Medical Provider's Decision to Bill Medicare, Rather than Carrier, Results in NC Employee's Loss of Benefits on Statute of Limitations Grounds

The Court of Appeals of North Carolina affirmed a decision by the state’s Industrial Commission that denied additional medical benefits claimed by an injured worker on statute of limitations grounds where, unbeknown to both the worker and the employer’s workers’ compensation carrier, the medical provider stopped billing the carrier and began to bill Medicare, and four years passed before the employee sought approval for new pain management treatment from the employer and carrier [Dunbar v. Acme Southern, 2020 N.C. App. LEXIS 781 (Nov. 17, 2020)]. The Court stressed that there was no legitimate reason to read additional language into the two-year statute of limitations found in N.C. Gen. Stat. § 97-25.1.

Background

Dunbar sustained injuries in 1998 and received medical compensation from his employer’s insurer for more than a decade. Dunbar and the carrier reached a settlement regarding Dunbar’s indemnity compensation, but did not agree as to Durbar’s medical compensation. Prior to 2013, however, Dunbar’s medical providers billed the carrier for medical treatment and the carrier paid the bills.

Sometime in 2013, Dunbar’s medical providers began billing Medicare for reimbursement rather than the employer’s carrier. Neither Dunbar nor the carrier knew of this change in billing practice. The carrier made no payments for treatment after October 2013.

In 2017, Dunbar was referred to a medical provider for pain management. He sought authorization from the employer and carrier for this treatment, but it was denied. On 15 February 2018, more than four years after the carrier last paid any medical compensation for Dunbar’s 1998 injuries, Dunbar filed a request with the Commission for a hearing to determine whether he was entitled to further medical compensation from the employer and carrier.

Following a hearing, a deputy commissioner concluded that Dunbar was not entitled to continued medical compensation because he had not submitted a request for more than two years since the carrier’s last payment. The Full Commission affirmed and Dunbar appealed.

Appellate Court Decision

The appellate court noted that the Commission denied Dunbar’s claim based on N.C. Gen. Stat. § 97-25.1, which provides that “[t]he right to medical compensation shall terminate two years after the employer’s last payment of medical or indemnity compensation unless” the employee’s right to further compensation is preserved in one of two ways, neither of which the court indicated applied in the case.

The court acknowledged Dunbar’s argument that section 97-25.1 should be read in pari materia with N.C. Gen. Stat. § 97-18(h), which requires an insurer that provides coverage to an injured employee to notify the employee and the Commission promptly when it has made its “final” payment. Essentially, Dunbar contended that the insurer should not be deemed to have made its “last” payment under § 97-25.1, thus starting the two-year clock, unless and until the carrier provided notice to Dunbar that it had made its “final” payment under § 97-18(h). The appellate court disagreed.

The court stressed that the notice requirement in § 97-18(h) regarding “final payment” was unrelated to the two-year provision in § 97-25.1 regarding “last payment.” Moreover, indicated the court, the plain language of § 97-18(h) indicated that the appropriate sanction for failing to provide such a notice of a “final” payment was a nominal civil fine of $25. Had the General Assembly intended that providing notice under § 97-18(h) was a condition to bar future claims under § 97-25.1, it would have said so, indicated the court.

The court added that § 97-18(h) simply did not apply to the case; there was no way for the insurer to know that its October 2013 payment would be the last payment for which Dunbar would seek for medical care. The court also was unpersuaded by Dunbar’s estoppel and due process arguments.