Second Injury Fund Questionnaires Can Provide Protection for Employers
In response to a rising number of fraudulent workers' compensation claims, the Louisiana Legislature in the late 1980s enacted two statutes providing for the forfeiture of benefits in certain situations in which claimants misrepresent themselves. The first statute--R.S. 23:1208 --made it unlawful for a person to willfully make false statements or representations in order to obtain workers' compensation benefits. The legislature also enacted R.S. 23:1208.1 which provides for forfeiture of benefits when an employee answers untruthfully to an employer's inquiry about previous injuries, disabilities, or other medical conditions in a Second Injury Fund questionnaire. This article focuses on how an employer can utilize medical questionnaires to protect itself from employees who misrepresent prior injuries. The employer also receives the added benefit of potentially shifting exposure to the Second Injury Fund if the employee is truthful and suffers a subsequent work injury.
The Louisiana Legislature created the Second Injury Fund to encourage employers to hire employees with permanent partial disabilities. To encourage this practice, an employer's liability is limited in the event that an employee who was knowingly hired or retained with a permanent partial disability has a subsequent accident in which the second injury merges with the previous disability to cause a greater disability than would have resulted had there been no pre-existing disability. If this occurs, an employer's liability is limited to 104 weeks of weekly indemnity benefits and $7,500 of medical expenses. However, to benefit from the Second Injury Fund, an employer must knowingly hire or retain an employee with a permanent partial disability. To do this, employers frequently require employees--including recently hired employees--to complete questionnaires that inquire about the employee's medical condition and prior injuries. These are frequently referred to as Second Injury Fund questionnaires. If an employee does not answer questions truthfully on the questionnaire regarding previous injuries, disabilities, or other medical conditions, then the employer cannot benefit from the Second Injury Fund.
If an employee does not answer questions truthfully on the questionnaire regarding previous injuries, disabilities, or other medical conditions, it may result in the forfeiture of benefits in the event that the employee later makes a workers' compensation claim. There are requirements of a Second Injury Fund questionnaire for an employer to be able to utilize the forfeiture provisions under R.S.23:1208.1. The statute itself provides that "this section shall not be enforceable unless the written form on which the inquiries about previous medical conditions are made contains a notice advising the employee that his failure to answer truthfully may result in the forfeiture of workers' compensation benefits under R.S. 23:1208.1. Such notice shall be prominently displayed in boldfaced blocked lettering of no less than 10-point type." If this notice is not provided, and is not typeset in boldfaced 10-point type on the questionnaire, an employee's benefits will not be forfeited, even if he misrepresents to his employer about previous injuries or medical conditions. If the notice requirement is satisfied, then an employer must show that the employee's failure to answer truthfully on the questionnaire--related to the medical condition for which a claim for benefits is made--affects the employer's ability to receive reimbursement from the Second Injury Fund.
The Louisiana Supreme Court addressed R.S.23:1208.1 in two recent decisions, Resweber v. Haroil Construction Company, 94-C-2708 (La 9/5/95) 660 So.2d 7 and Wise v. J. E. Merit Constructor, Inc., 97-C-0684 (La 1/21/98), 707 So.2d 1214. In Resweber, the court recited the requirements of a written notice in boldfaced blocked lettering in 10-point type as described above. The court also noted in Resweber that forfeiture only applies when the false statement "directly relates to the medical condition for which a claim was made or affects the employer's ability to receive reimbursement from the Second Injury Fund."
In Wise, the Supreme Court further explained the requirement by holding that "directly relating to the medical condition for which a claim is made" means that a subsequent injury was inevitable or very likely to occur because of the presence of the pre-existing condition. If that cannot be proven by the employer, then the employer must prove that the untruthful answer prevented the employer from recovering from the Second Injury Fund. To do this, the employer must establish the existence of a permanent, partial disability and a merger between the pre-existing disability and the second injury that resulted in a greater disability. The court also noted in the Wise decision that, because the statute is penal in nature, ambiguities in the questionnaire itself or the employee's responses are construed in favor of the employee and against the employer. Numerous other decisions from the courts of appeal have interpreted ambiguities similarly.
What can an employer do to ensure the protection of 23:1208.1 with the resulting forfeiture of benefits if an employee misrepresents previous injuries, disabilities, or other medical conditions? How can an employer benefit from the protections found with the Second Injury Fund? They can utilize the Employee Medical History form accessible at www.lwcc.com. If an employer is using a Second Injury Fund questionnaire that is not provided by LWCC, it should be confirmed that there is a notice on the questionnaire advising the employee that the failure to answer truthfully may result in forfeiture of workers' compensation benefits under R.S. 23:1208.1 and that the notice is displayed in boldfaced, blocked lettering of no less than 10-point type. Because ambiguities will be construed against the employer, it is also recommended that efforts be made to clarify any ambiguities that may be present in the employee's responses on the questionnaire at the time of completion. Employers should make sure that the employee completes the questionnaire in full at the place of business. The employer should also review the questionnaire with the employee to make sure that all responses to the questions are answered appropriately. If a response does not seem to make sense or is confusing, it is likely that a court will find it ambiguous and not order that benefits be forfeited. Finally, the employer should make sure the employee signs and dates the questionnaire at the time it is completed.
A Second Injury Fund questionnaire is beneficial to an employer in many ways. In regards to workers' compensation, the questionnaire can potentially limit an employer's exposure on a claim by providing for forfeiture of workers' compensation benefits if an employee fails to answer truthfully about previous injuries, disabilities or other medical conditions. The questionnaire can also establish knowledge of a pre-existing permanent partial disability of an employee and limit the employer's exposure for workers' compensation benefits in the event that the employee is later injured and has a greater disability because of a merger of the prior disability with a subsequent injury. In either event, the use of the questionnaire may result in a significant reduction in the amount paid on a claim, which benefits all LWCC policyholders.