No. 86-253 

IN THE SUPREKE COURT OF THE STATE OF MONTANA 

1987 

JOHN G. ROWEN, 

Claimant and Appellant, 

-vsSUPER VALUE STORES, INC., 

Employer, 

and 

LIBERTY MUTUAL INSURANCE COMPANY, 

Defendant and Respondent. 

APPEAL FROM: The Workers' Compensation Court, The Honorable 

Timothy Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

1,awrence A. Anderson, Great Falls, Montana 

For Respondent: 

Larry W. Jones; Garlington, Lohn & Robinson, Missoula, 

Montana 

-- 

Submitted on Briefs: Sept. 25, 1986 

Decided: November 5, 1987 

Clerk 
Mr. Justice John C. Sheehy delivered the Opinion of the 

Court. 

This case concerns a dispute between the employer's 

insurer and the injured employee over the proper procedure to 

be pursued by the insurer to obtain pretrial discovery of 

medical information regarding the compensability of the 

injured employees claim. 

We determine that such pretrial discovery of medical 

information is governed by applicable statutes and the Rules 

of the Workers' Compensation Court as herein set forth. We 

also determine that an injured employee, to sustain a right 

to Workers' Compensation benefits, must waive any privilege 

or claim of confidentiality as to medical information 

relating to the compensability of his claim. 

On February 19, 1986, John G. Bowen, through his 

counsel, filed a petition in the Workers' Compensation Court 

claiming that he had suffered an industrial injury on January 

17, 1985, in the course of his employment with Super Valu 

Stores, Inc. in Great Falls, Montana; that he had become 

totally disabled, and that he needed a lump sum award to 

assist him in retraining and rehabilitation. On February 25, 

1986, the Workers' Compensation Court set the case for trial 

during the week of June 9, 1986, and the pretrial conference 

on April 21, 1986. 

Bowen's claim is based upon kidney failure which he 

alleges came from working under extreme mental pressure which 

caused him a great amount of stress which in turn caused 

uncontrolled hypertension resulting in the renal failure. 

On March 20, 1986, the attorney for Liberty Mutual wrote 

to three hospitals, nine doctors, two clinics, and one 
transplant center similar letters which included the 

following paragraphs: 

I am the attorney representing the workers' 

compensation insurer carrier against whom John 

Bowen has filed the enclosed claim for Workers' 

Compensation benefits. Please note that the form, 

as indicated in the lower left hand corner, is also 

an authorization for release of medical records. 

Please copy your entire file on Mr. Bowen and send 

it to me by placing it in the mail no later than 

April 1, 1986. Delete absolutely no documents from 

your original file before making the copy of the 

file I have requested. Included with the copy I 

have requested any invoice for copying costs. 

In the letters which were written to the doctors, the 

foregoing paragraphs were repeated, but there was also added 

in the letters to the doctors the following: 

Please answer the following questions, based on 

your examination, testing and/or treatment of Mr. 

Bowen so that I and my client can better understand 

the exact nature of Mr. Bowen's medical condition 

and associa-ted claim for workers' compensation 

benefits. Include with your answers any bill for 

professional services provided in answering these 

questions: 

1. What is the most current diagnosis of medical 

condition or conditions for which you have treated 

or examined Mr. Bowen? 

2. Is your diagnosis based on a reasonable degree 

of medical certainty, i.e., more probable than not? 

3. What in your opinion is the cause of the 

condition or conditions you have diagnosed? 

4. If in your opinion the claimant's work was in 

any way causally related to any condition you have 

diagnosed, then please state (1) the work you 

believe the claimant was doing that is causally 

related to a condition you have diagnosed and 

(2) what that causal rel-ation is. 
5. Has each condition reached a point where it 

will not improve even though Mr. Bowen may continue 

to have some symptoms resulting from the condition, 

including pain? 

6. What are the symptoms ie, subjective 

complaints) and signs (i.e., objective findings) on 

which you relied for diagnosing each condition you 

have diagnosed? 

Copies of each of the foregoing noted letters were sent 

to the attorney for the claimant. On March 21, 1986, counsel 

for the claimant wrote to each of the medical providers a 

letter in which the key paragraph follows: 

You may have recently received correspondence from 

opposing counsel requesting medical records and 

responses to various questions. It is our position 

that Mr. Bowen does not give you authority to 

respond to that request. The Montana Rules of 

Civil Procedure and the Montana Supreme Court 

prescribe the rules by which medical information is 

disseminated in litigation. The Rules and the 

Montana Supreme Court do not authorize the 

procedure undertaken by opposing counsel. See, 

Jaap 5 District Court, Mont. - , -- 623 nd 

1389, 38 St.Rep. 280 (1981). We have accordingly 

ad~ise~opposing counsel that we object to his 

correspondence to you. 

