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Judicial Review is Out of Reach for Most Injured Workers
When the
But whatever parity that exists between injured employees and insurance carriers at the administrative level is wiped out when insurance carriers exercise their right to have unfavorable administrative decisions reviewed by a state district court in a process known as judicial review. Insurance carriers are always represented by legal counsel at judicial review, usually by highly qualified law firms that specialize in workers compensation administrative law, because they have funds to pay lawyers. But the Office of Injured Employee Counsel is prohibited by statute from aiding injured employees facing judicial review, and frequently it is impossible for injured workers to find legal representation, either because they do not have funds to pay an attorney, or because they simply cannot find an attorney qualified and willing to take their cases.[3]
Instead of serving as a check on the administrative process, judicial review often allows an insurance carrier to win what it lost in the administrative process by the simple fact that it can find and hire an attorney to represent it while the injured worker usually cannot. When injured workers can’t find legal representation they often lose the right to lifetime medical treatment for a workplace injury through an uncontested ruling. Also, the State of
Under the benefit dispute resolution process of the
In 2004 twice as many judicial review cases were brought by insurance carriers as were brought by injured employees.[5] This is not surprising because injured employees usually do not have funds available to hire an attorney because once they are injured, they are typically unemployed and subsisting on a benefit payment equal to 70 percent of their usual weekly pay. Also, since few attorneys represent injured workers in workers compensation cases, it is difficult to find an attorney competent to take this sort of case.
In 2001 the
An injured employee who is sued by an insurance carrier receives notice that they have been sued, and has 20 days within which to find an attorney and to file an answer to the suit with the court. They have all of the difficulties listed above with finding legal counsel. As a consequence injured employees often do not respond to the suit, and the carrier takes a default or summary judgment in their favor.[7] Even though the worker is not able to or does not choose to contest the suit, the court is obligated to issue a ruling in favor of the carrier.
Often this holding has no immediate impact on the worker, since in many cases salary replacement benefits will have already been paid and medical treatment will already have been received. But the injured worker will lose his right to lifetime medical treatment for the workplace injury, so if a problem arises in the future, the worker will have to pay for treatment him or herself.
Judicial Review is Costly to the State of Texas
A summary judgment holding can be very expensive to the State of
The number of cases and amounts paid to insurance carriers are increasing at a rapid rate. In the first 11 months of 2006 insurance carriers were reimbursed more than $750,000 in 20 cases, more than double the number and amount for all of 2005.
Payments to Insurance Carriers in Judicial Review Cases[9]
Year Total paid # Highest Single Case
2000 $152,688.08 7 $99,271.34
2001 $225,235.45 13 $44,337
2002 $268,846.31 8 $142,571.77
2003 $625,372.78 10 $429,054.23
2004 $263,093.58 18 $39,861.93
2005 $333,308.96 10 $106,118.30
2006 $751,760.29 20 $174,532.54
Total $2,620,305 86
An additional inequality is caused by the difficulty of injured workers who lose an administrative appeal to hire legal counsel to represent them in judicial review. Current law only requires that carriers pay reasonable legal costs for injured workers who prevail at the highest administrative level and in judicial review. This means that an injured employee who loses at the administrative level has no practical way to contest that finding, since they usually do not have funds to pay attorney’s fees. This undermines the point of judicial review, which is to provide a judicial check on the administrative process which is equally available to all parties.
Policy Recommendations
The judicial review process as it currently operates is unfair to injured workers and costly to the State of
1) Legislation should be passed limiting insurance carrier reimbursements from the Subsequent Injury Fund to judicial review cases where the injured employee is represented by counsel and the lawsuit is contested. Carriers should not be reimbursed pursuant to motions for summary judgment.
2) Public defenders should be provided to injured employees who are sued by insurance carriers, as recommended by the Office of Injured Employee Counsel and as proposed by Texas Senate Bill 287.
3) The State Bar of Texas and all Bar Associations operating legal referral services should redouble their efforts to identify attorneys willing to represent injured workers in judicial review cases.
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[5] Data taken from Texas Workers’ Compensation System Data Report,
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[7] (No good data exists on the frequency of default and summary judgments since the State of
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[9] Texas Department of Insurance, Division of Workers’ Compensation, Open Records Request #56703, “Request concerning a report of reimbursements paid to insurance carriers from subsequent injury fund.”
