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Malcomson v. Liberty Northwest: On Privacy Rights in Workers’ Compensation Claims

Our workers’ compensation attorneys in Massachusetts understand the importance of claimants seeking legal representation as early in the process as possible. While it may seem like the employer is on your side, their insurance company or the state workers’ compensation fund may be far more interested in reducing the amount of claims paid out than the well-being of a worker injured on the job.

1314902_medical_doctor.jpgMalcomson v. Liberty Northwest, a case argued before the Supreme Court of Montana, involved an employee who was injured while working at a pizza restaurant. Employee, a manager at the restaurant, injured her back while on the job. She sought medical treatment the day she was injured and also filed a workers’ compensation claim.

The workers’ compensation insurance company hired a registered nurse to serve as employee’s case manager and as an agent of the company. The nurse gave employee a Claimant’s Authorization form that was signed by employee in January of 2008. This form is required if employees wish to receive workers’ compensation benefits.

A relevant state statute provided that, once the form was signed by employee, employee’s healthcare workers were permitted to exchange information with the insurance company and other medical providers. Employee was not required to be notified if and when information was exchanged.

The first thing her case manager did was to schedule medical appointments for claimant, and the case manager chose practitioners. The nurse even rescheduled appointments to make them more convenient for her schedule without taking employee’s input into account. Nurse also called employee’s doctors without her knowledge.

Employee was collecting on a temporary partial disability (TPD) rating when she received notice from the insurance company that her benefits were being terminated because her employer had notified the insurance company that employee had been terminated from her job for disciplinary reasons.

Employee obtained an attorney and sought to have benefits reinstated and also revoked the Claimant’s Authorization. Her attorney told the insurance company that her doctors were not to be contacted without the attorney’s knowledge.

At an emergency hearing before the Workers’ Compensation Commission, employee, through counsel, challenged the constitutionality of both statutes. The commission found that they did not have jurisdiction to the review the constitutionality of all but one of the statutes and only focused on that claim.

The commission held that the statute authorizing the blanket Claimant’s Authorization form violated her constitutional right of privacy. It allowed the insurance company to discuss matters with employee’s health-care providers that had nothing to do with her workers’ compensation claim.

The commission found that, while there was a legitimate interest in regulating the workers’ compensation program, the law was not narrowly tailored to serve the state’s interests while protecting claimants. The insurance company appealed this ruling.

On appeal, the court recognized the importance of privacy rights concerning medical treatment. There was no problem with requiring the insurance company have access to the records relevant to the workers’ compensation claim, and even do so without first contacting claimants. However, the level of involvement and the actions of the nurse in this case far exceeded the needs of the insurance company, and these provisions were found unconstitutional.

If you are injured on the job in Boston, call the Law Offices of Jeffrey S. Glassman for a free and confidential consultation to discuss your workers’ compensation claim: 1-888-367-2900.

Additional Resources:

Malcomson v. Liberty Northwest, September 10, 2014, Montana Supreme Court

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Ohio Settles Lawsuit over Workers’ Compensation Premiums, August 2, 2014, Boston Workers’ Compensation Lawyers Blog