BEFORE THE WORKERS' COMPENSATION BOARD OF
THE STATE OF OREGON

In the Matter of the Adoption of
Rules and Permanent Amendments to
the Rules of Practice and Procedure
for Contested Cases Under the Workers’
Compensation Law, Relating to
OAR 438, Division 012 (Own Motion),
OAR 438-005-0055 (Notice of Claim )
Denial and Hearing Notice), and
OAR 438-015-0080 (Attorney Fees
in Own Motion Cases).
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WCB ADMIN. ORDER 2-2001






ORDER OF ADOPTION

          1. On August 31, 2001, the Workers’ Compensation Board filed a Notice of Proposed Rulemaking Hearing with the Secretary of State, giving notice of its intent to adopt permanent rules of practice and procedure relating to the Board’s "Own Motion" authority under OAR 438, Division 012, OAR 438-005-0055 (pertaining to Notice of Claim Denial and Hearing Notice), and OAR 438-015-0080 (Attorney Fees in Own Motion Cases) to incorporate recent legislative changes. Copies of the notice were distributed to the Oregonian, the Associated Press, and to the Capitol Press Room on September 6, 2001. The notice was published in the Secretary of State’s October 2001 Administrative Rule Bulletin.

          On September 13, 2001, copies of the notice, as well as the proposed rules, were also mailed to all interested parties whose names appear on the Board’s mailing list. Notice of the hearing was published in the July/August 2001 issue of the Board’s News & Case Notes, which was posted on the Board’s web-site on September 7, 2001. This notice was also published in the August 2001 and September 2001 issues of the Workers’ Compensation Section Newsletter, which were distributed to all Section members of the Oregon State Bar in early September and October 2001. On September 6, 2001, notice of this hearing was also posted on the Board’s web-site at: http://www.cbs.state.or.us/external/wcb/wcbrule/rules.htm.

          Thereafter, in accordance with the notice, a public hearing was conducted by Roger C. Pearson, Managing Attorney, on November 2, 2001 at Salem, Oregon. The record of the public hearing was closed at 5:00 p.m. on November 2, 2001.

          2. Three individuals offered testimony at the scheduled hearing. In addition, 17 written comments were received from practitioners, insurers, labor organizations, the Workers’ Compensation Division (WCD), Administrative Law Judges, and Board personnel. Copies of the transcript of the public hearing and of all written comments received are available for public inspection and copying at the offices of the Board, 2601 25th St. SE, Suite 150, Salem, Oregon 97302, during normal working hours from 8:00 a.m. to 5:00 p.m., Monday through Friday.

          3. Order of Adoption for Rules (Exhibit A). The Board has thoroughly reviewed and considered all comments pertaining to its proposed permanent rules. A written summary of the comments is also included in the record.

          As explained in the Board’s August 30, 2001 Statement of Need for the rules presented in Exhibit A, in Senate Bill 485 (SB 485), the legislature adopted a number of statutory amendments to ORS Chapter 656. Some of those amendments pertain to ORS 656.278, which involve claims under the Board’s Own Motion authority. On July 30, 2001, Governor Kitzhaber signed SB 485. The bill became effective on its passage. See SB 485, section 24. Pursuant to section 21 of SB 485, the amendments to ORS 656.278 become operative on January 1, 2002.

          Consistent with the amended statutory provisions, the Board has proposed the adoption of amendments to its administrative rules that pertain to Own Motion matters. The proposed amendments and rules (which are contained in Exhibit A, attached and incorporated by this reference), are designed to implement the statutory amendments enacted by SB 485 regarding Own Motion matters. After completing its review and consideration of the comments presented in response to the proposed amended rules, the Board has reached the following conclusions.

OAR 438-012-0001. In SB 485, the legislature renumbered ORS 656.278(1)(b) as ORS 656.278(1)(c) and changed the language of ORS 656.278(1)(b), which now provides that Own Motion benefits under ORS 656.278(1) may include temporary and permanent disability compensation for workers who submit and obtain acceptance of a claim for a compensable new medical condition or an omitted medical condition pursuant to section 10 of SB 485 and the claim was initiated after the rights under ORS 656.273 have expired. Consistent with this legislative change, the Board proposed renumbering OAR 438-012-0001(1)(b) as 438-012-0001(1)(c) and changing 438-012-0001(1)(b) by adding to the definition of an "Own Motion Claim" a request for temporary and/or permanent disability compensation for workers who submit and obtain acceptance of a claim for a compensable new medical condition or an omitted medical condition and the claim was initiated after the aggravation rights have expired.

