KATHIE A. SUPER,		)
				)
Employee,			)	DECISION AND ORDER
 Respondent,			)
				)	AWCB Case No. 8909879
v.				)
				)	AWCB Decision No. 90-0042
PROVIDENCE HOSPITAL,		)
				)	Filed with AWCB Anchorage
Employer,			)	March 12, 1990
				)
and				)
				)
AETNA CASUALTY & SURETY CO.,	)
				)
Insurer,			)
 Petitioners.			)
				)

We heard this matter on February 7, 1990. Employer and Insurer (Employer), represented by attorney James Pentlarge, request review of the December 29, 1989 rehabilitation eligibility decision of Douglas Saltzman, Reemployment Benefits Administrator (RBA). Employee did not attend the hearing but was represented there by attorney William Erwin who substituted for attorney Jaime Hidalgo, her attorney of record. The record for this matter closed on February 7, 1990.

1. Under AS 23.30.041(d), should the RBA's decision be upheld?

2. Should witnesses be allowed to testify at the review hearing?

3. Should we grant a modification hearing under AS 23.30.130 for mistake of fact or change of condition?

Under AS 23.30.041(d), we are bound, in our review, to uphold the RBA's eligibility decision except for abuse of discretion. As we point out below, we believe our review is limited to the written record available to the RBA when he made the eligibility decision. The following facts are part of that written record.

There is no current dispute Employee sustained a low back strain while lifting a patient during her employment at Providence Hospital (Employer) in Anchorage. She began receiving weekly temporary total disability (TTD) benefits of $228.61. Employer paid these benefits from April 30, 1989 to June 2, 1989 and from July 24, 1989 to September 24, 1989.

Employee was given a seven percent permanent impairment of the whole person by her physician, Michael James, M.D. (James September 25, 1989 report). In his report, Dr. James declared Employee medically stable, and he stated: "With regard to return to work, I believe this lady is best served by seeking something of a light medium duty work within the nursing profession. Lifting heavy patients is probably not in her or the hospitals best interest. Dr. James released Employee for modified work. On October 10, 1989 Employer paid Employee $9,450 ($135,000 x 7 percent) for permanent partial impairment (PPI) benefits.

Meanwhile, rehabilitation activity had begun on July 5, 1989 when Douglas Saltzman, Reemployment Benefits Administrator (RBA) responded to Employee's request for reemployment benefits by notifying her that an eligibility evaluation under AS 23.30.041 could not be undertaken until Employee submitted supporting medical documentation. The written record indicates that no further rehabilitation activity occurred until October 1989.

Employer decided to hire Northern Rehabilitation Services (NRS) to provide them with rehabilitation information. On October 10, 1989 NRS sent Employee a written request to contact them for "rehabilitation planning."

On October 23, 1989 Employee's attorney (Hidalgo) filed a request for an eligibility evaluation based on Dr. James’ September 25, 1989 report. (Hidalgo October 13, 1989 letter). On October 26, 1989 Saltzman notified Employee he had selected rehabilitation specialist Linda Lau of Crawford Rehabilitation to perform Employee's eligibility evaluation. (Saltzman October 26, 1989 letter). In this letter, Saltzman also stated:

In addition, Saltzman instructed Employee to call Lau if Lau had not contacted her within five days.

On November 7, 1989 Dennis Johnson, Branch Manager of Crawford Health and Rehabilitation (Crawford), and Lau's supervisor, wrote Employee and informed her Crawford had attempted to call her but discovered her phone was no longer in service. He added that his firm had been informed Employee's case was in the process of being resolved and that she may no longer be interested in a rehabilitation evaluation. He asked Employee to indicate, at the bottom of his letter, whether she was still interested in services and to return the letter to Crawford.

On November 20, 1989 Curtis Nelson, claims representative for Insurer notified Saltzman and Lau that Employee and Employer had settled Employee's claim via compromise and release (C&R). (Nelson November 15, 1989 letter). Nelson disclosed that in the C&R, Employee agreed to waive her right to rehabilitation benefits. Further, Nelson asserted there were jobs in the labor market "which would fit Ms. Super's medical restrictions," and she would not "appear to be eligible for vocational rehabilitation benefits."

