LALIA G. HOSCHAR, 
Employee, 
Applicant
v. 
MIDTOWN DAY CARE CENTER, INC,
Employer,
and 
ALASKA NATIONAL INS. CO. ,
Insurer,
Defendants.

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DECISION AND ORDER
AWCB Case No. 199604426
AWCB Decision No. 99-0261
Filed with AWCB Anchorage, Alaska
on December 30, 1999

We heard the employee's claim for permanent total disability benefits (PTD) on the written record when we met in Anchorage, Alaska on December 12, 1999. Attorney William Erwin represents the employee. Attorney Trena Heikes represents the employer. We closed the record at the time of our deliberations.

Is the employee permanently totally disabled?

The employee twisted and injured her low back on March 6, 1996 when in the course of her employment for the employer. Thereafter, she went to the emergency room with acute right sciatica pain, where she was diagnosed with disk degeneration at L3-4 with compression of the intervertebral space. (See Emergency Room Report dated March 9, 1996.) She returned to the emergency room on March 12, 1996 complaining of pain and was referred to Edward Brown, M.D., for treatment. She also filed a report of Occupational Injury or Illness form on March 12, 1996.

The employee was 64 years of age at he time of this injury. She has an eighth grade education and has had nine children. She is a widow and lives alone. She had worked for this employer for approximately 7 years before this injury.

In August of 1990, the employee had suffered a fall while tying a child’s shoe at work. She had extensive conservative care from W. Risch, D.C. X-rays taken July 31, 1991 revealed the employee had spinal stenosis and narrowed foramina at the L3-L4 and L4-L5 levels of the lumbar spine. On November 4, 1991, Shawn Hadley, M.D., rated the employee with a 7% permanent partially impairment (PPI) under the American Medical Association Guides to Valuation of Permanent Impairment (AMA Guides), 3^rd Edition. The employee was paid for the 7% PPI rating. Although she was advised to take only light duty jobs, the employee returned to full employment with the same employer and did well until her March 1996 injury. (See, Dr. Hadley’s Report dated March 31, 1997.)

The employee has hypertension for which she takes medication and has an abdominal aortic aneurysm. Magnetic resonance imaging (MRI) testing of the employee’s condition performed March 21, 1996 showed evidence of changes in this aneurysm.

Evaluation of the employee’s condition by Declan Nolan, M.D., and Leslie Glasgow, M.D., indicated she was not a candidate for surgery, and she was referred to Michael James, M.D., for further evaluation and treatment. On April 22, 1996, Dr. James agreed the employee was not a surgical candidate, and on August 7, 1996 Dr. James evaluated the employee for a PPI rating. He also concluded: "I believe the patient has incurred a permanent impairment rating as a consequence of her injury of March 6, 1996."

Additionally, using the AMA Guides, 4^th Edition, Dr. James found:

In reviewing the AMA Guidelines and where this patient falls into the Guidelines, I believe she is best described by DRE lumbosacral category VI, which is "cauda equina-like syndrome without bowel or bladder signs." This is a 40% impairment of the whole person. This is on the basis of her chronic L5 and S1 root involvement as a consequence of the spinal stenosis.

If one uses the range of motion model: She would receive 7% for unoperated severe degenerative changes and 19% for loss of range of motion. The loss of sensation and strength in the S1 distribution in both legs warrants a 13% impairment of each lower extremity based upon the involvement of the S1 root; this is equal to a 6% impairment of the whole person for each lower extremity.

Using combined value tables, 7 - 19 = 25; 25 - 6 = 30; 30 - 6 = 34% impairment of the whole person.

I believe that using the DRE method of 40% impairment best describes this patient’s limitations.

On September 4, 1996, Dr. James revised his opinion concerning the employee’s PPI rating. Taking into consideration the employee’s previous injuries, Dr. James discounted the 40% PPI rating to 20%, leaving a residual PPI of 20% attributable to the 1996 injury.

