|
|
Publications
Texas Appellate Court Enforces Jurisdictional Bar in Workers Compensation Bad Faith Case
Insurance Law Update
Texas Court of Appeals
In a bad faith suit brought by a workers’ compensation claimant against a third party administrator, the Texas Court of Appeals (Houston) vacated a trial court judgment awarding damages in excess of $1.5 million and dismissed the plaintiff’s claims with prejudice. In Cunningham Lindsey Claims Management, Inc. v. Snyder,___ S.W.3d ___, 2009 WL 1795022 (Tex. App. — Houston June 25, 2009), Lloyd Snyder was employed as a psychiatric nurse when he sustained an injury on October 9, 2002 as a result of a patient punching his collarbone. Cunningham Lindsey, a third party administrator, adjusted Snyder’s workers’ compensation claim.
In December 2002, Snyder’s physician requested preauthorization to perform cervical surgery. The preauthorization was denied on the ground that the surgery was not medically necessary. Within days of the denial, Cunningham Lindsey filed a notice with the Division of Workers Compensation advising it was disputing the compensability and extent of Snyder’s injury. Following a contested hearing, the hearing officer found that Snyder was injured in the course and scope of his employment, and that Snyder’s injury extended to include his cervical spine injuries. In April 2004, more than two months after the entry of the findings, Snyder’s physician made a second request for preauthorization of the cervical surgery, which was approved. Thereafter, Snyder sued Cunningham Lindsey, alleging that it unreasonably and in bad faith delayed his cervical surgery. The trial court entered a judgment awarded damages in favor of Snyder in the amount of $1.5 million.
On appeal, the Appellate Court agreed with Cunningham Lindsey that the trial court had no jurisdiction over the bad faith suit because Snyder failed to appeal the initial preauthorization denial and thus failed to exhaust his administrative remedies. The court held that Snyder waived any argument that cervical surgery was medically necessary in December 2002 by failing to appeal the preauthorization denial. The court further held that, since all of Snyder’s damages were based upon the alleged delay in the cervical surgery and therefore dependent upon a finding that Snyder required surgery in December 2002, all of the damages were based on claims outside of the court’s jurisdiction. As such, the court vacated the damages award in favor of Snyder and dismissed his claims with prejudice.
|
Related People
Related Offices
Related Practices
|