Also on March 21, 1986, Bowen's counsel wrote to the 

attorney for Liberty Mutual, advising that on March 20, 1986, 

Bowen had undergone a kidney transplant, and further advising 

that he had instructed the treating physicians and health 

care providers not to respond to the correspondence of the 

attorney for Liberty Mutual. 

Meanwhile, on March 21, 1986, Liberty Mutual filed 

interrogatories and requests for production of documents. On 

April 1, 1986, Liberty Mutual filed a motion to vacate the 

trial setting and a motion to dismiss claimant's petition on 

the ground that the court lacked jurisdiction because Bowen 

was asserting his physician-patient privilege. 
At least one doctor and one clinic advised Liberty 

Mutual after receiving the letter from the claimant's 

attorney that they would not answer questions concerning 

Bowen's condition without specific written direction from 

Bowen. 

On April 22, 1986, the claims examiner for the Workers' 

Compensation Court entered an order vacating the trial 

setting and ruling that the matter would not appear on the 

court calendar for trial until the court received 

confirmation that every medical provider contacted by Bowen's 

counsel had received written instructions to conform to the 

rulings of the Workers' Compensation Court and that such 

medical records had been provided to defendant's counsel in 

sufficient time to prepare for trial. In the same order the 

hearings examiner denied Liberty Mutual's motion to dismiss. 

Bowen moved for reconsideration of the hearings 

examiner's order. The Workers' Compensation judge, after 

receiving briefs, denied reconsideration, thus keeping in 

effect both the examiner's orders vacating the trial date and 

denying dismissal of the action. This appeal followed from 

both sides. 

Neither side has discussed except incidentally whether 

this Court has jurisdiction to hear this appeal. Section 

39-71-2904, MCA, grants a right of appeal from a "final" 

decision of the Workers' Compensation judge to the Montana 

Supreme Court. An order refusing to dismiss a cause is not 

ordinarily appealable. The order vacating the trial date is 

not on its face a final order but the effect of the order is: 

if we were to deny jurisdiction, Bowen would in effect give 

up his right of appeal in order to get his case tried. When 

the effect of the order is to destroy the appellant's right 

of appeal if he complies, the order, even though 

interlocutory, should be appealable. " . . . finality of an 
. . . order depends upon the nature of the order rather than 

its chronology. . . " Northern Plains Resource Council v. Bd 

of Natural Resources (1979), 181 Mont. 500, 515, 594 P.2d 

297, 306. 

The critical issue in this appeal arises from the 

procedure adopted by Liberty Mutual to obtain medical 

information, and the reaction of Bowen asserting a right of 

privilege against the procedure. Liberty Mutual claims that 

when Bowen asserted the physician-patient privilege his 

action prevented the Workers' Compensation Court from 

determining his physical condition before and after the 

industrial accident and that this has the effect of removing 

his claim from the jurisdiction of the Workers' Compensation 

Court. Bowen, on the other hand, contends that discovery 

procedures in the Workers' Compensation Court are controlled 

hy the Montana Rules of Civil Procedure, particularly Rule 

35, and that under JAAP v. District Court (Mont. 1981), 623 

P.2d 1389, 1390, 38 St.Rep. 280, private interviews between 

counsel for one party and possible adversary witnesses may 

not be granted. 

Both parties, it appears, have overlooked the applicable 

provisions. 

First, we examine the basis for the Workers' 

Compensation Court's decision. It is found in the order of 

the hearings examiner, which the Workers' Compensation Court 

refused to reconsider, that "defendant's motion to vacate the 

trial date is GRANTED on the grounds that the claimant has 

refused to comply with the free exchange of medical 

information required under Rule 24.29.1404(3) A.R.M. . . ." 

The portion of Rule 24.29.1404, A.R.M. relied on by the 

hearings examiner follows: 
(3) The rule of privileged communication is waived 

by the injured worker seeking benefits under the 

Workers' Compensation or Occupational Disease Acts. 

Overlooked in the order was the fact that Rule 

24.29.1404 is a rule promulgated by the Workers' Compensation 

Division and not by the Workers' Compensation Court. The 

Division and the Court are separate entities. Neither has 

control the other , and particularly their rules are 

separate and stem from different sources of authority. 

