What the panel ordered
The WCAB rescinded the WCJ's decision that defendant is not barred from obtaining third-party credit pursuant to Civil Code section 3333.1 and amended the decision to bar defendant from obtaining third-party credit for any workers' compensation benefits paid or due.
Petitions for reconsideration filed by applicant and defendant were granted to further study legal and factual issues; this decision is after reconsideration of the WCJ's Findings & Order issued June 29, 2018.
What was disputed, and how it came out
Each issue the panel decided, with the reasoning it gave. An outcome is what this panel did on this record — not a rule, and not a prediction.
The WCAB found substantial evidence that the applicant's civil action settlement was demonstrably reduced by consideration of collateral source payments, barring defendant from third-party credit under Civil Code section 3333.1 and Graham.
From the decision · page 12it is our decision after reconsideration to rescind the WCJ's decision that defendant is not barred from obtaining third-party credit pursuant to Civil Code section 3333.1 (F&O, Findings of Fact, Nos. 2-3, and Order). It is also our decision after reconsideration to amend the WCJ's decision to include his determination that "the description of the causes of action in the [civil] complaint and the facts set forth in Plaintiff's [applicant's] mediation brief, do establish facts that are sufficient to state a cause of action for professional negligence" pursuant to section 3333.1 and Flores v. Presbyterian Intercommunity Hospital (2016) 63 Cal. 4th 75 [2016 Cal. LEXIS 2561] (Flores)
The facts that decided it
What the panel treated as outcome-determinative, and which side it favoured.
Favours Applicant prevailed
This established the applicability of MICRA to the case, which is central to the bar on third-party credit.
From the decision · page 12FINDINGS OF FACT... 2. Applicant's civil lawsuit filed on July 30, 2012 against third party Mission Hospital Regional Medical Hospital, states a cause of action for professional negligence pursuant to Civil Code section 3333.1 and Flores v. Presbyterian Intercommunity Hospital (2016) 63 Cal. 4th 75 [2016 Cal. LEXIS 2561]. 3. The settlement of applicant's civil lawsuit filed on July 30, 2012 against third party Mission Hospital Regional Medical Hospital was demonstrably reduced by the consideration of collateral source payments. 4. Defendant is barred from obtaining third party credit pursuant to Civil Code section 3333.1 and Graham v. Workers' Comp. Appeals Bd. (1989) 210 Cal.App.3d 499 [54 Cal.Comp.Cases 160].
The settlement of applicant's civil lawsuit was demonstrably reduced by consideration of collateral source payments.
Favours Applicant prevailed
This fact supports the bar on defendant's third-party credit under Civil Code section 3333.1 and Graham.
From the decision · page 12FINDINGS OF FACT... 2. Applicant's civil lawsuit filed on July 30, 2012 against third party Mission Hospital Regional Medical Hospital, states a cause of action for professional negligence pursuant to Civil Code section 3333.1 and Flores v. Presbyterian Intercommunity Hospital (2016) 63 Cal. 4th 75 [2016 Cal. LEXIS 2561]. 3. The settlement of applicant's civil lawsuit filed on July 30, 2012 against third party Mission Hospital Regional Medical Hospital was demonstrably reduced by the consideration of collateral source payments. 4. Defendant is barred from obtaining third party credit pursuant to Civil Code section 3333.1 and Graham v. Workers' Comp. Appeals Bd. (1989) 210 Cal.App.3d 499 [54 Cal.Comp.Cases 160].
The rules the panel named
Authorities as the decision cited them, with how this panel applied each one.
Graham v. Workers' Comp. Appeals Bd. (1989) 210 Cal.App.3d 499
Civil Code section 3333.1 bars employer's credit remedies when the injured party's recovery is demonstrably reduced to reflect collateral source contributions.
The Board applied this standard to determine that the defendant is barred from obtaining third-party credit because the settlement was demonstrably reduced.
From the decision · page 3In Graham v. Workers' Comp. Appeals Bd. (1989) 210 Cal.App.3d 499, the Court of Appeal held section 3333.1 applies to future workers' compensation benefits. Id. at 503-506. The workers' compensation subrogation statutes include both reimbursement provisions and credit provisions that apply when an injured employee recovers from a third party tortfeasor. Id. at 503. "[R]eimbursement applies to benefits paid prior to a third party judgment or settlement. With respect to future workers' compensation benefits due the injured party, a different mechanism applies - credit. An employer is entitled to a credit against its obligation to pay further compensation benefits in the amount of the worker's net recovery against the third party tortfeasor. State Comp. Ins. Fund v. Workers' Comp. Appeals Bd. (1997) 53 Cal.App.4th 579, 583 (emphasis in original).
What proof carried it
The evidence the panel weighed, by kind.
Applicant's civil action settlement was demonstrably reduced by consideration of collateral source payments, supported by testimony from applicant's civil attorney and case law.
From the decision · page 9We agree with applicant that the record, when considered in its entirety, contains substantial evidence that the settlement in the civil action was "demonstrably reduced" to exclude any recovery for collateral source benefits. (See Graham, supra, 210 Cal.App.3d at p. 508 citing to Barme v. Wood (1984) 37 Cal.3d 174 [1984 Cal. LEXIS 120].) Here, the WCJ identified three basis for the award of third-party credit in this case:
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About this page
- A published decision of the California Workers' Compensation Appeals Board, taken apart by what it turned on. The Board publishes the decision itself; this page adds the extraction and quotes the passage behind every claim.
- The injured worker is not named here, and the case caption is not printed. Physicians appear as the decision names them, because a medical opinion is an act in a public proceeding.
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