On November 21, 1989 specialist Lau wrote Saltzman stating she was returning the rehabilitation referral on Employee because Employee had not responded to their attempted contacts. In addition, Lau reported that insurer and employee's attorney indicated Employee did not want rehabilitation and had relocated out-of-state. (Lau letter filed November November 27, 1989).

Saltzman wrote Lau on November 22, 1989 indicating Johnson had told Saltzman the original referral on Employee had been sent to Crawford's insurance division instead of the rehabilitation division. Saltzman thereupon granted Lau an additional 14 days to complete the eligibility referral, based on a "lost in the mail referral." (Saltzman November 22, 1989 letter at 2).

Saltzman also expressed his frustration that although Lau had been assigned to do Employee's evaluation, Saltzman's only discussions had been with Johnson, Lau's supervisor. Saltzman stated that "to my knowledge you are not even aware you have a referral. He also stated he found "it hard to comprehend why contact . . . cannot be made" with Employee or "written evidence produced as to her intentions." (Id. at 1). Saltzman concluded that he looked forward to getting either a completed evaluation or notification of Employee's withdrawal from rehabilitation. Meanwhile, on November 27, 1989 Employee signed the bottom of Crawford's November 7, 1989 letter and indicated she was still interested in a rehabilitation evaluation.

On November 28, 1989 the parties filed a C&R agreement. The C&R indicates Northern Rehabilitation Services (NRS) provided rehabilitation services and found Employee "possessed skills sufficient to return to work in a modified or alternative" position with Employer, (C&R at 3) The C&R goes on to state that NRS accordingly discontinued services and wrote a closure report on October 31, 1989.

On December 4, 1989 the Board disapproved the C&R. In its notice to the parties, the Board requested that it be provided with a copy of NRS's October 31, 1989 closure report.

On December 8, 1989 Lau wrote Saltzman and requested additional time to complete the eligibility evaluation on Employee based on Employee's delay in deciding whether to proceed with rehabilitation. On December 18, 1989 Saltzman granted her request, indicating the evaluation was due Sunday, December 24, 1989. Saltzman cautioned Lau that no other extensions were possible.

On December 22, 1989 Lau filed her eligibility evaluation report. (Lau December 21, 1989 report). We summarize and quote at length from this report since it was the basis for the RBA's eligibility decision.

Lau interviewed Employee and found that Employee had worked as a licensed practical nurse (LPN) for Employer since 1978. In addition, Employee obtained a General Arts Associate's degree from the University of Alaska Anchorage (UAA) in August 1989. Lau's report reflects Employee was then currently enrolled at Alaska Pacific University (APU) and was scheduled to graduate in May 1990 with a degree in Organizational Administration. (Lau December 21, 1989 report at 2).

Lau's report indicates that on December 7, 1989 Lau contacted Maggie Kalbrenner, who worked in Employer's personnel department, regarding "positions available with less physical requirements than LPN." (Id.). Kalbrenner stated there were positions available at that time, including records analyst, inventory control clerk, sterile processing technician, and medical records clerk. No wage data, for these positions, were provided in Lau's report. Lau went on to state:

. . . .

(Id. at 3).

Lau concluded:

(Id. at 4).

On December 29, 1989 the RBA notified the parties that he found Employee eligible for reemployment benefits based on Lau’s evaluation. (Saltzman December 29, 1989 letter). In this letter, he stated in part:

On January 5, 1990 Employer's attorney, James Pentlarge filed a notice stating Employer continued to contend Employee was not eligible for rehabilitation services based on Dr. James' September 29, 1989 report and the report of Northern Rehabilitation Services (NRS). In the letter, Employer asserted that although Dr. James "apparently" did not approve the job analysis (JA) of licensed practical nurse, the JA fits within the restrictions Dr. James outlined in his September 25, 1989 report.