Section 2-15-1014, MCA, establishes the office of the 

Workers' Compensation judge. It provides in part: 

(1) There is the office of Workers' Compensation 

Judge. The office is allocated to the Department 

of Administration for administrative purposes only 

as prescribed in 2-15-121. 

Under our law, when an agency is allocated to a 

department for administrative purposes the agency 

nevertheless acts independently of the department. Section 

2-15-121, MCA, states in part: 

(1) An agency allocated to a department for 

administrative purposes only in this chapter shall: 

(a) exercise its quasi-judicial, quasilegislative, licensing and policy making functions 

independently of the department and without 

approval or control of the department; 

(2) The department to which an agency is allocated 

for administrative purposes only in this title 

shall: 

(e) Print and disseminate for the agency any 

required notices, rules, or orders adopted, 

amended, or repealed the agency. (~m~hasis 

added. ) 
It is clear from S 2-15-121, MCA, that the Workers' 

Compensation judge as an agency allocated to the Department 

of Administration for administrative purposes, nonetheless is 

completely independent of the Department in the exercise of 

its quasi-judicial functions. The rules adopted by the 

Department, in this case the Division, have no application to 

proceedings before the Workers' Compensation Court. We must 

look to another source for rules to be applied in that court. 

That source is found in $ 39-71-2903, MCA and subsequent 

administrative rules adopted by the Workers' Compensation 

Court. 

Section 39-71-2903, MCA, provides: 

All proceedings and hearings before the workers' 

compensation judge shall be in accordance with the 

appropriate provisions of the Montana 

Administrative Procedure Act. The workers ' 

compensation judge is bound by common law and 

statutory rules of evidence. 

As an administrative agency, the Workers' Compensation 

Court is given the authority to adopt rules of practice. In 

S 2-4-201, MCA, we find: 

In addition to other rulemaking requirements 

imposed by law, each agency shall: 

(2) Adopt rules of practice, not inconsistent with 

statutory provisirns, setting forth the nature and 

requirements of all formal and informal procedures 

available, includins a description of all forms and 

instructibns used b; the agency. (~mphasis added.) 

Pursuant to the power of law vested in the Workers' 

Compensation judge in $5 2-4-201, MCA, the Workers' 

Compensation Court has adopted rules of practice and 

procedures in matters handled by it. They will be found, 

beginning at page 245, in the Montana Rules of Court (1987 

Desk Copy) published by West Publishing Company. The 
FJorkers' Compensation Court has adopted rules of pretrial 

discovery. They are found in Rule 2.52.322, Depositions; 

Rule 2.52.323, Interrogatories; Rules 2.52.324, Motions - to 

Produce; Rule 2.52.325, Limiting Discovery; and Rule 

2.52.326, Sanctions for Failure -- to Make Discovery. The only 

provision of the Procedural Rules of the Workers' 

Compensation Court relating specifically to medical records 

is Rule 2.52.317 which follows: 

(1) Prior to any scheduled trial, the parties 

shall exchange all medical records based upon 

examination of the claimant. Failure to exchange 

such materials on a timely basis before trial shall 

preclude its use at trial. Medical records will 

only be accepted by the court as evidence if 

stipulated to by the parties or by the laying of 

proper foundation. 

Aside from the duties of the parties to exchange medical 

records based upon the examination of the claimant found in 

Rule 2.52.317 of the Procedural Rules of the Workers' 

Compensation Court, we find no statement in any of the Rules 

that a Workers' Compensation claimant by making a claim 

thereby waives the physician-patient privilege. We turn, 

therefore, to the statutes adopted by the legislature to 

determine what they provide on this subject. 

The physician-patient privilege itself is found in S 

26-1-805, MCA, which provides: 

Except as provided in Rule 35, Montana Rules of 

Civil Procedure, a licensed physician, surgeon, or 

dentist cannot, without the consent of his patient, 

be examined in a civil action as to any information 

acquired in attending the patient which was 

necessary to enable him to prescribe or act for the 

patient. 