This rating was controverted by the insurer and the employee was sent to Eric Carlsen, M.D., Dr. Hadley’s partner, for evaluation. In his October 7, 1996 report, Dr. Carlsen states:

I think it is reasonable to assume that she did have a significant exacerbation in right-sided L5–S1 radiculopathy related to this injury. From page 102 she would be awarded a DRE Lumbosacral category III, or a 10% whole person impairments of her lumbosacral spine as it relates to this injury. Given her prior 7% impairment of the lumbosacral spine, she would be awarded a 3% whole person impairment as related to this most recent injury.

Thereafter, the employer and carrier accepted the claim, and paid the larger Impairment rating of 20%. The employee has never returned to work. On September 26, 1997, Thomas Hunt, M.D., commented in a written report about the employee’s physical and vocational status. We did not consider his opinion in reaching this decision, however, because the employer filed a Smallwood objection. See 8 AAC 45.900(11).

On November 13, 1997, Dr. James was again asked to re-evaluate the employee. Medical Management Specialist Carol Jacobsen, wrote to Dr. James summarizing a conference she had with him. Dr. James was asked to sign the following statement if he agreed with the summary:

In meeting with you, I understand that in your opinion Ms. Hoschar may be permanently and totally disabled. Any disability she may suffer, however, is not related to her low back injuries with the Midtown Daycare Center. I also understand that in your opinion, there is no need for any further medical care relative to her low back injuries. In your opinion, her need for ongoing medical treatment for low back pain is more likely due to her underlying disc disease unrelated to the low back injuries.

Dr. James signed this statement. The employee took Dr. James’ deposition on April 16, 1999. (Dr. James Depo.) Dr. James testified he treated the employee on July 16, 1991 for the 1990 injury. (Id. at 5-6.) He next saw the employee on April 22, 1996. (Id. at 6.) He quoted her as saying that her earlier symptoms from the 1990 injury abated and she began conservative measures. (Id. at 7.) He said she had some improvement with therapy, but he didn’t think she was a candidate for surgery because of her aneurysm. (Id. at 9.) Her also commented that she wasn’t a "particularly well lady." (Id. at 8-9.)

In his deposition, Dr. James re-iterated his opinion that the employee’s impairment rating is40%, discounted 50% for pre-existing pathology, to equal 20% whole man impairment for the 1996 accident. (Id. at 10.) Dr. James explained his signing Carol Jacobsen’s statement as follows:

A . . . I’d characterize it -- you know, I (indiscernible - mumbling). She was medically stable at that point in time.

Q All right. And.....

A And as far as -- as further -- need for further medical care -- gee, I must have glossed over that one.. She was well prior -- you know, this -- this is not a malingering lady, or someone with a lot of -- of, oh, secondary gain involved in – in her presentation., So when she presented in -- August of that year, and when we -- in July and August when we did the impairment rating on her, that believe it would be reasonable and accurate that 20 percent -- you know, if she -- 50 percent could be attributed to preexisting problems and 50 percent to her most recent injury. Any further medical care could probably be allocated in the same type of pattern, would probably be a better way of doing it. That would be a fair way to look at this thing. Because she was not pain free and she was not made whole again by August of 1996, or when I saw her, whenever that -- ‘96 or ‘97. So she wasn’t made whole to her pre-‘96 injury -- ‘97, I’m sorry.

Q Okay,.

A No, it was "96. I’m sorry. Let me -- let me be clearly acc- -- clearly acc- -- clearly accurate about this. In the -- in August and September of -- with the impairment rating in August of ‘96, we had an addendum to the impairment rating in September 4^th, 1996, in which I made the statement that 50 percent of her pathology was preexisting.

Q Okay,

A And the -- and so 50 percent of the rating could be attributed to the preexisting and 50 percent was due to the accident, because of the fact that you have to take people as they are,. And I guess that would be my point.

Q So she had a pre-existing rating from 1991 to which a three percent addition. . . .

A Seven, seven.

Q Seven percent, I beg your pardon., A seven percent rating from 1991. And then Dr. Hadley added -- or Dr, Carlson added an additional three percent, although you had rated her at 40 percent, is that correct?

A No, no,

Q Okay.

A I don’t know that Carlson -- I didn’t know he even rated her.

