Receiving Medicaid Benefits for Surgery doesn’t Prevent Workers’ Compensation Claim

Boise, ID (WorkersCompensation.com) -- If someone receives Medicaid benefits to pay for surgery, does that rule out a case for workers' compensation benefits.

Not according to Idaho's top court in Thompson v. Burley Inn, Inc., No. 49940 (Idaho 04/02/24), which applied a state law doctrine to rule that a worker's Medicaid status didn't impact her ability to bring a workers' compensation claim.

A worker tripped over a stack of mats on her way to a freezer on the job. As she caught herself on a metal food preparation table mid-fall, she experienced a sharp pain her low back/upper left buttock area.

Initially diagnosed with a lumbar strain, but physical therapy, nonsteroidal anti-inflammatory medications, muscle relaxants, and narcotic pain relievers did not improve her symptoms after two months, the worker was referred to a physician. The worker then underwent surgery on her hip.

Get what you need on compliance in Idaho from Simply Research

Despite the surgery, the worker's pain continued, and a hip replacement was suggested for her, but the doctor her performed an independent medical examination on her disagreed. According to the IME doctor:

(1) The worker's symptoms were coming from her back, not her hip.
(2) Her pain was caused by a preexisting condition, not her workplace fall.
(3) The degree of degenerative change in her hip did not warrant a hip replacement.

Based on this IME, the carrier denied the claim. Nonetheless, the worker underwent surgery that was covered by Medicaid and filed a complaint with the Industrial Commission.

At a hearing, the referee determined that the worker suffered a hip injury in her workplace fall and applied the "full invoice" doctrine from Neel v. Western Const., Inc., 206 P.3d (Idaho 2009), which maintains that employers and sureties must pay the full invoiced amount of a workers' compensation claim when:

(1) The surety denies the claim.
(2) The claim is later deemed compensable by the commission.

The employer appealed to the Idaho Supreme Court, arguing that because Medicaid paid for the surgery, the Neel doctrine should not apply as it would amount to an unintended windfall to an injured worker.

The court explained that excluding Medicaid recipients from the Neel doctrine would undermine Idaho's workers' compensation law as it could induce employers to deny workers' compensation claims of workers they suspect of being Medicaid recipients.

"The problem is compounded because, unlike other types of non-industrial insurance, Medicaid eligibility is determined by income," the court explained. "A person's Medicaid eligibility is not difficult for an employer to predict because employers know how much they pay their employees and whether those employees have access to independent health insurance—perhaps subsidized by the employer."

As a result, the court upheld the commission's decision.

Share This Article: