NO. 93-043

IN THE SUPREME COURT OF THE STATE OF MONTANA

1993

MICHELLE CHAPMAN,

Claimant and Appellant,

-vsRESEARCH COTTRELL,

Employer,

and

NATIONAL UNION FIRE LOSS OF PITTSBURGH,

Defendant and Respondent.

APPEAL FROM: workers' Compensation Court

The Honorable Timothy Reardon, Judge presiding.

COUNSEL OF RECORD:

For Appellant:

Don Edgar Burris, Attorney at Law, Billings,

Montana

For Respondent:

William J. Mattix; Crowley, Haughey, Hanson, Toole

& Dietrich, Billings, Montana

Filed:

Submitted on Briefs: May 27, 1993

Decided: July 13, 1993
Justice John Conway Harrison delivered the Opinion of the Court.

This is an appeal from an order of the Workers' Compensation

Court, denying appellant's claims for medical payments, statutory

penalties, costs,, and attorney's fees. We affirm.

Appellant Michelle Chapman (Chapman) was injured on May 16,

1989, while in the course and scope of her employment as a laborer

for Research Cottrell at Colstrip, Montana. She fell twelve feet

from a cooling tower and sustained injuries to her right arm and

shoulder and to her neck and back. The insurer has paid temporary

total disability benefits to Chapman since May 25, 1989. At the

time this appeal was filed she was 24 years old and had not

returned to work.

In June 1989, Dr. Richard Nelson, a neurologist, diagnosed

Chapman's injuries as cervical and lumbosacral sprain. At first,

the insurer refused to pay for Dr. Nelson's services, on the

grounds that it had not authorized this treatment. Chapman filed

a petition with the Workers’ Compensation Court, which determined

that the insurer was not liable for services rendered by Dr.

Nelson. We reversed the Workers' Compensation Court because the

evidence demonstrated that Dr. Nelson should be recognized as

Chapman's treating physician, pursuant to A.R.M. 24.29.1403.

Chapman v. Research Cottrell (1991), 248 Mont. 353, 811 P.2d 1283.

Dr. Nelson is still Chapman's treating physician. He has

referred her to other specialists, including Drs. Thomas Johnson

and Robert Snider, orthopedic surgeons. These doctors referred

Chapman for physical therapy in January 1990. She was evaluated at

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the Physical Therapy and Sports Medicine Center in Billings on

January 10, 1990, and for the next eight months was treated at the

Center with moist heat, ultrasound, and resistance exercises.

Therapy was administered by Susan Zimmerman, an occupational

therapist.

In August 1990, Chapman began an independent exercise program

at the Billings YMCA. Zimmerman testified that Chapman had a

prescription for this program, though she could not recall who had

written it, and that she had designed the exercise program, which

consisted of water exercises, free weights, and some Nautilus

equipment. In September and October, 1990, Zimmerman testified,

Chapman visited the Physical Therapy and Sports Medicine Center to

use an "upper body ergometer" prescribed by Dr. Snider. Zimmerman

had no records showing that Chapman had visited the Center or used

the upper body ergometer between October 1990 and July 1991. The

insurer paid all the costs of Chapman's therapy during this period,

including the cost of her YMCA membership.

In July 1991, Chapman moved briefly to Florida, where her

mother lived. Her lawyer notified the insurer's adjusting agent,

Crawford and Company (Crawford) in June that Chapman was moving to

Florida. H e enclosed a prescription from Dr. Nelson for

continuation of her swim therapy. In September 1991, Chapman's

lawyer wrote again to Crawford, stating that Chapman had not been

able to continue her therapy because "there has been no approval

for use of gym facilities in Florida." Later that month, Crawford

received a bill from a health club in Crystal River, Florida, for

four months membership for Chapman. Crawford paid this bill in

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November 1991, but by then Chapman had returned to Montana without

using the health club.

Dr. Nelson saw Chapman on November 21, 1991, and reported in

his notes that she had not been doing well, due to increasing

stiffness of her neck and shoulder. He stated that she needed

"about six months therapy with a program of exercise" and wrote a

new prescription for water exercise, mentioning the YMCA

specifically. The Billings YMCA, however, refused to give Chapman

a membership without six months payment in advance. Chapman's

lawyer forwarded the prescription to Crawford for authorization and

payment, but without specifying the amount due. In December he

sent Crawford the YMCA's bill for $290, covering six months

membership. Crawford responded by stating that the insurer would

pay for a physical therapy program only if it were supervised by a

registered physical therapist.