Q Okay. And this letter says -- and of course it says that any disability she may suffer, however, is not related to her low back injuries with the Midtown Day Care. And . . .

A Well I’d like to -- I’d like to modify that, because I really didn’t even consideration -- any need for ongoing medical care has to be allocated, too,. I think that one -- the comp company’s going to -- if she was not made whole again to her pre-‘96 level, and did not recover to that level, then I -- they have to -- they have some continued assumption of -- of medical care responsibility. Are they totally responsible? No,

Q Okay. So in this situation then, the comment that you made any disability she may suffer, you are now modifying to indicate that at least partially -- part of the disability she suffers may be attributable to her injuries?

MS. HEIKES: I object, that’s not what he said., He was speaking to medical care and not disability.

A Medical care, yeah. Medical care.

Q Okay.

A I think I -- and I mis -- I misunderstood this I believe, when I did this,. And I -- that doesn’t reflect -- that’s not consistent with our thought process to that -- up to that point. The thought process up to that point is that this lady did have an injury, she was not made whole again after the injury, and -- and we had to use the 4^th Edition of the AMA Guidelines, and so we had to put her into an area which is best defined by the DRE system, which is that -- the category we used. And then calculating on that basis, 50 percent of her presentation should be preexisting, and therefore she was left with 20 percent. One would also -- to take that even further, is that future medical care and requirements with regard to her back are going to have to look at the same fashion. I’m sorry that the day care center was caught in this industrial injury, and an impaired individual, however I think the law has been clear in the past that you take people the way they are.

MR. ERWIN: That’s fine. I have no other questions.

CROSS EXAMINATION

BY MS. HEIKES:

Q I just want to go over this, so I understand. You’re saying that -- let’s go through this November 13^th, ‘97 letter, if we could, Doctor, one line at a time,. In meeting with you, I understand that in your opinion Ms. Hoschar may be permanently and totally disabled.

A Yes.,

Q Is that still a correct statement?

A That’s correct. As far as I know, since I last saw her.

(Id. at 10-14.)

On page 25 of the deposition, attorney Heikes acknowledged the insurer had accepted and paid the 20% impairment figure. Dr. James said: "I think the 20 percent that we’ve allotted to her adequately compensates her for the problems she’s had as a consequence of her -- her permanent exacerbation of her problem. I think that’s a fair number." (Id. at 23.)

In cross examination, attorney Heikes expressed to Dr. James the difference between "physical impairment" and "disability." She defined "disability" as "the incapacity to earn wages due to the injury." When asked whether the employee has any disability, as defined, and whether the work injury was a substantial factor in that disability, Dr. James answered: "No, I don’t think so." (Id. at 24.) The employer’s argument against an award of PTD primarily relies on this testimony from Dr. James which affirmed his signature of Carol Jacobsen’s written statement.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

I. Is the employee permanently totally disabled?

AS 23.30.180 provides in part:

(a) [P]ermanent total disability is determined in accordance with the facts. In making this determination the market for the employee's services shall be (1) area of residence; (2) area of last employment; (3) state of residence; and (4) the State of Alaska.

(b) Failure to achieve remunerative employability as defined in AS 23.30.041(p) does not, by itself, constitute permanent total disability.

First, we review the meaning of the each of the terms encompassing the phrase "permanent total disability." AS 23.30.265(10) defines "disability" as the "incapacity because of injury to earn wages which the employee was receiving at the time of injury in the same or any other employment."

In Alaska Intern. Constructors v. Kinter, 755 P.2d 1103 (Alaska 1988), the court adopted the definition of "permanent" given by Professor Larsen in his treatise: "Permanent means lasting the rest of claimant's life. (Cite omitted.). In addition, a condition that, according to available medical opinion, will not improve during the claimant's lifetime is deemed a permanent one. If its duration is merely uncertain, it cannot be found to be permanent." Id. at 1105.

"Total" was defined in J.B. Warrack v. Roan, 418 P.2d 986 (Alaska 1966). The court stated:

For workers compensation purposes total disability does not necessarily mean a state of abject helplessness. It means the inability because of injuries to perform services other than those which are so limited in quality, dependability or quantity that a reasonably stable market for them does not exist. (Footnote omitted). . . . As the Supreme Court of Nebraska has point out, the "odd job" man is a nondescript in the labor market, with whom industry has little patience and rarely hires. (Footnote omitted).

