Articles & Updates

ALERT! MO Supreme Court Holds the LIRC Has Jurisdiction to Decide Future Medical Disputes After Partial Settlements.

by James B. Kennedy and Mary Anne Lindsey

In a decision issued July 21, 2015 the Missouri Supreme Court en banc addressed and resolved an issue which has perplexed workers’ compensation practitioners for decades: What are the parties’ options to resolve a future medical dispute after they have settled a claim, but agreed to leave future medical “open”? The case is Stateex rel. ISP Minerals v. The Labor and Industrial Relations Commission (“ISP v. LIRC”). However, in so finding, the Supreme Court may have opened up a “Pandora’s Box” of consequences it did not foresee when addressing this seemingly limited issue.

ISP v. LIRC was a prohibition/mandamus action which arose out of the settlement of an occupational disease claim. In the settlement, the parties left medical open and designated a pulmonologist to monitor the employee’s lung disease. A dispute arose over the specialist’s prescription for inhalers. Employee presented the dispute to the LIRC. The LIRC concluded it had jurisdiction to hear the dispute, and ordered a hearing. ISP filed a petition in prohibition arguing the LIRC did not have jurisdiction. It relied on two prior decisions, Mosier v. St. Joe Lead Co. (Mo. App. 1992) and Shockley v. Laclede Elec. Co-Op (Mo. App. 1992), in so arguing. If the LIRC was divested of jurisdiction at the moment of settlement approval, claimant would have to reduce the settlement to a judgment in circuit court, and file an action for specific performance of the settlement contract, or for a declaration of the employer’s future medical responsibility under the settlement.

Mosier and Shockley held under Section. 287.390, the LIRC lost jurisdiction upon approval of the settlement. However, the Supreme Court distinguished these decisions, noting that in Mosier and Schockley the settlements specifically stated all of the employer’s liability, including medical liability, was being extinguished. Conversely, in IPS v. LIRC, medical was left open. The Supreme Court found nothing in the language of Section 287.390 stated a settlement under that Section deprived the LIRC of jurisdiction.In addition, the Supreme Court drew a parallel between a settlement which leaves medical open on one hand, and a partial award in which future medical remains unresolved, on the other hand. In the case of a partial award, the LIRC retained jurisdiction, so why should jurisdiction be lost in a case which had been settled, but in which the parties had agreed to leave medical open?

Finally, the Court found that the determination of an employee’s right to medical treatment under Section 287.140 was an issue which was considered to be “within the exclusive province of the Division of Workers’ Compensation” (and therefore within the province of the LIRC on appeal or after the Division has otherwise lost jurisdiction).To uphold ISP’s position would be to create an exception to that principle.

Comment: It is true that before the Supreme Court’s decision ISP v. LIRC, the parties were faced with circuit court litigation to resolve fact issues which should properly be within the purview of the Division or LIRC. However, few circuit court judges have the necessary experience and expertise to act as Administrative Law Judges or LIRC members. Moreover, even the most skillfully drafted open medical settlement provisions cannot purport to predict and address every issue which might arise in the future, to the extent necessary to permit a circuit court to resolve any and all disputes based upon the contract’s language alone. To this extent then, the Court’s determination the LIRC should resolve such issues makes good sense. The problem, though, is that the ruling also raises questions for which there are currently no answers; such as: 

  1. Is the LIRC bound by any contract language relating to future treatment which the parties may have incorporated into the Settlement Stipulation or can the LIRC consider medical open for any and all purposes?
  2. Since the Court likened a settlement in which medical is left open to a partial award, is such a settlement agreement no more binding than a partial award?
  3. Could the LIRC extend its jurisdiction to reconsider disability issues which the settlement agreement purported to conclusively resolve?
  4. Since open medical is by definition open for the life of the employee, can medical be closed by a later additional settlement agreement or pursuant to a final award or order of the LIRC?

Copyright: Evans & Dixon, L.L.C., 2015

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