Comments were received regarding the proposed changes to OAR 438-012-0001(1)(b). Specifically, it was pointed out that the proposed definition of Own Motion claims regarding new medical conditions and/or omitted medical conditions includes only claims related to compensable and accepted new/omitted medical condition claims. Under the proposed definition, a claim for benefits made regarding an unaccepted new/omitted condition claim for which compensability had not yet been determined would not qualify as an "Own Motion claim" and, thus, would not be subject to the requirements of OAR 438-012-0020 and 438-012-0030 (notice, content and processing of Own Motion claims). Therefore, a request for benefits under such circumstances would never have to be processed (because, by definition, it would not be an Own Motion claim unless the new/omitted condition was compensable and accepted). However, SB 485, section 10(3) requires that "claims" as defined in ORS 656.005 for new/omitted medical conditions, where aggravation rights have expired, be processed as requests for relief under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b). Thus, the statutory processing requirement is not limited to compensable and accepted new/omitted medical conditions. To remedy this situation, it was suggested that the term "compensable" and the phrase "where the claimant submits and obtains acceptance of a claim" be deleted from proposed OAR 438-012-0001(1)(b).

In addition, another comment noted that SB 485, section 10(3), provides that "claims for new medical or omitted medical conditions related to an initially accepted claim that are initiated after the rights under ORS 656.273 have expired shall be processed as requests for relief under the Workers’ Compensation Board’s own motion jurisdiction pursuant to ORS 656.278(1)(b)." Thus, the comment pointed out, a simple claim for acceptance of such a new/omitted medical condition claim would constitute an Own Motion claim under SB 485, section 10(3), without any requirement of a request for either temporary or permanent disability. Therefore, the proposed language in OAR 438-012-0001(1)(b) limiting an "Own Motion Claim" to a written request for "[t]emporary disability compensation and/or permanent disability compensation" is too restrictive. To remedy this situation, it was suggested that a request for "a claim" regarding such new/omitted medical conditions be added to the definition of an Own Motion claim in OAR 438-012-0001(1)(b).

After considering these comments, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comments. The Board considers such amendment will avoid potential claims processing problems and conflicts with SB 485, section 10(3), which requires that claims for new and/or omitted medical conditions initiated after expiration of aggravation rights be processed as requests for relief under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b), regardless of whether the new/omitted medical condition claim was compensable or accepted or whether temporary or permanent disability is requested. Consequently, the term "compensable" and the phrase "where the claimant submits and obtains acceptance of a claim" has been deleted from OAR 438-012-0001(1)(b). In addition, the term "or a claim" has been added to OAR 438-012-0001(1)(b). Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference. (1)

OAR 438-012-0020(3): This rule introduces four subsections that identify what constitutes notice of an Own Motion claim and ends with the phrase "after the expiration of aggravation rights." A comment was received noting that that phrase is redundant because the four subsections that follow specifying what constitutes notice of an Own Motion claim each contain reference to expiration of aggravation rights. Therefore, it was suggested that the phrase "after the expiration of aggravation rights" at the end of OAR 438-012-0020(3) be deleted.

After considering this comment, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comment. The Board considers such amendment will avoid redundant language. Consequently, the phrase "after the expiration of aggravation rights" has been deleted from OAR 438-012-0020(3). Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0020(3)(a): This rule is amended to identify as an Own Motion "claim" a written request for temporary disability compensation or claim reopening "regarding a compensable injury for which aggravation rights have expired." Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0020(3)(b): Under SB 485, section 10(3), claims for new medical conditions and omitted medical conditions initiated after expiration of aggravation rights and accepted by a carrier are processed as Own Motion claims under ORS 656.278(1)(b). As initially proposed, OAR 438-012-0020(3)(b) was added to identify as an Own Motion "claim" "[a] written request for temporary disability compensation or a claim reopening regarding a compensable new medical condition and/or omitted medical condition that the claimant submitted and obtained acceptance and for which the claim was initiated after expiration of aggravation rights."