Dr. Nelson examined Chapman again on January 31, 1992. His

notes indicate that she "has not had any swimming or physical

therapy programs . . . at the Y which we had previously asked for,"

and that she was still experiencing pain and a restricted range of

motion with her right arm. He concluded that "the patient requires

a formal and active program of intervention with swim therapy,

walking, stretching, whirlpool and jacuzzi and a deep massage

program."

On March 5, 1992, Chapman filed a petition for hearing in the

Workers' Compensation Court, complaining that the insurer had

unreasonably refused payment for her therapy at the health club in

Florida and at the Billings YMCA after she returned from Florida.

4
A hearing was held on May 12, 1992, on the issues of what

constitutes reasonable medical treatment in terms of physical

therapy and whether the insurer was liable for the 20 percent

penalty authorized by 3 39-71-2907, MCA (1987), and for costs and

attorney's fees. Occupational therapist Susan Zimmerman was the

only witness who testified. The hearing examiner eventually

decided all three issues in favor of the insurer.

In the meantime, Chapman returned to Zimmerman on March 13,

1992. Zimmerman provided eight treatments and then enrolled her in

a swim therapy program at Rocky Mountain College, prescribed by Dr.

Nelson on April 2, 1992. The insurer paid the costs of the

treatment and the swim therapy program.

On July 2, 1992, the insurer advised Chapman that it would pay

for a "structured, monitored physical therapy program" and that

such a program was available through Health Partners, which is

sponsored jointly by the Billings YMCA and the Deaconess Medical

Center of Billings. Apparently in response to this letter, Chapman

enrolled in Health Partners in July, but without notifying the

insurer. In September, Health Partners notified the insurer that

Chapman had completed two months of therapy and would no longer

need the supervision of a physical therapist. The insurer paid the

cost of the supervised therapy with Health Partners and authorized

an extended conditioning program that would allow Chapman to work

more independently but with periodic review by a physical

therapist.

The Workers' Compensation Court adopted the hearing examiner's

findings of fact and conclusions of law and entered judgment on

5
December 24, 1992. It determined that Chapman was not entitled to

medical payments for the YMCA membership prescribed by Dr. Nelson

in November 1991, and that she was not entitled to statutory

penalties or to costs and attorney's fees. Chapman appealed.

The issues raised by Chapman on appeal are the same as those

addressed by the Workers ' Compensation Court in May 1992. We have

restated them as follows:

1 . Whether Chapman's proposed exercise at the health club in

Florida and at the Billings YMCA constituted reasonable

physical therapy, compensable as a reasonable and necessary

medical expense under 5 39-71-704, MCA (1987).

2 . Whether the Workers' Compensation Court erred in denying

Chapman a 20 percent penalty under § 39-71-2907, MCA (1987).

3 . Whether the Workers' Compensation Court erred in denying

Chapman costs and attorney's fees.

Two standards of review govern our decision in this case.

First, we will not overturn factual findings of the Workers'

Compensation Court if they are supported by substantial, credible

evidence in the record. Field v. Sears, Roebuck & Co. (Mont.

1993), 847 P.2d 306, 310, 50 St.Rep. 166, 168. Second, we will

uphold the court's conclusions of law if its interpretation of the

law is correct. Plooster v. Pierce Packing Co. (Mont. 1993), 846

P.2d 976, 978, 50 St. Rep. 59, 60; Steer, Inc. v. Dep't of Revenue

(1990) I 245 Mont. 470, 474-75, 803 P.2d 601, 603.

Did Chapman's proposed exercise at the health club in Florida

and at the Billings YMCA constitute reasonable physical therapy,

compensable as a reasonable and necessary medical expense under §

39-71-704, MCA?

6
The Workers' Compensation Court concluded that as the insurer

eventually paid for a health club membership in Florida, the only

dispute between the parties was whether the "two month unsupervised

YMCA membership" prescribed by Dr. Nelson was "reasonable physical

therapy" for which the insurer should pay. The court also

concluded that Chapman was not entitled to a medical payment for

the "two months of unsupervised YMCA membership prescribed by her

physician on November 21, 1991, which [Chapman] failed to use."

These conclusions were based on the following findings of fact:

7 . Claimant returned to Billings from Florida and on

November 21, 1991, she was again examined by Dr. Nelson.

. . . Dr. Nelson gave claimant a prescription for six

months of exercise therapy at the Billings YMCA. . . .

8. Dr. Nelson examined claimant again on January 31,

1992. He noted that she had not carried out his request

for an unsupervised exercise program at the YMCA, so he

prescribed a formal and active physical therapy program.

