New rule applied in retirement disability cases with opinion of a treating physician to be given greater weight than that of a government physician: CLAXON V. KENTUCKY RETIREMENT SYSTEMS (COA 2/1/2008)

CLAXON V. KENTUCKY RETIREMENT SYSTEMS
EMPLOYMENT: STATE RETIREMENTS BENEFITS: SUFFICIENCY OF MEDICAL EVIDENCE

Claxon appeals TC’s denial of her motion to alter, amend or vacate its prior Order affirming the decision of the Kentucky Retirement Systems to deny her disability retirement benefits. Claxon had worked as a cook in the Greenup County School System before ending her employment in 2000 and applying for disability retirement benefits 9 months later. Her application was denied on initial consideration and reconsideration, and following a hearing during which testimony was heard, the Hearing Officer submitted his Order recommending denial due to her failure to establish her inability to work by objective medical evidence. The Disability Appeals Committee adopting this Order as final, which led to Claxon’s action filed in Franklin Circuit Court. Following full briefing of the issues by the parties, the TC affirmed the final order denying the application. This appeal followed.

The COA begins by noting that the burden of proof during this administrative disability hearing was on Claxon, and that as fact finder the administrative agency is afforded great latitude in its evaluation of the evidence and testimony presented during the hearing. A reviewing court can thus only overrule the agency on factual issues if the agency’s decision is arbitrary and capricious. In analyzing the hearing evidence, the COA found that the Officer’s decision was not supported by substantial evidence and therefore was arbitrary. The COA first took issue with the apparent violation of Claxon’s statutory right to inspect any medical reports submitted for consideration on behalf of the agency and respond to them prior to the hearing, as the agency tendered written reports from Dr. Burgess and Dr. Shraberg after the hearing. The COA also established a new rule of law in retirement disability cases by holding that the opinion of a treating physician shall be given greater weight than that of a government physician, which has been followed in the past in disability cases. The COA finally took issue with the Officer’s failure to indicate in his Order why he gave greater weight to the agency’s physicians than Claxon’s treating physicians, and when considered in conjunction with the possible inadmissibility of the post-hearing reports, reversed and remanded the case back to the TC.

By Chad Kessinger, Schiller Osbourn Barnes & Maloney