Cruz-Salazar v. SAIF Corp. (In re Cruz-Salazar)

317 Or.App. 342

506 P.3d 1145

In the MATTER OF the COMPENSATION OF Reina CRUZ-SALAZAR, Claimant.

Reina Cruz-Salazar, Petitioner,

v.SAIF Corporation and KB Restaurant, Respondents.

A171110

Court of Appeals of Oregon.

Argued and submitted September 17, 2020.

February 2, 2022

Philip M. Lebenbaum, Portland, argued the cause for petitioner. On the briefs was Theodore P. Heus.

Allison Lesh, Eugene, argued the cause and filed the brief for respondents.

Before Egan, Presiding Judge, and Lagesen, Chief Judge, and DeHoog, Judge pro tempore.^*

DeHOOG, J. pro tempore Claimant seeks review of an order of the Workers’ Compensation Board affirming an order of an administrative law judge (ALJ) that had reduced claimant's award of benefits for impairment made by the Appellate Review Unit of the Workers’ Compensation Division of the Department of Consumer and Business Services (ARU). We conclude that, in light of the Supreme Court's opinion in Caren v. Providence Health System Oregon, 365 Or. 466, 487, 446 P.3d 67 (2019), which issued after the board's order in this case, the board erred, and we therefore reverse and remand for reconsideration.

Claimant injured her left arm at work after slipping and falling on a wet floor. SAIF, on behalf of its insured employer KB Restaurant—KGK Foods—Carl's Jr., accepted a claim for "left elbow contusion and impingement syndrome of left shoulder." After claimant's attending physician determined that claimant's injury was medically stationary, SAIF issued a notice of closure that did not award any benefits for permanent disability. On reconsideration, a medical arbiter opined that claimant had findings, such as decreased sensation, that were not explained by the medical record and that were possibly indicative of undiagnosed conditions. He opined that 20 percent of claimant's impairment was due to the accepted condition and 80 percent due to the undiagnosed conditions. The ARU awarded claimant benefits for 100 percent of her impairment, including impairment potentially linked to the as-yet undiagnosed conditions.

The ALJ reduced that award, reasoning that the apportionment of benefits for impairment was appropriate under former OAR 436-035-0007(1) (2017), because the record did not establish that the impairment due to the undiagnosed conditions was attributable to the accepted conditions. The board upheld the apportionment, reasoning that claimant was not entitled to benefits for impairment due to conditions that had not been claimed and accepted, essentially reasoning that, under ORS 656.214(1)(a) (providing that "[p]ermanent impairment resulting from the compensable industrial injury" is "the loss of use or function of a body part or system due to the compensable industrial injury"); ORS 656.268(15)¹ ("Conditions that are direct medical sequelae to the original accepted condition shall be included in rating permanent disability of the claim unless they have been specifically denied."); and OAR 436-035-0007 (2017), benefits for impairment may not be awarded for a condition that has not been accepted or that is not the direct medical sequela of an accepted condition.

On judicial review, claimant contends that the board's order must be reversed in light of the Supreme Court's opinions in Caren , in which the court held that a worker is entitled to benefits for the worker's total impairment if the work injury is a material contributing cause of the worker's total impairment, and Schleiss v. SAIF , 354 Or. 637, 317 P.3d 244 (2013), in which the court held that apportionment may be applied only to "legally cognizable" preexisting conditions.

Claimant is correct that Caren requires a reversal of the board's order. Caren involved the question of whether a claimant's benefit for impairment could be reduced by that portion of the impairment caused by a preexisting condition. The court said in Caren that, by providing a process for claim closure in claims involving combined conditions, ORS 656.268(1)(b) (setting forth procedure for the denial of combined conditions), the legislature had created an exception to the "general rule" that a worker is to be compensated for total impairment that is caused in material part by the compensable injury.

"[T]he method for calculating impairment in cases of combined conditions [as described in ORS 656.268(1)(b) ] is an exception to, and limitation on, the general rule that the employer pays compensation for the full measure of the workers’ permanent impairment if the impairment as a whole is caused in material part by the compensable injury."

Caren , at 487, 446 P.3d 67. The court held that, if an insurer believes that a portion of a worker's impairment is due to a combining of the compensable injury with a preexisting condition, it is not up to the claimant to first seek benefits for the preexisting condition; it is the insurer's responsibility to deny that condition before claim closure. Id. at 480-81, 446 P.3d 67. If the insurer does not deny the condition before claim closure, the claimant is entitled to benefits for the total impairment caused in material part by the compensable injury.

As we understand the court's opinion in Caren , it means that a worker's total impairment is compensable if it is caused in material part by a compensable injury, and that benefits for impairment may not be reduced for impairment caused by a preexisting condition, unless (1) the preexisting condition is one that is "cognizable" under ORS 656.005(24) (to qualify as a preexisting condition, a condition must have been treated or diagnosed before the compensable injury, "[e]xcept for claims in which a preexisting condition is arthritis or an arthritic condition"); and (2), before claim closure, the insurer has formally denied a combined condition involving the preexisting condition. If...