The NRS report was also submitted on January 5, 1990. Our review of the file indicates this was the first filing of the NRS report. Employer's timely appeal followed the filing of these documents.

I. Testimony at the hearing on abuse of discretion

Employer presented several arguments at the February 7, 1990 hearing. As a preliminary matter, Employer requested that it be allowed to present testimony of two witnesses who, it believed, could "make clear" that the Reemployment Benefits Administrator (RBA) erred in his eligibility determination. As an offer of proof, Employer submitted the affidavits of two of its employees who work in Employer's personnel department.

Employer added that it should have the opportunity to present evidence because the board has no way of knowing how the RBA arrived at his decision since there was no written opinion on the eligibility decision. Employer further contends it had no opportunity to submit evidence or testimony before the RBA, and fairness and due process require that the board now allow the presentation of evidence and testimony.

Employee countered that in previous reviews of RBA decisions, the board's policy has been to base its review on the written record and the parties' oral arguments at hearing. As such, Employee objected to Employer's offers of proof and stated she would "stipulate to nothing."

AS 23.30,041(d) provides in pertinent part that "either party may seek review" of the RBA's eligibility decision "by requesting a hearing under AS 23.30.110 . . . The board shall uphold the decision of the administrator except for Abuse of discretion on the administrator's part." In several prior decisions, we have found no basis for permitting a party to introduce evidence at the review hearing which had not been presented to the RBA. See, e.g., Sullivan v. Gudenau and Co., AWCB No. 89-0153 (June 16, 1989); Garrett v. Halliburton Services, AWCB No. 89-0013 (January 20, 1989); and McCullough v. S & S Welding, Inc., AWCB No. 88-0333 December 7, 1988). Consistent with these decisions, we denied Employer's request to introduce additional evidence at hearing.

As mentioned at the outset of this decision, we are bound to uphold the RBA's eligibility decision except when we find abuse of his discretion. In these RBA reviews, we apply the abuse of discretion standard as it has been defined by the Alaska Supreme Court. In Sheehan v. University of Alaska, 700 P.2d 1295, 1297 (Alaska 1985), the court stated: "This court has explained abuse of discretion as 'issuing a decision which is arbitrary, capricious, manifestly unreasonable, or which stems from an improper motive.' [footnote omitted] Tobeluk v. Lind, 589 P.2d 873, 878 (Alaska 1979)." Misapplication of the law and a failure to exercise sound, reasonable, and legal discretion also fall within the common definition of "abuse of discretion." Black’s Law Dictionary 10 (Fifth Edition 1979).

We reiterate that in reviewing the RBA's decision for abuse of discretion under AS 23.30.041(d), we should not take additional evidence into the record. Although subsection 041(d) states that a party may seek review by requesting a hearing under AS 23.30.110, a section which permits the taking of evidence and cross-examination at hearing, this panel finds that it would be unfair to the RBA, and inappropriate for the board, to review the RBA's decision using evidence that was not presented to the RBA. Such a procedure would vitiate a proper review for abuse of discretion and would result in a de novo hearing, a process apparently not contemplated by the Alaska Legislature when it amended section 041 in 1988.

Employer suggests that due process requires that at some point in the process, Employer must be allowed to present evidence. We find that the RBA gave Employer and Employee the opportunity to present evidence and comment when he notified the parties in his October 26, 1989 letter that they had ten days after receipt of the rehabilitation specialist's report "to file any additional evidence or comment on the evaluation . . . ." Since the RBA received the eligibility specialist's report on December 22, 1989 and made his decision on December 29, 1989, he clearly did not give the parties the time contemplated in his October 26, 1989 letter. Moreover, the time allotted by the RBA for the filing of this additional evidence and comment is somewhat ambiguous. Nonetheless, no comment or evidence was filed by Employer until January 5, 1990 which appears to be beyond the ten day time the RBA intended to allow for additional evidence.

