Walker v. Providence Health System Oregon

Pursuant to ORS 656.268(5)(d), an employer must respond to a request for claims closure within 10 days, and failure to respond will result in a penalty equal to 25 percent of the benefits the employee is determined to be entitled to.

Walker, an employee, sought review of the findings of the Worker’s Compensation Board (Board) that she was not entitled to penalties and attorneys fees for her employer’s failure to close her disability claim within the statutorily mandated 10 days after a request for closure was issued. The employer originally accepted disability coverage for anxiety with depression but later denied Walker’s claims for other anxiety disorders. The denial was set aside by an Administrative Law Judge (ALJ). After the ALJ’s decision, Walker requested the claim be closed and the employer sought an independent medical exam (IME) before closing the claim. Walker attended the IME and requested claim closure again on September 30, 2009, based on the report of the IME. The employer did not close the claim until November 5, 2009, denying any disability. Walker appealed the notice of closure and was awarded compensation for 35 percent disability. Walker then argued that she was entitled to a penalty under ORS 656.268(5)(d) equal to 25 percent of the compensation she was entitled to. An ALJ found, and the Board agreed, that Walker was not entitled to an award of the penalty because the employer’s refusal to close the claim was not unreasonable under the facts, and that when the claim closure was issued on Nov. 5, Walker’s claim was denied and no benefit was “then due”. The Court of Appeals held that the employer’s actions were not reasonable, and, that because Walker was eventually awarded 35 percent disability, the amount “then due” to her at the time she requested claim closure on September 30 was 35 percent disability. Therefore, the Court found, pursuant to ORS 656.268(5)(d), that the “then due” amount under the claim was 35 percent disability and failure to respond to the requested claim closure within 10 days resulted in a penalty equal to 25 percent of the benefits Walker was entitled to. Reversed and remanded.