There is no direct statement in the Workers' 

Compensation Act that a claimant waives the physician-patient 
privilege. Waiver may be implied, however, from certain 

provisions of the statutes which follow: 

Section 39-71-604. (1) Where a worker is entitled 

to benefits under this chapter, the worker shall 

file with the insurer or the division all 

reasonable information needed by the insurer to 

determine compensability. It is the duty of the 

workers' attending physician to lend all necessary 

assistance in making application for compensation 

and such proof of other matters as may be required 

by the rules of the division without charge to the 

worker. The filing of forms or other documentation 

by the attending physician does not constitute a 

claim for compensation. 

Section 39-71-605. (1) (a) Whenever in case of 

injury the right to compensation under this chapter 

would exist in favor of any employee, he shall, 

upon the written request of the insurer submit from 

time to time to examination by a physician or panel 

of physicians, who shall be provided and paid by 

such insurer, and shall likewise submit to 

examination from time to time by any physician or 

panel of physicians selected by the division. 

(b) . . . The employee shall be entitled to have 

a physician present at any such examination . . . . any physician or panel of physicians employed by 

the insurer or the division who shall make or be 

present at any such examination may be required to 

testify as to the results thereof. 

(There is a further provision for examination by a panel 

of physicians in S 39-71-605 (2) , MCA.) 

At the time that this matter arose in the Workers' 

Compensation Court, the provision of SS 50-16-301 to -314 

inclusive, were in force and effect. Those statutes have 

since been repealed by the legislature (Ch. 632, Laws of 

Montana (1987) ) and the Uniform Health Care Information Act 

was enacted in their place. Sections 50-16-501, et seq. 

While it could be argued that under former S 50-16-311 (e) , 

MCA, an employer or his Workers' Compensation insurer could 

receive reasonably necessary information from a health care 
provider, it was equally clear that under former § 50-16-314, 

MCA, confidential health information was not subject to 

compulsory legal process in any type of proceeding, including 

any pretrial or preliminary proceedings unless required by 

Rule 35, Montana Rules of Civil Procedure, or otherwise 

ordered by a court. 

Even though the statutes referred to have been repealed, 

it is now necessary for us to examine the situation under the 

Uniform Health Care Information Act, since its provisions 

will apply to future proceedings in this cause in the 

Workers' Compensation Court and to other proceedings there. 

The pertinent sections of the Uniform Health Care 

Information Act are: 

50-16-525. Disclosure by health care provider. 

(1) Except as authorized in 50-16-529 and 

50-16-530 or as otherwise specifically provided by 

law or the Montana Rules of Civil Procedure, a 

health care provider, an individual who assists a 

health care provider in the delivery of health 

care, or an agent or employee of a health care 

provider may not disclose health care information 

about a patient to any other person without the 

patient's written authorization. A disclosure made 

under a patient's written authorization must 

conform to the authorization. 

50-16-535. When health care information available 

b~ compulsory process. Health care information may 

not be disclosed by a health care provider pursuant 

to compulsory legal process or discovery in any 

judicial, legislative, or administrative proceeding 

unless: 

(3) The patient is a party to the proceeding and 

has placed his physical or mental condition in 

issue;. . . 

50-16-536. Method - of compulsory process.. . . 
(2) Service of compulsory process or discovery 

requests upon a health care provider must be 

accompanied by a written certification, signed by 

the person seeking to obtain health care 

information or his authorized representative, 

identifying at least one subsection in 5 50-16-535 

under which compulsory process or discovery is 

being sought . . . a person may sign the 

certification only if the person reasonably 

believes that the subsection of 50-16-535 

identified in the certification provides an 

appropriate basis for the use of discovery or 

compulsory process . . . 

What the legislature has given under S 50-16-536 (2) , 

MCA, it has apparently taken away under subdivision 3: 

(3) Production of heatlh care information under 

50-16-535 and this section does not in itself 

constitute a waiver of any privilege, objection, or 

defense existing under other law or rule of 

evidence or procedure. 

It is our duty, from the morass of statutes and rules 

foregoing, to distill such a contruction of the statutes and 

rules as to give effect to all. Section 1-2-101, MCA. 

The statute most clearly authorizing Bowen's health care 

providers to give confidential health information respecting 

him to Liberty Mutual's attorney following his letter to 

them, without Bowen's consent, is § 50-16-535(3), MCA. hat 

information, however, under the terms of that statute and 5 

50-16-536, MCA, can be obtained only by compulsory process or 

discovery. 

Clearly, the March 20, 1986, letter from the attorney 

for Liberty Mutual to Bowen's medical providers was too 

broad. The letter demanded from each provider not just the 

information relating to the compensability of Bowen's claim, 

but copies of the "entire file," without regard to relevance. 