In any case, whatever error the RBA may have committed (in not giving ten days to file evidence) was harmless because nothing in section 041 requires the RBA to allow the parties an opportunity to present this additional evidence or comment. In fact, subsection 041(d) does not require the RBA to wait for any period before notifying the parties of his decision. Even so, the RBA provided an opportunity for comment. Accordingly, we find no basis, under Employer's argument, for taking additional testimony or evidence. We conclude that this added evidence would be irrelevant to our review for abuse of discretion. Employer's request to present the testimony of two witnesses is therefore denied.

II. Review for abuse of discretion

We next decide whether, under AS 23.30.041(d), the RBA abused his discretion. Employer suggests that there was an abuse by the RBA based on the record existing when he made the eligibility decision. Employer disputes the RBA’s statement that Employer had not made an offer of alternative employment to Employee. While admitting it did not make a written offer, it asserts it made an implied offer with the only prerequisite being that Employee merely needed to fill out a written job application. Employer contends it was in a "catch 22" and made no formal job offer because a settlement offer was pending and Employee had moved out-of-state. Further, Employer argues Employee failed to cooperate by not completing a job application. Employer contends that Employee should be required to comply with this simple administrative requirement, as long as it is reasonable, in order to be eligible for rehabilitation benefits.

We now consider these arguments in the context of the record available to the RBA. The RBA based his decision on the rehabilitation specialist's report, and he emphasized that 1) Employee's physician predicted she could not return to work as an LPN, and 2) Employer did not make a written offer of employment indicating the wages and physical capacities required of this alternative employment.

AS 23.30.041(e) states that an employee is eligible for reemployment benefits if a physician predicts the employee will have permanent physical capacities less than the physical demands of jobs Employee held when injured or in the ten years before the injury. Employee's only job in the ten years up to and including her injury was licensed practical nurse (LPN). The RBA relied on Dr. James' December 5, 1989 opinion that Employee's permanent physical capacities were less than those required of an LPN. Although this opinion may conflict with Dr. James' September 25, 1989 opinion, we find it was reasonable for the RBA to rely on the December 1989 opinion. We conclude he did not abuse his discretion in relying on this report.

Regarding the "implied" job offer, AS 23.30.041(f)(1) states that an employee is ineligible for reemployment benefits if

AS 23.30.041(f)(1).

Referring again to the rehabilitation specialist's report, it states there were four "positions open" but that Employee would need to apply for each position before She would be offered employment. (Lau December 21, 1989 report at 3). The report goes on to state that Employee did apply for these positions, and rehabilitation specialist Lau sent Employer's personnel department, specifically Ms. Kalbrenner, a letter "requesting written confirmation of a suitable job offer meeting the wage criteria." (Id.).

Although Employer argued at hearing that it was then "ready, willing and able" to offer Employee employment, no such offer existed when the RBA made his eligibility decision. Furthermore, the parties never submitted information on wages of Employer's "open positions." In addition, there is no other document, filed by December 29, 1989 or anytime afterwards, which addresses or otherwise indicates Employer may have fulfilled the requirements of AS 23.30.041(f)(1). Therefore, Employer's assertion is without merit, and we find the RBA did not abuse his discretion in relying on Lau's report and in finding no job offer existed as of December 29, 1989.

Employer asserts the RBA abused his discretion by failing to notify Employer so it could make a clear job offer to Employee. We find nothing in the statute that requires the RBA to notify an employer that it needs to submit its job offer in writing.

The new rehabilitation amendments, effective July 1, 1988 have put the RBA under significant time constraints to riot only get rehabilitation reports done but also make his eligibility decisions soon after getting the reports. To comply with these limits, he would not have the time to notify employers that their job offer is not valid because it is unclear. He must decide eligibility based on the documents in the file.

At hearing, Employer asked us to "state that it's reasonable for an employer to have administrative requirements as long as they are reasonable administrative requirements, in the course of offering an employee employment under section 041(f)." At the risk of being repetitious, our duty is to review the RBA's eligibility decision for abuse of discretion under AS 23.30.041(d). We do not find it appropriate, in our review, to address Employer's request. Our focus must remain on the RBA and what he did here. Although Employer's concern may very well be legitimate, it should probably be addressed to the RBA.

