Scott v. Liberty Northwest Ins. Corp.

An authorization of temporary disability benefits is legally sufficient under ORS 656.262(4) when an objectively reasonable insurer would understand contemporaneous medical reports to signify approval excusing the worker from work.

On appeal from the Workers’ Compensation Board (the board), the Court considered whether Scott, who was medically stationary on an underlying and compensable low-back claim, was nonetheless entitled to begin receiving temporary disability benefits on an accepted claim for an omitted medical condition. After Scott suffered a work-related injury to her back, she had several surgeries, and was found by a physician, on September 18, 2008, to be medically stationary. In October of 2008, Liberty awarded Scott compensation for time lost through September 18, 2008, as well as a permanent disability award, which was reduced by the board. In December 2009, a physician wrote Liberty, stating that Scott has surgical scarring resulting from her compensable back condition, and that the surgical scarring also had been medically stationary since September 18, 2008. Scott sought a hearing seeking temporary disability benefits for her omitted condition of surgical scarring. The omitted condition claim had not been closed as of the date of the hearing. An administrative law judge (ALJ) awarded temporary disability benefits from September 2008 through the date of the hearing. The board reversed the ALJ, concluding that the surgical scarring was found to be permanent, not temporary. The Court found that the board erred in determining that Scott was not eligible for temporary disability relief, holding that a new or omitted claim is to be processed like any other claim. The Court reasoned that the medical evidence showing Scott’s disability might be permanent did not preclude her entitlement to temporary disability benefits, because as of the date of the hearing, the claim remained open; the medically stationary date had not then been determined. Vacated and remanded.