Id. at 988.

The Board has also addressed "permanence" from both a physical and vocational aspect in Lau v. Caterair International #616, AWCB Decision No. 95-0053 (February 27, 1995). In Lau, there was conflicting evidence about the employee's potential for improving her physical capacitates through non-invasive medical treatment, specifically, physical therapy. The evidence presented by the employer showed Lau had no interest in performing physical therapy, even though three physicians believed she would greatly benefit from such a program. The employer argued Lau's condition was not permanent because several doctors indicated she would improve if she chose to undergo proper treatment. The Board stated:

We do not find Employer's argument convincing. A finding of permanence does not require unequivocal concurrence on the part of physicians. As the court stated in Alaska Intern. Constructors v. Kinter, 755 P.2d 1103, 1105 (Alaska 1988):

The fact that the medical experts offered some cautious comments that [Employee] might someday be able to work in a non-demanding job does not preclude the Board's finding. In order for a claimant to be permanently totally disabled, he need not establish that there is no chance of him ever doing anything again.

Moreover, the issue is not the employee's physical condition per se but her ability to compete in the labor market. The concept of disability compensation rests on the premise that the primary consideration is not medical impairment as such, but rather loss of earning capacity related to that impairment. Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska 1974). We find no evidence any possible improvement in her physical condition will result in better prospects for employment.

Lau at 11-12.

The term "oddlot" has also been used by the Alaska Supreme Court to explain an injured worker's PTD status. In Hewing v. Peter Keiwit & Sons, 585 P.2d 182, at 187 (Alaska 1978), the court stated, by citation to Justice William Cardozo's opinion in Jordan v. Decorative Co. (cite omitted) that: "He is the 'odd lot' man, the 'nondescript in the labor market.' Work if he gets it, is likely to be casual and intermittent. . . . Rebuff, if suffered, might reasonably be ascribed to the narrow opportunities that await the sick and halt." (Footnote and citations omitted). Additionally, the court advised, when making a determination of PTD the other factors to be considered "include not only the extent of the injury, but also age, education, employment available in the area for persons with the capabilities in question, and intentions as to employment in the future." Id. at 185.

In Lake v. Chugach Electric, AWCB Decision No. 97-200 (October 7, 1997), the Board analyzed the "odd-lot" doctrine and the "other factors" articulated by the Hewing Court in relation to an injured employee who lacked educational (although not intellectual) capacities to compete for readily available positions, given his physical limitations. Because Lake suffered from intractable pain, treatment for which the employer had controverted, he was unable to meaningfully engage in the vocational reemployment process. The Board stated:

[W]hen Employee's limited vocational skills are combined with the restriction he not use his dominant arm/hand and the limitations imposed by his untreated debilitating pain, we find Employee lacks the overall capabilities, at this time, to competitively reenter the labor market for the positions identified by Employer as being continuously and readily available. We conclude Employee is "oddlot," as that term is explained in Hewing, by citation to Justice Cardozo's opinion in Jordan v. Decorative Co. (cite omitted). . . . Based on our conclusion Employee is odd lot, we conclude Employee is permanently and totally disabled, at this time.

Id. at 10.

In Sulkosky v. Morrison-Knudsen, 919 P.2d 158, 167 (Alaska 1996), the Alaska Supreme Court synthesized its earlier decisions by pronouncing that an injured worker is permanently and totally disabled if there is not "regularly and continuously available work in the area suited to his capabilities."

Applying the concept articulated in Sulkosky, the Board has found an injured worker of very limited intellectual capacity may be permanently and totally disabled because of his physical injuries. Fleming v. Municipality of Anchorage, AWCB Decision No. 98-0226 (September 2, 1998). The reemployment counselor assigned to Fleming's claim concluded she was unable to prepare a reemployment plan for an identifiable job Fleming could perform, or even be trained to perform, because of his permanent physical, mental, verbal, and reading abilities. The reemployment file was closed. In making its determination of PTD status, the Board stated:

[W]e find the employee is an unskilled worker who made his way in life based on a diligent work ethic and back-breaking manual labor.

