Without IREs, How Will Pennsylvania Insurance Companies Limit Exposure?

In the past, IREs were often requested by insurance companies after an injured employee received 104 weeks, or two years, of total disability compensation. The original purpose of an IRE was to prevent the abuse of the Pennsylvania Worker’s Compensation System by workers who should be able to return to the labor force. The IRE was used to determine the claimant’s level of whole body impairment; if a doctor working for the insurance company decided that this level fell below 50%, the claimant would be categorized as only partially disabled. The amount of compensation would not be changed, but a limit would then be imposed on how long partial disability compensation had to be paid. The claimant was thus limited to 500 cumulative weeks of disability compensation.

IREs, however, have been determined unconstitutional after a recent Pennsylvania Supreme Court ruling on Protz v. WCAB (Derry Area School District) on June 20, 2017. One of the questions that has arisen because of this ruling involves how insurance companies will now limit their exposure. They have a backup plan: labor market surveys, also known as earning capacity assessments.

Labor Market Survey Process

A labor market survey is used to determine the type of work that the claimant is still able to perform. This is based on expert evidence that can take several different forms, including job listings with private job placement agencies and the Department of Labor and Industry, and levels of activity in the claimant’s usual employment areas.
The labor market surveys are conducted by a state-certified vocational counselor or vocational expert who is hired by the insurance company. Keep in mind that the objective of the insurance company is to pay out as little as possible to the claimant. The vocational counselor is working for the insurance company, and no matter how pleasant the title may sound, he or she is not interested in realistic work opportunities for the claimant.

Before a labor market survey is performed, the insurance company will send the claimant a Notice of Ability to Return to Work. It will state who the physician is that determined the claimant is now able to return to work and what the medical reasons are behind that decision. The vocational counselor will perform of survey of jobs in the claimant’s geographical region that, in theory, the claimant could hold. This is based on the claimant’s education, age, experience, residual productive skill, and medical limitations. These medical limitations are typically those determined by a physician working for the insurance company.

In addition, the vocational counselor will interview the claimant. One of the purposes of this interview is to determine any skills the claimant possesses that could theoretically be transferred to a new career. Note that for the protection of the claimant, this interview should always take place in an attorney’s office with the attorney present.

Outcome of a Labor Market Survey

The outcome of a labor market survey is a hypothetical projection of how much the claimant can potentially make if they go back to work in one of the jobs the vocational counselor has decided they are suitable for. Based on this information, the insurance company will attempt to justify a reduction or cessation of benefits based on pay the claimant could hypothetically be receiving for working at a theoretical job.

How Labor Market Surveys Impact Claimants

Based on the results of the labor market survey, the attorney for the insurance company can file a petition to have the claimant’s benefits reduced or suspended if the vocational counselor determines that there are open and available jobs that are suitable for the claimant. Were the claimant to apply for every one of these positions and still be unable to find employment, their benefits would still be affected. This is the tool that insurance companies are going to exploit in order to minimize the benefits they are required to pay out now that IREs have been determined unconstitutional.

Potential Injustice in Labor Market Survey System

There are inherent weaknesses in the labor market survey system. The survey is based on theoretical situations that may or may not reflect real conditions. It does not consider the medical opinions of any doctors outside those selected by the insurance company. These surveys have no reliable way of establishing whether the job openings are available or if the potential employer would even be interested in hiring the claimant. This can be particularly devastating to claimants caught in a recession economy. These jobs often include positions such as overnight security work or telemarketing which often have a high turnover (and for good reason).

There is Hope

A skilled, experienced worker’s compensation lawyer knows how to fight back against these tactics. There are specific rules that must be followed before a claimant’s benefits can be successfully reduced or stopped. There are holes that can be poked in the insurance company’s case by a smart lawyer. There are common pitfalls and mistakes that insurance companies make that can be put to work on the claimant’s behalf. A labor market survey doesn’t have to decimate your compensation.

Impairment Rating Evaluations (IREs) are Back!

In October of 2018, Act 111 was passed amending the Pennsylvania Workers’ Compensation Act to to re-institute Impairment Rating Evaluations (IREs). This law is brand new and is being challenged as unconstitutional and in violation of the rights of workers who were injured before the passage of this legislation. It is way too soon to determine whether this new law will withstand the multiple challenges that are expected. It is important to challenge IREs and requests for IRE exams early on. This ever evolving area of Pennsylvania Workers’ Compensation law is very complicated and it is essential to have experienced legal representation to help you navigate all of the potential traps. If you have received a request for an Impairment Rating Evaluation, call me and I will help you understand whether you have to attend and how attendance/or non-attendance will effect your rights.

Fighting Back with Hillsberg

If you believe that your worker’s compensation benefits may be threatened by a Labor Market Survey, contact Hillsberg Law as soon as possible. I have been handling worker’s comp cases in the state of Pennsylvania since 1995, and worker’s comp is all that I do. Contact us today for a free consultation and let us fight for every penny of compensation that you deserve.

The advice offered above is general in nature and may not be applicable to every case. Consultation with an attorney is highly recommended. Reliance on this advice does not represent the formation of an attorney-client relationship in the absence of a fee agreement with Mr. Hillsberg.

Get in Touch

Fill out the form with a brief description of your situation or call me at (610) 566-0600 and I’ll be in touch to schedule a free consultation.


Get in Touch

Fill out the form with a brief description of your situation or call me at (610) 566-0600 and I’ll be in touch to schedule a free consultation.