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Illinois appeals panel: Medical providers can't recover interest from employers who pay WC medical bills late

By Elizabeth Alt | May 9, 2018

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CHICAGO — An Illinois appellate court has decided a health care provider is not entitled to recover interest from employers when they don’t pay worker compensation medical bills on time. Further, the court said such disputes actually may not belong in the courts, at all, but rather with the state's Workers Compensation Commission.

The April 26 decision on the appeal, which was heard by Illinois First District Appellate Court Justices Margaret McBride, David E. Ellis and Robert E. Gordon, reversed a decision by a Cook County Circuit Court judge. McBride delivered the court’s unanimous decision.

The appeal centered on claims submitted by Medicos Pain & Surgical Specialists S.C. and Ambulatory Surgical Care Facility LLC, which provided medical care for a Blackhawk Steel Corp. employee who fell four stories off a truck in 2010, injuring his shoulders and nose.

The medical providers had filed suit in Cook County Circuit Court, seeking to recover $37,229 in interest under the Workers’ Compensation Act after they “had to wait several years for payment from” Blackhawk and its insurer, Travelers Indemnity Company of America, for the medical care they provided.

After the trial court sided with the medical providers, Blackhawk and Travelers appealed, arguing the decision was “flawed for multiple reasons, including that while this appeal was pending, this court determined in 2017 that Medicos, Ambulatory, and other medical service providers who sued for statutory interest… do not have a private right of action for the failure of an employer or insurer to comply with the interest provision of the [Workers’ Compensation] Act,” according to the appellate court’s decision.

The medical providers, however, contended there were “no grounds for reversing the trial court’s decision.”

The crux of the case revolves around faxes exchanged between the parties. Medicos Pain & Surgical Specialists and Ambulatory Surgical Care faxed surgery approval requests to Travelers, which provided workers’ compensation insurance for Blackhawk at the time, according to the appellate court’s decision.

The insurer sent two faxes approving the procedure, but it did not indicate the amounts that would be covered, the appellate court noted.

The medical providers based their argument on "promissory estoppel," a legal term for a legally enforceable promise relied upon to the determinent of one party.

In this case, Medicos and Ambulatory claimed the faxes indicated an “unambiguous promise” that Travelers would cover the surgery, and asserted the insurer had “damaged” it by approving procedures to “induce [the] plaintiffs to allow those procedures to be performed… and thereafter failing to pay.”

Travelers, however, asked for reconsideration, arguing it was “inappropriate for the court to proceed solely on the statutory interest claims.”

Travelers further claimed only the Illinois Workers’ Compensation Commission has jurisdiction over compensation proceedings, not the trial court - and the appellate justices agreed.

“We find that regardless of whether Medicos and Ambulatory intended to proceed under the promissory estoppel theory or purely on a statutory basis, ultimately their only basis for claiming interest was Section 8.2(d) of the Act and that the claim failed because medical service providers are not members of the class for whose benefit the Act was enacted,” McBride said in the decision. “…[W]e find that the plaintiff medical service providers failed to state a claim upon which relief could be granted and that the trial court erred in awarding the statutory interest.”

Additionally, Justice Gordon issued a specially concurring opinion.

“The role of the trial court in workers’ compensation proceedings is to act in an appellate capacity only on a properly filed matter governing a decision of the Workers’ Compensation Commission,” Gordon wrote in his opinion. “…The circuit court of Cook County had no jurisdiction to decide the issue of interest and cannot decide any of the theories advanced by plaintiffs.”

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Travelers Indemnity CompanyIllinois First District Appellate Court