Updated: Florida Supreme Court Declines Jurisdiction in Challenge to Workers’ Comp System

By Michele Ready | April 28, 2016

The Florida Supreme Court has ruled that it does not have jurisdiction in a case brought by an injured nurse that challenged the constitutionality of the entire Florida Workers’ Compensation system.

In the case of Stahl v. Hialeah Hospital, the Court said “After further consideration and hearing oral argument in this case, we have determined that we should exercise our discretion and discharge jurisdiction. Accordingly, we dismiss review.”

On April 6, 2016, Mark Zientz, the attorney for injured worker Daniel Stahl, argued before the court that since the law was first enacted, the legislature has so eroded the available benefits that the law no longer passes constitutional muster. Things have gotten so bad, according to Zientz, that the present law no longer represents the fair exchange intended by the original “grand bargain” in which workers gave up their right to sue in civil court in exchange for guaranteed benefits.

But judging by the questions asked during oral argument by Justices Barbara Pariente, Peggy Quince and James Perry – and to a lesser extent by Justice Fred Lewis – the Supreme Court seemed to be struggling with whether the court should be hearing the case at all. The Court seemed receptive to the arguments made by their former colleague and current attorney for the defendants, Kenneth Bell, who served on the Court from 2003 through 2008.

As the attorney for the employer (Hialeah Hospital) and their insurance company (Sedgewick Claims Management Services), Bell raised a procedural defense highlighting the legal path the Stahl case took to get before the Court. Bell argued that the only route to challenge the entire statute (a “facialchallenge, as opposed to an “as applied” challenge) was to seek a declaratory judgment in circuit court.

In support of his argument, Bell noted that the Stahl case was on appeal from a lower administrative judge, and the record for review was only about 20 pages. Bell argued that Stahl’s challenge could only have been made in circuit court. He also maintained that it would be improper for the Court to rule on the constitutionality of such a significant legislative scheme on the basis of such a minimal record.

In addition, Bell argued that the 2003 amendments to Florida’s Workers’ Compensation’s scheme were enacted in response to an insurance crisis in the State of Florida at a time when premiums were the highest in the country. He said there was no evidence that the legislature had acted arbitrarily, capriciously or without a reasonable basis.

On behalf of the injured worker, Zientz argued that the exclusivity clause (a provision that prevents injured workers from bringing civil suits against their employers except in very limited situations) is no longer constitutionally permissible because of cumulative reduction in medical and indemnity benefits.

Zientz argued that the system has been so diluted over time that workers were no longer getting a fair deal. Specifically, he said that the injured worker no longer has a right to full medical benefits and he pointed to the requirement that after an injured worker reached maximum medical improvement, he was required to make a $10.00 co-pay in order to see a doctor. He also noted that the system allows for apportionment (or carving out a portion of medical benefits related to preexisting conditions), although he conceded that his case did not involve a preexisting condition. The entire categories of wage loss benefits, he said, had been eliminated over the years.

Zientz’ comprehensive argument was dismissed by Bell as being a “kitchen sink” argument.

Nevertheless, several of the justices seemed to be sympathetic to the argument. Justice Pariente stated in her questioning that the inadequacies of the system had been pointed out before — specifically mentioning the changes regarding attorney’s fees and “doctors being chosen by the insurance company” — and went on to conclude “it looks like it has become a very meager amount of compensation for an injured worker . . . and it’s hard to deny that what’s happened over the last 50 years has not been a diminution in workers’ compensation benefits.”

The Stahl case is not the only workers’ compensation case currently pending before the Florida Supreme Court at this time. There are two other cases – Castellanos v. Next Door Co., et. al, and Westphal v. City of St. Petersburgthat involve constitutional challenges to the workers’ compensation law, although Stahl is the only one of the three which presents a challenge to the entire statute. The Florida Supreme Court heard Westphal in June of 2014 and Castellanos in November of that same year, yet no decision has been rendered on either case.

The workers’ compensation law was originally enacted in 1935 as part of the “grand bargain” in which injured workers gave up the right to civil lawsuits in exchange for a no fault system where they receive medical care and wage loss benefits with a goal of returning them to work.

In recent years, the Republican-dominated Legislature has focused on keeping insurance premiums down for businesses, while balancing cost-cutting measures with increased efficiencies and anti-fraud measures. Bell argued that the policy concerns raised by the Stahl case were more appropriately resolved by the Legislature, and not the Court. Four justices asked no questions whatsoever, which could indicate they agree with Bell on this point.

In his rebuttal, Zientz concluded “This is an important issue. This is something that involves tens of thousands of people who are hurt every day, not hurt on the job, but hurt by the system. And this is the court that has to make that decision as to whether or not they continue to get hurt or on whether or not we can stop that.”

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About Michele Ready

Michele Ready is an attorney with the insurance defense law firm Walton Lantaff Schroeder & Carson. She can be reached at mready@waltonlantaff.com.
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