We find an [in]adequate labor market survey tailored to the employee's actual capacities, and . . . lack [of] wage research or significant employer contacts. We find the specific . . . positions. . . identified are oddlot jobs. We find [this] evidence is untested and too speculative to accord very much weight.

Based on the medical record, based on the documentary record of the vocational rehabilitation efforts provided for the employee, and based on the testimony of the rehabilitation experts . . . , we find the preponderance of the evidence shows there is no regular and continuous work available which is suited to the employee's capabilities in the American labor market. We find the employee is "oddlot," as that term is explained in Hewing.

. . . .We share a concern with the employer that the employee may benefit from additional vocational assistance. He is a relatively young man, who clearly enjoyed his work. The Alaska Supreme Court made it clear in Meek, 914 P.2d, at 1278-1279, that PTD benefits do not prohibit additional vocational services, nor are PTD benefits to be interpreted to forestall the possibility of the employee eventually finding remunerative employment. We commend the employer's resolve to continue to assist the employee in his attempt to return to the work force.

Id. at 13-14.

When making a determination under Section 180, in accordance with the authorities cited, we must apply the presumption of compensability under AS 23.30.120(a). Meek v. Unocal, 914 P.2d 1276, 1279 (Alaska 1996). 23.30.120 provides, in part: "In a proceeding for the enforcement of a claim for compensation under this chapter it is presumed, in the absence of substantial evidence to the contrary, that (1) the claim comes within the provisions of this chapter. . . ."

"[I]n claims based on highly technical medical considerations, medical evidence is often necessary in order to make that connection." Burgess Construction Co. v. Smallwood, 623 P.2d 316 (Alaska 1981). In less complex cases, lay evidence may be sufficiently probative to attach the presumption. Veco, Inc. v. Wolfer, 693 P.2d 865, 871 (Alaska 1985).

If an employee attaches the presumption, the employer must produce substantial evidence the disability is not permanent, or total. See Smallwood, 623 P.2d at 316. In the case of a PTD claim, the employer must rebut the presumption there is "not 'regularly and continuously available work in the area suited to the [employee's] capabilities,' i.e., that he is not an 'odd lot' worker." Sulkosky, supra.

Substantial evidence is such relevant evidence as a reasonable mind would accept in light of all the evidence to support a conclusion. Kessick v. Alyeska Pipeline Serv. Co., 617 P.2d 755, 757 (Alaska 1980). "Since the presumption shifts only the burden of production, and not the burden of persuasion, the evidence tending to rebut the presumption should be examined by itself." Wolfer, 693 P.2d, at 869.

There are two methods of overcoming the presumption of compensability: (1) presenting affirmative evidence showing that the employee does not suffer a permanent total disability; or (2) eliminating all reasonable possibilities that the disability is permanent, or total. Grainger v. Alaska Workers' Compensation Board, 805 P.2d 976, 977 (Alaska 1991).

Once the employer produces substantial rebuttal evidence, the presumption drops out, and the employee must prove all elements of the case by a preponderance of the evidence. Wolfer, at 870. "Where one has the burden of proving asserted facts by a preponderance of the evidence, he must induce a belief in the minds of the [triers of fact] that the asserted facts are probably true." Saxton v. Harris, 395 P.2d 71, 72 (Alaska 1964).

Applying the presumption analysis outlined, we must first determine whether the employee has attached the presumption, that, because of the industrial injury, she permanently lacks the capabilities (physical, mental, and/or vocational) necessary to work in jobs which are regularly and continuously available. We find the employee has attached the presumption she is permanently and totally disabled because of the work injury by producing a combination of lay and expert evidence and testimony. We make this finding as follows.

