In Nevada, under Nev. Rev. Stat. § 616B.578, in order for an employer to receive reimbursement from the state’s “Subsequent Injury Account,” it must prove that that it had knowledge of a preexisting permanent physical impairment that would support a rating of at least six percent whole person impairment. In a recent decision, the Supreme Court of Nevada clarified, however, that the statute cannot be reasonably interpreted to require knowledge of a specific medical diagnosis in order for an employer to seek reimbursement successfully [North Lake Tahoe Fire Prot. Dist. v. Board of Admin., 2018 Nev. LEXIS 107 (Dec. 6, 2018)].
In 1981, the District hired an applicant as a paramedic and firefighter (the employee). For approximately 20 years, the employee worked without a documented injury. Between 2002 to 2007, however, the employee injured his back on numerous occasions while on duty and sought treatment following his injuries. Doctors diagnosed the employee with various back conditions, such as herniated nucleus pulposus (HNP), radiculopathy, back sprain, and lumbar disc abnormalities.
In November 2007, the employee then suffered a subsequent back injury while on duty, and following this injury, doctors specifically diagnosed the employee with spondylolisthesis. A few years later, the employee underwent back surgery for the condition, and a year after his surgery, the employee retired.
Shortly after the employee retired, Dr. David Berg conducted a PPD evaluation on the employee in response to the employee's November 2007 back injury and rated the employee with a 21 percent whole person impairment (WPI) with no apportionment for any preexisting condition. At the request of the third-party administrator, Dr. Jay Betz reviewed the employee's medical records and Dr. Berg's PFD evaluation. Dr. Betz disagreed with Dr. Berg's conclusion regarding no apportionment and instead found that the employee's spondylolisthesis was a preexisting impairment with a seven-nine percent WPI. Dr. Betz further found that at least half of the 21 percent WPI should be apportioned to the employee's preexisting conditions, and thus, 11 percent WPI should be apportioned to the November 2007 injury (10.5 percent rounded up).
The Board concluded, in pertinent part, that § 616B.578 required the employer to show that it knew specifically of the employee's spondylolisthesis condition prior to the subsequent injury in order to receive reimbursement from the Subsequent Fund. Accordingly, the claim for reimbursement was denied.
Supreme Court’s Decision
The Supreme Court said the Board's interpretation of § 616B.578 was reasonable in part. To qualify for reimbursement, indeed, the employer was required to establish by written record either that the employer (1) had knowledge of the permanent physical impairment at the time the employee was hired or (2) retained its employee after it acquired knowledge of the permanent physical impairment. The Court added that the employer need not prove, however, that it had specific knowledge of a specific medical diagnosis (here, spondylolisthesis) in order for it to successfully seek reimbursement. The Court stressed, however, that the employee's preexisting permanent physical impairment must be fairly and reasonably inferred from the written record. The Court concluded that here, there was a lack of clarity concerning the employer's specific knowledge. In that light, the Court reversed and remanded the cause.