Case Note: Garden Glen Farm vs. Bethany Taylor Balderas SC Published 5/14/2015

Workers Comp: An employer can’t receive credit for the full amount of a lump-sum workers compensation settlement to lower the amount of benefits due to a former employee whose case was reopened

48.  Workers Compensation, Reopened claim.
Garden Glen Farm vs. Bethany Taylor Balderas
SC Published 5/14/2015; Affirming COA
Questions Presented: Workers Compensation. Reopened Claim. When a settled claim is reopened, the monetary value of the original negotiated settlement may not reflect the claimant’s actual disability. The change in occupational disability should be calculated as the difference between the actual disability on the date of the settlement, as found by the ALJ, and the occupational disability at the time of reopening.

Earlier cash settlement doesn’t reduce workers comp benefits | Business Insurance An employer cant receive credit for the full amount of a lump-sum workers compensation settlement to lower the amount of benefits due to a former employee whose case was reopened, the Kentucky Supreme Court has ruled. Court records show that she was injured in November 2006 when a horse she was riding fell and rolled over her. She later negotiated a lump-sum workers comp settlement of $100,000, based partly on a disability impairment rating of 29%.

When “a settled claim is reopened, the monetary value of the original negotiated settlement may not reflect the claimant’s actual disability,” the ruling reads. “The change in occupational disability should be calculated as the difference between the actual disability on the date of the settlement, as found by the (administrative law judge), and the occupational disability at the time of reopening.”  From http://www.businessinsurance.com/

Appellant, Gardens Glen Farm, filed this appeal from a Court of Appeals decision to contest the Administrative Law Judge’s (“ALJ”) calculation of a credit for money paid to Appellee, Bethany Balderas, pursuant to a settlement. Gardens Glen argues that the ALJ erred by refusing to give it a dollar for dollar credit based on the lump sum settlement it entered into with Balderas. For the below stated reasons, we affirm the Court of Appeals. Balderas was injured when a horse she was exercising at Gardens Glen rolled over on her. Balderas sustained two fractured vertebra and underwent fusion surgery. She later returned to work. Balderas negotiated a lump sum settlement of $100,000 with Gardens Glen, which reflected a 29% impairment rating and a return to work factor of 1.5509453.

Balderas was injured when a horse she was exercising at Gardens Glen rolled over on her. Balderas sustained two fractured vertebra and underwent fusion surgery. She later returned to work. Balderas negotiated a lump sum settlement of $100,000 with Gardens Glen, which reflected a 29% impairment rating and a return to work factor of 1.5509453. Several years later, Balderas filed a motion to reopen alleging a worsening of her occupational disability. The motion was sustained. The ALT determined that Balderas met her burden of proof to show a worsening of her condition based on objective medical evidence. The ALJ found that the proper return to work factor at the time of the original award was one. She then found that Balderas’s whole body impairment at the time of her settlement was 29% and that it rose to 30% at the time of reopening. The ALJ also found that Balderas was entitled to the three multiplier, pursuant to KRS 342.730(1)(c), on reopening because she was no longer able to work as an exercise rider.

In this matter, the AU did not err in calculating the credit owed to Gardens Glen. The ALJ found that the rating used for the original settlement award, 29% whole body impairment, was an accurate reflection of Balderas’s original occupational disability. She also determined that the return to work factor at the time of the original award should be one instead of the 1.5509543 used in the settlement. The ALJ’s findings are supported by the record and indicate a credit for Gardens Glen of $180.42 per week. The AU then did not abuse her discretion by finding that Balderas’s whole body impairment on reopening rose to 30%. Taking the difference between the amount Balderas was entitled to on reopening ($456.25) and subtracting it from the value of her original award ($180.42), then factoring in the 99% cap, lead to an increase in her benefits of $275.83 per week. The ALJ did not abuse her discretion in so finding. For the above stated reasons, we affirm the decision of the Court of Appeals. All sitting. All concur.

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