Not All Misstatements About Medical History Disqualify an Applicant for Worker’s Compensation Benefits

Bellino v. Verizon Wireless, 435 N.J. Super. 85 (App. Div. 2014).  The Workers Compensation Act, N.J.S.A. 34:15-1 to -142 (“the Act”), contains an “anti-fraud” provision in N.J.S.A. 34:15-57.4.  Under that provision, a person who “purposely or knowingly makes, when making a claim for benefits pursuant to [the Act] a false or misleading statement, representation or submission concerning any fact that is material to that claim for the purpose of wrongfully obtaining the benefits, the [D]ivision [of Workers Compensation] may order” the immediate denial or termination of benefits and a forfeiture of any right to compensation regarding that claim.

Plaintiff made a claim for temporary disability and medical benefits for injuries that she sustained while working for defendant Verizon Wireless.  The workers compensation judge who heard the case and saw the witnesses, including plaintiff and her doctors, found that plaintiff had established her right to the benefits, and rejected Verizon’s contention that plaintiff was barred from receiving benefits because she had committed fraud.  Verizon had argued that plaintiff had not disclosed to the doctors every medication she had been taking, all details about prior injuries to her hand and back, her prior history of substance abuse, and her prior psychiatric treatment and issues.  Plaintiff asserted that she had made every effort to be fully truthful, and that she was not always certain about the times and dates of previous treatments.  The workers compensation judge found that “the medical records introduced into evidence reflected petitioner’s pre-existing conditions and prior use of medications and were reviewed by treating and examining physicians of both parties.”

Verizon appealed, and the Appellate Division affirmed in an opinion by Judge Hayden.  The panel applied a deferential standard of review to the compensation judge’s finding that plaintiff had shown her entitlement to benefits.  A compensation judge “is considered to have expertise with respect to weighing the testimony of competing medical experts and appraising the validity” of claims for benefits.  Moreover, the judge sees the witnesses, which an appellate court does not, so the judge’s credibility determinations get great deference.

Judge Hayden also rejected Verizon’s claim that plaintiff had violated the Act’s anti-fraud provision and was for that reason ineligible for benefits.  The Act is “humane social legislation” that must therefore be interpreted “liberally and inclusively.”  The Act places the cost of workplace injuries on employers, but deprives injured employees of the right “to pursue other remedies that could yield larger recoveries.”

“The anti-fraud provision is intended to root out fraudulent claims, not merely test an injured person’s ability to remember every detail of a lengthy medical history or to accurately determine what may be material for purposes of receiving treatment or other benefits.”  Thus, Judge Hayden continued, “[i]t  is not enough that the moving party show the worker made an inaccurate or false statement or omitted material facts.  Rather, the moving party must show (1) the injured worker acted purposefully or knowingly in giving or withholding information with the intent that he or she receive benefits; (2) the worker knew that the statement or omission was material to obtaining the benefit; and (3) the statement or omission was made for the purpose of falsely obtaining benefits to which the worker was not entitled.”  Even then, denial is not mandatory, since the statute says only that benefits “may” be denied.  For example, where a lie has no causal connection to the injury at issue, “the courts will generally look beyond the false statement and award compensation.”

Here, the compensation judge evaluated the evidence, weighed the credibility of the witnesses, and determined that there was no violation of the anti-fraud provision.  Judge Hayden observed that some of the issues that Verizon pointed out may have been material, but the evidence did not support a conclusion that plaintiff had purposely or knowingly misrepresented or omitted facts.