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The American Equity Underwriters, Inc. The American Equity Underwriters, Inc.
Longshore Insider
3 Strategies to Reduce Hearing Loss Claims Costs
Oct 31, 2019 - Dave Widener, The American Equity Underwriters, Inc.

Under the Longshore Act, hearing loss claims can cause much frustration for employers. Not only are they nearly impossible to prevent, but once a claim is filed, many employers will pay more than required under the Act.

Here are three strategies that employers, in partnership with their USL&H provider, can implement to reduce the cost of hearing loss claims.

 

1. Research prior claims with the U.S. Department of Labor (DOL).

Employers are entitled to a dollar-for-dollar credit for any prior permanent partial disability paid, per Strachan Shipping Co. v. Nash, 782 F.2d 513 (5th Cir. 1986). This credit is available regardless of which employer paid the prior award.

Example: Joe works as a longshoreman for Company A, files a claim for noise-induced hearing loss and is paid $2,000 in compensation for permanent partial disability. Joe then goes to work for Company B and later files a claim for a worsening of his hearing loss, which amounts to a total award of $5,000. Company B takes a credit for the previous $2,000 paid and only owes $3,000.

To determine the amount of the credit, if any, the claims adjuster obtains a privacy release from the employee to obtain prior longshore claims records from the DOL. The adjuster then sends a formal request to the DOL for any prior hearing loss claims records. Once the records are obtained, the adjuster researches any payment records, LS-208s, or settlement documents to determine the amount of compensation that will be a credit toward any further disability award.

 

2. Think twice before utilizing the claimant’s audiologist for hearing aids.

Employees are entitled to their own choice of physician for medical treatment under Section 7(b) of the United State Longshore and Harbor Workers’ Compensation Act (LHWCA, or Longshore Act). However, the Benefits Review Board (BRB, or Board) has held that employees do not have a statutory right to select their own pharmacy or provider of prescriptions, as pharmacies are not included in the definition of “physician” contained in 20 C.F.R. §702.404, and thus are not encompassed within Section 7(b)’s right to choose a physician (Potter, et al. v. Electric Boat Corp., 41 BRBS 69 (2007)).

In the context of a hearing loss claim, an employee’s audiologist may recommend high-end hearing aids or charge a markup well above the reasonable cost. In Jones v. Huntington Ingalls, Inc. (51 BRBS 29 (2017)), the claimant asserted that he had a statutory or regulatory right to his choice of audiologist that would dispense aids. Relying on Potter v. Electric Boat Corp. (41 BRBS 69 (2007)), the BRB held that audiologists are not among those defined as “physicians” under 20 C.F.R. §702.404, and, as the selection of an audiologist who will dispense hearing aids falls within the “character and sufficiency” of medical care, the issue concerning the selection of an audiologist is delegated to the DOL district director.

 

3. Minimize attorney fees by understanding fee shifting under the Act.

The Longshore Act shifts the burden to pay attorney fees from the claimant to the employer in two distinct situations:

  1. Section 28(a): “If the employer or carrier declines to pay any compensation on or before the thirtieth day after receiving written notice of a claim for compensation having been filed from the deputy commissioner, on the ground that there is no liability for compensation within the provisions of this Act, and the person seeking benefits shall thereafter have utilized the services of an attorney at law in the successful prosecution of his claim, there shall be awarded, in addition to the award of compensation, in a compensation order, a reasonable attorney's fee against the employer or carrier.”
  2. Section 28(b): “If the employer or carrier pays or tenders payment of compensation without an award pursuant to section 14(a) and (b) of this Act [33 USC § 914(a), (b)], and thereafter a controversy develops over the amount of additional compensation, if any, to which the employee may be entitled, the deputy commissioner or Board shall set the matter for an informal conference and following such conference the deputy commissioner or Board shall recommend in writing a disposition of the controversy. If the employer or carrier refuse to accept such written recommendation, within fourteen days after its receipt by them, they shall pay or tender to the employee in writing the additional compensation, if any, to which they believe the employee is entitled. If the employee refuses to accept such payment or tender of compensation, and thereafter utilizes the services of an attorney at law, and if the compensation thereafter awarded is greater than the amount paid or tendered by the employer or carrier, a reasonable attorney's fee based solely upon the difference between the amount awarded and the amount tendered or paid shall be awarded in addition to the amount of compensation.”

Basically, if the claimant hires an attorney and is successful in receiving benefits, the employer will have to pay attorney fees:

  • If they did not pay any compensation within 30 days of notice of the claim
  • If compensation was paid within 30 days and a controversy arises, or
  • The employer refuses the DOL’s recommendation or pays less than the claimant is due.

Alternatively, if the employer makes a timely initial payment and of the amount ultimately owed without controversy, the attorney can seek fees from the claimant under Section 28(c). A timely, thorough investigation will lead to timely payments and help determine which should legitimately be paid and which cases to defend against.

 

An employer’s USL&H provider can guide on practical approaches to mitigate the risk associated with hearing loss claims. These approaches should include both incident prevention and cost mitigation once a claim is filed.

ALMA members can find tools to help workers protect their hearing on the ALMA member resource website (login required). For more information on addressing hearing loss claims at your company, contact us at AEU.


ABOUT THE AUTHOR

David Widener joined AEU in 2019 as Director of Claims Advisory Services. Widener began his longshore career in 2003 with F.A. Richard/American Equity Risk Services, where he was a claims supervisor for eight years. He joined the U.S. Department of Labor as a claims examiner in 2011, and was promoted to District Director six months later, overseeing operations for the Houston District Office. David has a B.S. in finance from Louisiana State University and is a credentialed mediator for the state of Texas.


The opinions and comments expressed in this article are those of the authors and do not reflect the opinion of ALMA, AEU or AmWINS. None of ALMA, AEU, AmWINS or the authors are responsible for any inaccuracy of content or for any loss or damages incurred by any party as a result of reliance on information contained in this article. Content may not be published or reproduced without the written consent of the authors. Prior articles may not be updated for accuracy as pertinent information changes over time. The Longshore Insider is intended to provide general information about the industry and should not be construed as legal advice under any circumstances. For legal advice, please consult a licensed attorney.
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