The parties agree, and we also find, based on the testimony and reports of Drs. Hadley and James the employee can not return to her job at the time of injury. Dr. James testified the employee has a 20% permanent impairment from the instant injury. This PPI rating was accepted and paid by the insurer. It is uncontroverted the employee has pre-existing health problems which, combined with her present impairments, will not allow her to return to work. This opinion is shared by numerous physicians. Her age is 67. When Dr. James last saw her in November 1996 she was able to walk only with a walker because of pain. She has an eighth grade education and she has raised nine children. Her skills are limited by her lack of education and her experience is limited to child care. Apparently the parties agree, and we find, her physical condition prevents her retraining. She never returned to work after her injury.

In sum, we find the employee has presented sufficient evidence to raise the presumption of compensability. Therefore, the employer must present substantial evidence to overcome the presumption. We find the employer has not presented such substantial evidence. Each medical opinion offered by the employer was clouded by ambiguity, which must be resolved in the employee’s favor. For example, although Dr. James said the employee’s low back injuries do not relate to "any disability that she may suffer," he also concluded the employee suffered a 20% impairment from the instant injury and concluded the employee is permanently totally disabled. Similarly, Dr. Hadley stated, "I do not feel that the March incident was the reason that the employee has been unable to return to work," but also concluded upon examination of the employee, base upon the amount of "structural abnormality" she has, she recommend a "sedentary to light duty position." Dr. Hadley also said, "I would not expect [the employee’s] level of physical capabilities to increase in the future." Dr. Hadley also concluded, "I do not feel Ms. Hoschar could return to work as a day care provider or children assistant." As indicated, we find there is doubt as to the substance of all medical testimony and evidence presented by the employer in this case, which must be resolved in favor of the employee. Beauchamp v. Employers Liab. Assurance Corp., 477 P.2d 993 (Alaska 1970). See also, Grainger v. Alaska Workers' Compensation Board, 805 P.2d 976. Therefore, we find the employee has not presented substantial evidence to overcome the presumption of compensability.

Even if the medical evidence presented could be construed as substantial evidence, overcoming the presumption and placing the burden of production on the employee, we would find the employee has proven her claim by a preponderance of the evidence. Specifically, we note the employee was fully functioning as a day care provider and children assistant until her March, 1996 injury. She has not returned to work since. We find any isolated medical opinions offered to suggest the 1996 injury is not related to her present condition is without merit. Based on our review of the evidence as a whole, including the employee’s age, education, medical condition and work experience, we find the employee’s claim for permanent total disability benefits is compensable. We find the employer shall pay these benefits.

The employer shall pay the employee’s claim for permanent total disability benefits in accordance with this decision.

Dated at Fairbanks, Alaska this 30^th day of December, 1999.

ALASKA WORKERS' COMPENSATION BOARD

/s/ Fred Brown
Fred Brown, Designated Chairman

/s/ Harriet M. Lawlor
Harriet M. Lawlor, Member

If compensation is payable under terms of this decision, it is due on the date of issue and penalty of 25 percent will accrue if not paid within 14 days of the due date unless an interlocutory order staying payment is obtained in Superior Court.

This compensation order is a final decision. It becomes effective when filed in the office of the Board unless proceedings to appeal it are instituted. Proceedings to appeal must be instituted in Superior Court within 30 days of the filing of this decision and be 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 party may ask the Board to reconsider this decision by filing a petition for reconsideration under AS 44.62.540 and in accordance with 8 AAC 45.050. The petition requesting reconsideration must be filed with the Board within 15 days after delivery or mailing of this decision.

Within one year after the rejection of a claim or within one year after the last payment of benefits under AS 23.30.180, 23.30.185, 23.30.190, 23.30.200 or 23.30.215 a party may ask the Board to modify this decision under AS 23.30.130 by filing a petition in accordance with 8 AAC 45.150 and 8 AAC 45.050.

I hereby certify that the foregoing is a full, true and correct copy of the Decision and Order in the matter of LALIA G. HOSCHAR employee / applicant; v. MIDTOWN DAY CARE CENTER INC, employer; ALASKA NATIONAL INS. CO., insurer / defendants; Case No. 199604426; dated and filed in the office of the Alaska Workers' Compensation Board in Fairbanks, Alaska, this 30^th day of December, 1999.

Lora Eddy,Clerk

SNO