IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Mark W. Sheaffer, :

: No. 783 C.D. 2016

Petitioner : Submitted: September 23, 2016

:

v. :

:

Workers' Compensation Appeal :

Board (Standard Steel, LLC), :

:

Respondent :

BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge

HONORABLE MICHAEL H. WOJCIK, Judge

HONORABLE JAMES GARDNER COLINS, Senior Judge

OPINION NOT REPORTED

MEMORANDUM OPINION 

BY JUDGE WOJCIK FILED: February 14, 2017

Mark W. Sheaffer (Claimant) petitions for review of the April 15, 

2016 order of the Workers’ Compensation Appeal Board (Board), which affirmed

the July 1, 2015 decision and order of Workers’ Compensation Judge Michael 

Kroll (the WCJ), confirming and documenting that Standard Steel, LLC and its 

insurer (together, Employer) obtained approval of a Workers’ Compensation 

Medicare Set-Aside account from the Centers for Medicare and Medicaid Services 

(CMS); incorporating an Addendum to the parties’ Compromise and Release 

Agreement (C&R) submitted by Employer; and confirming the conclusion of 

Employer’s responsibility for any future workers’ compensation payments related 

to Claimant’s May 19, 2009 work injury. We affirm. 
2

On May 19, 2009, Claimant sustained a work-related injury in the 

nature of a herniated disc at L2-3. Reproduced Record (R.R.) at 16a. The parties 

entered into a C&R on December 16, 2014,

1

agreeing that payment of $190,000 

represented payment of all past, present, or future wage loss benefits. R.R. at 17a18a. With respect to medical benefits,2

the parties agreed as follows:

Claimant is receiving Social Security and Medicare. As 

for medical benefits, the Claimant retains his rights to 

medical benefits, as such, [Employer] retain[s] all rights 

concerning medical benefits also, including but not 

limited to, the right to file a UR, Challenge medical bills, 

defend against Fee Review Applications, obtain IMEs, 

etc. The parties are seeking a Workers’ Compensation 

Medicare Set Aside Account [WCMSA] approval from 

[CMS]. As an express term of this agreement, Claimant 

agrees to [cooperate] with [Employer] in [its] efforts [to] 

obtain CMS approval of a WCMSA; once CMS approves 

a WCMSA, [Employer] will have at [its] sole discretion 

the option to either fully fund the WCMSA via an 

annuity or by other means or to keep the Claimant’s WC 

medical benefits open. 

 

1

The C&R was approved by decision and order of WCJ Geoffrey Russell dated 

December 22, 2014.

2 When a claimant is entitled to Medicare payments or may be entitled to Medicare 

payments in the future, workers’ compensation agreements settling future medical benefits must 

adequately consider Medicare’s interests. 42 U.S.C. §1395y(b)(2); 42 CFR §§411.46, 411.47, 

and 411.21. The recommended method to protect Medicare’s interests is a Workers’ 

Compensation Medicare Set Aside Account, a financial agreement that allocates a portion of a 

workers’ compensation settlement to pay for future medical services related to the work injury, 

illness, or disease. Department of Health & Human Services, Centers for Medicare & Medicaid 

Services, Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference 

Guide, Version 2.5, Rev. April 4, 2016. https://www.cms.gov/Medicare/Coordination-ofBenefits-and-Recovery/Workers-Compensation-Medicare-Set-Aside-Arrangements/WCMSAOverview.html (last visited January 27, 2017).
3

C&R, par. 13, R.R. at 17a. In his decision approving the C&R, WCJ Russell found 

and concluded that Claimant understood the full legal significance of the C&R and 

entered into it knowingly and voluntarily. R.R. at 12a-15a.

On April 16, 2015, Employer filed a petition to “Seek Approval of a

Compromise and Release Agreement (ask Judge to approve settlement),” 

indicating that the parties had agreed to resolve Claimant’s medical benefits, 

pursuant to Section 449 of the Workers’ Compensation Act (Act).3 Claimant’s 

counsel advised the WCJ that there was no such agreement, and the WCJ held a 

telephone hearing on June 9, 2015.

During the hearing, the parties agreed that in lieu of a second C&R, 

Employer would submit documentation and the WCJ would issue an order 

confirming that Employer exercised its option pursuant to the original C&R and 

fully funded the set aside account. 

[WCJ]: [I]s there actually a need based upon the prior 

[C&R] to have a separate C&R . . . ? I know there [are] a 

lot of occasions where I will see the parties simply enter 

into the first agreement and then fund the Medicare Set 

Aside, stop payment of their medical benefits consistent 

with the initial agreement, and then go from there.

[Employer’s counsel]: Yes, I mean it’s my customary 

practice to do, at least it’s customary to my practice to do 

a second C&R, but you’re right. . . . I don’t know, I mean 

if [Claimant’s counsel]’s not objecting to it, if you want 

to just issue an order, I can submit the CMS letter and we 

can submit everything and you can issue [an] order and 

say, hey, they exercised their option, they fully funded it 

as per the other C&R . . . . 

