM $36.00, Humana Hospital $7,023.00, and Dr. Kastella $475.00.

5. The defendants shall pay the employee TTD benefits for the period she was hospitalized in April and May 1989.

6. The defendants shall pay the employee interest on the TTD benefits and medical expenses awarded.

7. The defendants shall pay the employee minimum statutory attorney's fees pursuant to AS 23.30.145(a).

Dated at Anchorage, Alaska, this 17th day of January 1990.

ALASKA WORKERS' COMPENSATION BOARD

/s/ Russell E. Mulder
Russell E. Mulder, Designated Chairman

/s/ D.F. Smith
Darrell F. Smith, Member

REM/jw

If compensation is payable under terms of this decision, it is due on the date of issue and penalty of 20 percent will accrue if not paid within 14 days of the due date unless an interlocutory order staying payment is obtained in Superior Court.

APPEAL PROCEDURES

A compensation order may be appealed through proceedings in Superior Court brought by a party in interest against the Board and all other parties to the proceedings before the Board, as provided in the Rules of Appellate Procedure of the State of Alaska.

A compensation order becomes effective when filed in the office of the Board, and unless proceedings to appeal it are instituted, it becomes final on the 31st day after it is filed.

CERTIFICATION

I hereby certify that the foregoing is a full, true and correct copy of the Decision and order in the matter of Rosemary Picallo, employee/applicant; v. Valdez Community Hospital, employer; and Fidelity and Casualty Co., insurer/defendants; Case No. 8301741; dated and filed in the office of the Alaska Workers' Compensation Board in Anchorage, Alaska, this 17th day of January 1990.

Jamie Whitt, Clerk

SNO