Claimant was not deposed and she failed to appear at

trial which made it difficult to judge her credibility or

to fully understand why she failed to appear at the YMCA

for the exercise program prescribed by Dr. Nelson on

November 21, 1991. After her January 31, 1992 visit, she

did participate in the supervised program of occupational

therapist Susan Zimmerman, which defendant accepted and

paid.

The Workers' Compensation Court apparently misread the record

in characterizing the case as a dispute between Chapman and the

insurer over "two months of unsupervised YMCA membership.1' Chapman

requested payment for a six-month YMCA membership in December 1991.

This membership presumably would have provided therapy for her

through June 1992, but the insurer refused to pay for that

membership and did not pay for any therapy until March 1992, when

Chapman resumed treatment under Zimmerman's supervision. Chapman

therefore had no access to the prescribed water exercise or to any

7
therapeutic program from the time Dr. Nelson saw her in November

1991 until she went back to Zimmerman on March 13, 1992, a period

of almost four months.

Moreover, it is not clear that Dr. Nelson intended the

"program of exercise" he prescribed in November 1991 to be

unsupervised, as the Workers' Compensation Court inferred.

Zimmerman testified that to her, "program of exercise" meant

treatment supervised by a therapist. She also testified that she

would not recommend unsupervised exercise for a person in Chapman's

condition who had had no therapeutic exercise for several months.

Dr. Nelson did not testify. Thus, the question is not whether the

insurer should have paid for therapy that Chapman never attempted,

but whether unsupervised exercise at the YMCA was reasonable

physical therapy, compensable as a reasonable and necessary medical

expense under 5 39-71-704, MCA.

We conclude that substantial, credible evidence supports the

insurer's view that unsupervised exercise was not reasonable

physical therapy for Chapman after she returned from Florida in

November 1991. We hold, therefore, that the insurer did not act

unreasonably in refusing to pay for it.

II

Did the Workers' Compensation Court err in denying Chapman a

20 percent penalty under § 39-71-2907, MCA?

Section 39-71-2907(l), MCA (1987) (emphasis added) provides

that:

When payment of compensation has been unreasonably

delayed or refused by an insurer . . . the full amount of

the compensation benefits due a claimant between the time

8
compensation benefitswere delayed or refused and the

date of the order granting a claimant compensation

benefits may be increased by the workers' compensation

judge by 20%. The auestion of unreasonable delav or

refusal shall be determined by the workers' compensation

iudae . . . ,,

The Workers' Compensation Court concluded that Chapman was not

entitled to statutory penalties because the insurer acted

reasonably throughout.

Chapman argues that she is entitled to the 20 percent penalty

because the insurer's refusal to pay for unsupervised exercise in

January 1992 was unreasonable in view of the fact that it had paid

for unsupervised exercise at the YMCA in 1991. She contends that

the insurer's four-month delay in paying for her health club

membership in Florida during the summer of 1991 also was

unreasonable, for the same reason.

Unreasonable delay or refusal is a question of fact to be

determined by the Workers' Compensation Court: we will not reverse

its decision on awarding a penalty if the decision is supported by

substantial, credible evidence. Field, 847 P.2d at 310; Jaenish v.

Super a Motel (1991), 248 Mont. 383, 389-90, a12 P.2d 1241, 1245.

Here, the court determined, based on the record, that the insurer

paid for Chapman's health club membership in Florida within a

reasonable time after it received the club's bill; it found,

therefore, that the delay was not unreasonable. This decision is

supported by substantial evidence.

Having concluded under the first issue that the insurer's

refusal to pay for Chapman's YMCA membership in January 1992 also

was not unreasonable, we hold that the Workers' Compensation Court

9
did not err in denying penalties under F, 39-71-2907, MCA (1987).

III

Did the Workers' Compensation Court err in denying Chapman

costs and attorney's fees?

Section 39-71-611, MCA (1987), requires an insurer to pay a

claimant's reasonable costs and attorney's fees if the insurer

unreasonably denies liability for a claim later adjudged

compensable by the Workers' Compensation Court. As the claims for

which the insurer denied liability in this case were not later

adjudged compensable by the Workers' Compensation Court, this

statute does not apply. The Workers' Compensation Court did not

err in denying Chapman costs and attorney's fees.

AFFIRMED.

We concur:

- -w

10
July 13, 1993

CERTIFICATE OF SERVICE

I hereby certify that the following order was sent by United States mail, prepaid, to the

following named:

Don Edgar Burris

Attorney at Law

P.O. Box 2344

Billings, MT 59103

William J. Mattix

Attorney at Law

P.O. Box 2529

Billings, MT 59103-2529

ED SMITH

CLERK OF THE SUPREME COURT

STATE OF~MONTANA