 

3 Act of June 2, 1915, P.L. 736, as amended, added by the Act of June 24, 1996, P.L. 350, 

77 P.S. §1000.5, which provides in part that a C&R “must be explicit with regard to the payment, 

if any, of reasonable, necessary and related medical expenses.” 
4

* * *

[WCJ] If you want to go ahead and confirm the 

submission in payment of the amounts in question and 

then submit that document, to upload that documentation, 

I would have no issue in essentially entering an order that 

can be basically very short that the parties entered into an 

agreement approved by [WCJ Russell] December 22nd 

and that’s Judge’s Exhibit One. The parties filed a C&R 

but rather than proceed with an additional hearing, 

[Employer has] submitted documentation confirming that 

they have fully obtained Medical Set Aside approval, 

fully funded the amount with proof of payment and that 

the medical portion of this case is now resolved by way of 

the initial C&R and subsequent funding of a Medicare 

Set Aside amount. That simple. 

R.R. at 59a-60a (emphasis added) 

Claimant’s counsel expressly consented:

[Employer’s counsel]: Jack, do you have an objection to 

that?

[Claimant’s counsel]: No, it’s almost an administerial 

(sic) function, I suppose.

Id. 

The WCJ continued the matter for thirty days. Id. Thereafter, 

Employer submitted a copy of the WCMSA, documentation of CMS approval and 

an addendum to Paragraph 13 of the C&R. R.R. at 34a-35a. By decision and 

order dated June 30, 2015, the WCJ adopted and approved the Addendum as fair 

and equitable and as confirmation of the conclusion of Employer’s responsibility 

related to Claimant’s May 19, 2009 work injury. 

Claimant then appealed to the Board, asserting that: Employer wrote 

to the WCJ on June 27, 2015, requesting an order adopting an addendum to 

paragraph 13 of the previously approved C&R; the WCJ received that 
5

correspondence of June 29, 2015; on June 29, 2015, Employer faxed additional 

documentation to the WCJ and mailed a copy of his June 27th correspondence to 

Claimant’s counsel, who received it on July 1, 2015; and, without providing 

Claimant an opportunity to object or offer evidence, the WCJ admitted the 

documents and issued an order on July 1, 2015, declaring that Employer’s 

resolution of all workers’ compensation responsibility was concluded as of June 

30, 2015. Claimant argued that the WCJ’s decision is a product of an ex parte 

communication with Employer and acceptance of documents that were provided ex 

parte, that the WCJ should have dismissed Employer’s petition because there was 

no agreement, and that Claimant did not have an opportunity to object or provide 

testimony. 

The Board rejected these arguments, stating that there was no 

evidence of an improper ex parte communication, the documents submitted by 

Employer were the documents agreed upon at the June 9, 2015 hearing, and

Claimant’s attorney specifically declined an opportunity for a further hearing on 

the matter. Accordingly, the Board affirmed the WCJ’s decision, and Claimant 

continues these arguments on appeal to this Court.4 

Claimant contends that the Board erred in concluding that the original 

C&R contemplated a modification of its terms without providing him notice and an 

opportunity to object or provide testimony concerning his understanding of the 

agreement. Claimant also argues that the Board erred in determining that the 

documents submitted to the WCJ were not ex parte communications and in 

 

4 Our scope of review is limited to determining whether constitutional rights were 

violated, whether the adjudication is in accordance with the law, or whether the necessary 

findings of fact are supported by substantial evidence. Milner v. Workers’ Compensation Appeal 

Board (Main Line Endoscopy Ctr.), 995 A.2d 492, 495 n.2 (Pa. Cmwlth. 2010).
6

concluding that he waived any due process rights to object to a decision based on 

those documents. Each of these arguments rests on Claimant’s assertion that the 

WCJ’s July 1, 2015 order changed the terms of the previously approved C&R. 

Employer responds that, rather than reflecting a modification of the 

original C&R or a new agreement between the parties, the order adopting and 

approving the Addendum to Paragraph 13 simply recognized that the condition 

contemplated in the original C&R, CMS approval of the WCMSA and Employer’s 

decision to fund the WCMSA, had occurred. Additionally, Employer notes that 

Claimant voiced no objection to the WCJ’s proposal during the June 9, 2015 

hearing. We agree with Employer. 

The record is clear that, as an express term of the original C&R, 

Claimant agreed to cooperate with Employer in its efforts to obtain CMS approval 

of a WCMSA, and Claimant further agreed that once CMS approved the set-aside 

account, Employer would have, at its sole discretion, the option to either fully fund 

the WCMSA via an annuity or other means or keep Claimant’s entitlement to 

medical benefits open. R.R. at 17a. Claimant’s arguments concerting ex parte 

communications and due process also are belied by the record, which reflects that 

Claimant’s counsel specifically and unequivocally agreed to the ensuing 

procedure.

Accordingly, we affirm.

MICHAEL H. WOJCIK, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Mark W. Sheaffer, :

: No. 783 C.D. 2016

Petitioner : 

:

v. :

:

Workers' Compensation Appeal :

Board (Standard Steel, LLC), :

:

Respondent :

O R D E R

AND NOW, this 14th day of February, 2017, the order of the 

Workers’ Compensation Appeal Board, dated April 15, 2016, is AFFIRMED.

__________________________________

MICHAEL H. WOJCIK, Judge