5 Common Mistakes Insurers Make in Massachusetts
Massachusetts is a form driven state and because of the short deadlines for action by the insurer mistakes happen. This guide will highlight several of the more common mistakes to look out for. If you see one, you might want to investigate further with the insurer or a competent attorney.
1. Pay without Prejudice (PWOP) PeriodIn Massachusetts, the PWOP period runs initially for 180 days. See M.G.L. ch. 152, section 7.
The insurer MUST make Payment (using a form 103) or Deny (using Form 104) within 14 days of receipt of either the Form 101 (FROI) First Report of Injury from the employer or Form 110 (employee claim).
Failure to make payment timely leads to numerous problems that may included:
A) Loss of the PWOP period
B) Payment of a $200 penalty to the employee
C) Late payment in the absence of the $200 penalty and/or Section 19 agreement could be interpreted as acceptance of the claim and loss of any unilateral rights.
D) Under Section 7 the penalty for failure to file the denial or notice of payment can reach $10,000. This is rare. Actually penalties are rare as most insurer's will correct mistakes when notified in most cases.
2. Extension of the PWOP PeriodThe PWOP period may be increased by using a DIA Form 105 to up to 364 days if agreed to by the employee and approved by the DIA. The signature of the employee and / or attorney must occur within the initial 180 days and more often then not the approval by the DIA within the first 180 days as well.
The original Form 105 is not always necessary as most often the form is faxed or scanned and e-mailed.
The refusal by an employee to agree to extend the PWOP period is a common trigger for an insurer to schedule an IME and evaluate the claim at that time before the 180 days expire.
3. Waiting Period under Section 29The right to weekly benefits is not triggered until a minimum waiting period has elapsed.
Section 29. No compensation pursuant to section thirty-four or thirty-five shall be paid for any injury which does not incapacitate the employee from earning full wages for a period of five or more calendar days. If incapacity extends for a period of twenty-one days or more, compensation shall be paid from the date of onset of incapacity. If incapacity extends for a period of at least five but less than twenty-one days, compensation shall be paid from the sixth day of incapacity. Except as otherwise provided in this chapter, no compensation shall be paid for any period for which any wages were earned. No mental or emotional disability arising principally out of a bona fide, personnel action including a transfer, promotion, demotion, or termination except such action which is the intentional infliction of emotional harm shall be deemed to be a personal injury within the meaning of this chapter.
4. No Right to Non-Payment of Ordered BenefitsMassachusetts does NOT allow for an insurer to withhold payment under an order, decision or agreement pending a dispute or appeal. Massachusetts requires that an insurer make all payments due, whether they are aware of them or not (to be later explained).
No Interlocutory Appeal
All payments must be timely made after the issuance and receipt of an order, decision or Agreement or other document requiring payment. Failure to do so could result in penalties under one or both of Section 8(1) and 8(5). In Massachusetts worker's compensation, an appeal does not stay the obligation to make all necessary payments. See, Pacellini v. Cape Cod Fireplace Shop, AJ, P. Costigan (no ability of Administrative Judge to stay penalties pending decision or conference order due to appeal). See also Paul Levesque v. Travelers, J. McCarthy 2/16/07.
5. Termination of weekly benefits during the PWOP Period.Section 8 requires that the insurer provide the employee with a minimum of seven (7) days notice when altering the employee's weekly benefits during the PWOP period (using Form 106 unless the reason is a verified return to work).
The DIA does not count the mailing date as one of the seven "notice" days. The failure to provide the full seven (7) days can result in a penalty for illegal discontinuance of the employee's benefits under Section 8.