The procedure adopted by Liberty Mutual's attorney for 

pretrial discovery is not found in any of the rules of 
practice of the Workers' Compensation Court or other 

applicable statutes. The best, shortest and cheapest 

procedure for pretrial medical discovery is for the 

respective parties to cooperate in the procurement and 

exchange of relevant medical information relating to 

compensability. If such cooperation is not possible, then, 

in Workers' Compensation cases, the rules of pretrial 

discovery adopted by the Workers' Compensation Court come 

into play. Under Rule 2.52.323, interrogatories may be 

served upon the adverse party (not upon a health provider who 

is not an adverse party). Likewise, under Rule 2.52.324, 

motions to produce may be served upon the "adverse party." 

With respect to persons not a party to the action who may 

also be health care providers, the procedure to be followed 

is to take depositions upon oral examination. Rule 2.52.322. 

In this case, subpoenas addressed to the nonparty may be 

issued under Rule 2.52.331, and materials in the possession 

of the nonparty can be reached through a subpoena duces 

tecum. Rule 2.52.322 (2). 

At all times, the Workers1 Compensation Court may limit 

discovery as provided in Rule 2.52.325. 

As we construe the Workers' Compensation statutes, the 

statutes relating to the patient-physician privilege, the 

provisions of former 55 50-16-311 and 50-16-314, and the new 

Uniform Health Care Information Act, we determine that 

Liberty Mutual is entitled to confidential health care 

information from the medical providers relating to the 

compensability to Bowen's claim. When Bowen' s attorney 

objected and raised the privilege, he was acting in 

conformance with former 50-16-314, MCA, and new 5 

50-16-525, MCA. 

Under 5 39-71-604, MCA, Bowen in this case has a duty to 

file with the insurer and with the court all reasonable 
information needed by the insurer and the court to determine 

compensability. Bowen has a duty therefore through the use 

of depositions, or medical reports obtained from such health 

care providers to carry his burden of proof of 

compensability. Such examination reports which relate to 

compensability as are in Bowen's possession, or in his 

attorney's possession are to be freely exchanged with the 

insurer and his counsel under Rule 2.52.317 of the Procedural 

Rules of the Workers' Compensation Court. Bowen is likewise 

entitled to an exchange of reports from Liberty Mutual. 

Liberty Mutual has the right to require an examination 

of Bowen by its own attending physician or physicians under 5 

39-71-605, MCA. 

Rules adopted by the Workers' Compensation Division as 

distinguished from the 'Workers' Compensation Court have no 

application in the Workers' Compensation Court. Since 

discovery may be necessary beyond the exchange of exhibits by 

the parties, it should be governed by the rules of practice 

adopted by the Workers' Compensation Court, to which rules we 

have heretofore adverted. Anything in the declaratory ruling 

filed February 13, 1985 by the Workers' Compensation Court in 

docket No. 8412--728, entitled Parker v. Central Montana 

Hospital and Nursing Home (unpublished) inconsistent with 

this opinion is overruled. 

In order to clarify the statutes and rules, we hold that 

a claimant for Workers' Compensation benefits waives any 

privilege of confidentiality and health care information 

which is relevant to the subject matter involved in his 

claim. If as in this case, a Workers' Compensation benefits 

claimant exercises his right under S§ 26-1-805 or 50-16-525, 

MCA, to prevent any medical witness from disclosing 

confidential health information, and subsequently application 

is mad.e by the adverse party to the Workers' Compensation 
Court for an order authorizing such discovery, the Workers' 

Compensation Court should authorize such discovery as is 

relevant to the subject involved in the pending action. It 

should not be a ground for an objection that the information 

sought will be inadmissible at the trial if the information 

sought appears reasonably calculated to lead to the discovery 

of admissible evidence, but the information obtained must be 

reasonably necessary to determine compensability. The 

protection for the claimant in such case from too broad 

discovery lies in the provision of Rule 2.52.317 and Rule 

2.52.326 of the Procedural Rules of the Workers' Compensation 

Court and in our decision in Hert v. J. J. Newberry (1978), 

179 Mont. 160, 587 P.2d 11. 

We find no merit in the cross appeal to the effect that 

the Workers' Compensation Court has no jurisdiction of this 

cause. 

Accordingly, we reverse the order of the Workers' 

Compensation Court that no further trial date will be set in 

this case, and remand for further proceedings in accordance 

with this Opinion. Costs to Bowe 

Justice