In this case, we find it reasonable that the RBA would require a written job offer under AS 23.30.041(f)(1). A written offer could clear up ambiguities in the written record. In any event, even if we were to find an offer was made here, no wage criteria was filed. We conclude that the RBA's interpretation that AS 23.30.041(f)(1) requires job offers to be in writing is reasonable and therefore not an abuse of his discretion.

Finally, Employer contends that the RBA abused his discretion by having ex parte contact with Employee's attorney. Employer argues that as a result of this meeting, Employee changed her mind and thus decided to pursue her request for rehabilitation benefits. We find no evidence in the record that indicates such a meeting occurred. Therefore, there is no evidence that as a result of such a meeting, the RBA's decision was somehow arbitrary, capricious or manifestly unjust. Accordingly, we find no abuse of discretion.

III. Review of the RBA's decision under As 23.30.130

Finally, Employer requests alternatively that we reverse and remand this matter for mistake of fact and change of condition under AS 23.30.130. Employer contends the RBA was mistaken in concluding no job offer was made. In addition, Employer asserts we should "reverse and remand" the RBA's decision for change of condition because Employer is ready, willing and able to offer Employee a job.

At the outset, this panel does not believe that section 130 was designed to address alleged mistakes by the RBA. Subsection 130 provides for modification proceedings for mistakes in the board's determination of a fact, not the RBA's rehabilitation eligibility decision which clearly does not contain findings or determinations of fact. We find it would be an unreasonable statutory stretch to allow use of section 130 for this purpose. We have repeatedly stated here that our duty is to review for abuse of discretion. This standard includes a review to determine if the RBA was "clearly mistaken." We find it would he redundant to review the RBA's eligibility decision for clear mistakes, and then to allow a section 130 modification hearing for mistakes of fact. Therefore, we conclude section 130 is an inappropriate procedural avenue to determine whether the RBA was mistaken.

In addition, we question whether section 130 should be used to cure changes occurring after the RBA decides an employee's eligibility for rehabilitation benefits. Section 130 addresses modification by the "board". We do not believe it would be appropriate to include the RBA (whom the board appoints) within the context of the "board" under section 130. We note that the Legislature amended section 130 effective July 1988. It could have, but did not choose to connect 041 matters to section 130 modifications.

Employer argues a modification hearing must be allowed because up to this point it has not been given the opportunity to present evidence or witnesses as allowed under both 110 and 130. We have already stated that Employer was given the opportunity to comment and submit documentation to the RBA.

There does not appear to be a specific procedure in section 041 to deal with changes of condition. Because changes often occur, there needs to be a mechanism to deal with them. However, we believe it is more appropriate for parties in a rehabilitation setting to address these changes directly to the RBA.

In any event, we refuse to "reverse" the RBA's decision and remand it under section 130. Even if we decided 130 could somehow apply to RBA settings, Employer has not filed a petition for a rehearing as required by 8 AAC 45.150(b). Employer's request is denied.

1. Employer's request that it be allowed to present witnesses at the hearing for review of the eligibility decision of the Reemployment Benefits Administrator is denied.

2. Employer's request that we reverse and remand this case to the Reemployment Benefits Administrator under AS 23.30.130 is denied.

3. The reemployment benefits administrator did not abuse his discretion in his December 29, 1989 rehabilitation eligibility decision.

Dated at Anchorage, Alaska, this 12th day of March, 1990.

ALASKA WORKERS' COMPENSATION BOARD

/s/ MR Torgerson
Mark R. Torgerson, Designated Chairman

/s/ RL Whitbeck Sr
Richard L. Whitbeck, Member

MRT:fm

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 Kathie A. Super, employee/applicant; v. Providence Hospital, employer; and Aetna Casualty & Surety Co., insurer/defendants; Case No. 8909879; dated and filed in the office of the Alaska Workers' Compensation Board in Anchorage, Alaska, this 12th day of March, 1990.

Clerk

SNO