Summer 2008 SBH Quarterly Newsletter
PDF FormatLate Notice of Closure Triggers Penalties/Fees
By Ron Pomeroy
Oath Boun, 60 Van Natta 411 (2008) has opened the door wide for claimants to obtain significant penalties and assessed attorney fees when a Notice of Closure is not issued within 10 days of request under ORS 656.268(5)(d).
In Boun, the original claims professional responsible for this claim left for another job on August 1, 2006 and a new individual took over the file. Claimant’s attorney faxed the former adjuster on August 16, 2006 requesting closure of the claim. The new adjuster was not aware of the request and issued neither a Notice of Closure nor a Notice of Refusal to Close. Claimant requested a hearing.
A Notice of Closure issued November 17, 2006 after it was determined that an expansion request would be accepted by an MNOA. The ALJ found the delay unreasonable and assessed a $4,000 attorney fee under ORS 656.268(5)(d). The Board upheld the assessed fee and also the 25% penalty on amounts then due at the time of the closure. The Board found the delay unreasonable even though the employer argued they were attempting to determine work restrictions in order to validly close the claim.
Four lessons from this and earlier cases involving claim closure requests can be taken: (1) close the claim within 10 days of the administrator’s receipt of the request; (2) if not possible, issue a Notice of Refusal to Close within 10 days; (3) document any delay beyond 10 days in detail; and (4) failure to strictly comply with the statute will result in a 25% penalty on amounts then due at closure and a large assessed attorney fee.
It is apparent excuses for delay will be deemed insufficient and “unreasonable” in the absence of very well documented and persuasive reasons for inaction. Obtaining necessary information from the attending physician within the context of tight deadlines and repeated follow up, coupled with inaction by the attending physician, is probably the sole acceptable reason for claim closure delay and will, nonetheless, still be looked upon with suspicion based upon recent Board and Court decisions.
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