Comments were received suggesting several changes to the proposed language in OAR 438-012-0020(3)(b). Two comments were received contending that, taken literally, the reference to "obtaining acceptance" regarding claims for new or omitted medical conditions would result in requests that are not accepted never meeting the definition of a notice of a claim. In this regard, one comment referred to the problems discussed above regarding the proposed amendments to OAR 438-012-0001(1)(b), which defines Own Motion "claims" involving new and/or omitted medical condition claims. OAR 438-012-0020(3)(b) provides a set of circumstances under which an insurer is deemed to have notice of an Own Motion claim regarding new/omitted medical condition claims initiated after expiration of aggravation rights. The comment suggested that including the term "compensable" and the phrase "that the claimant submitted and obtained acceptance and" in defining when an insurer is deemed to have notice of an Own Motion claim is too restrictive and conflicts with the requirement in SB 485 section 10(3) that new/omitted medical condition claims initiated after expiration of aggravation rights be processed under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b). The comment noted that if an insurer is deemed to have notice of an Own Motion claim only regarding compensable and accepted new/omitted medical condition claims, there would be no means to recognize/process in the Board’s Own Motion jurisdiction an "unaccepted" new/omitted medical condition claim initiated after expiration of aggravation rights for which compensability had not yet been determined. Such circumstances would violate SB 485, section 10(3), which does not contain a prerequisite of a "compensable" or "accepted" new/omitted medical condition claim. Instead, the only prerequisite in SB 485, section 10(3) to requiring processing of such claims under the Board’s Own Motion jurisdiction is the requirement that the claim for the new/omitted medical condition be initiated after the expiration of aggravation rights. The comment suggested that the term "compensable" and the phrase "that the claimant submitted and obtained acceptance and" be deleted from OAR 438-012-0020(3)(b) in order to avoid these problems.

Another comment noted that under the proposed language of OAR 438-012-0020(3)(b), only a written request for temporary disability compensation or a claim reopening would constitute notice of an Own Motion claim regarding a new/omitted medical condition claim initiated after expiration of aggravation rights. However, such a claim could also include a written request for permanent disability compensation. In addition, SB 485, section 10(3), requires that such claims be processed under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b). Moreover, proposed language in OAR 438-012-0020(3)(d) includes as notice of an Own Motion claim for a new/omitted condition claim initiated after expiration of aggravation rights any document "that reasonably notifies the insurer that a claim for temporary and/or permanent disability compensation is being made by the claimant or on the claimant’s behalf." (Emphasis added). To comply with SB 485, section 10(3), avoid processing problems, and make OAR 438-012-0020(3)(b) and 438-012-0020(3)(d) consistent, the comment suggested adding a written request for permanent disability compensation to the circumstances under which an insurer would be deemed to have notice of an Own Motion claim under the terms of OAR 438-012-0020(3)(b).

Finally, a comment was received suggesting that the term "reopening" be deleted from OAR 438-012-0020(3)(b) in defining what is deemed to notify a carrier of an Own Motion claim. The proposed language includes a written request for a "claim reopening" in defining an Own Motion claim regarding a post-aggravation new/omitted medical condition. However, under SB 485, section 10(3), a claimant may make a "claim" for acceptance of a new/omitted medical condition initiated after expiration of aggravation rights without requesting a "reopening." Therefore, this comment asserted that the proposed language is too restrictive. To remedy this situation, it was suggested that the term "reopening" be deleted from OAR 438-012-0020(3)(b).

After considering these comments, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comments. The Board considers such amendments will avoid conflict with SB 485, section 10(3), avoid potential claims processing problems, and avoid inconsistent language in OAR 438-012-0020(3)(b) and 438-012-0020(3)(d). Consequently, the terms "compensable" and "reopening" and the phrase "that the claimant submitted and obtained acceptance and" have been deleted from OAR 438-012-0020(3)(b). In addition, the term "and/or permanent" is added before the word "disability" in OAR 438-012-0020(3)(b) to include a written request for permanent disability in describing what may constitute written notice of an Own Motion claim regarding new/omitted medical condition claims initiated after expiration of aggravation rights. Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0020(3)(c): This rule is amended to identify as an Own Motion "claim" any document submitted to the insurer that reasonably notifies the insurer of a claim under amended ORS 656.278(1)(a). The proposed language provided that the following is deemed to notify the insurer of an Own Motion claim:

"Any document submitted to the insurer after expiration of aggravation rights that reasonably notifies the insurer that there is a worsening of the claimant’s compensable injury that results in the claimant’s inability to work and requires hospitalization or inpatient or outpatient surgery, or other curative treatment prescribed in lieu of hospitalization that is necessary to enable the claimant to return to work[.]"

A comment was received that objected to the phrase "there is a worsening of the claimant’s compensable injury," contending that by including such a "worsening" requirement the amended rule essentially requires that a claim explicitly state that the worker’s condition has worsened or that he or she is unable to work before the insurer would be required to process the claim. The comment noted that, although there has always been a substantive requirement of a worsening of the compensable condition before benefits were due for an Own Motion claim, no "worsening" requirement was included in former OAR 438-012-0020(3)(c), which deemed an insurer to have notice of a claim based on "[a]ny document that reasonably notifies the insurer that the claimant’s compensable injury requires surgery or hospitalization." Thus, the comment noted, under the previous version of the rule, if an insurer received a medical report showing that surgery or hospitalization was necessary for the compensable injury, the insurer had a duty to process it as a claim for temporary disability benefits. The comment contended that the amended rule is too restrictive and suggested replacing the "worsening" requirement.

After considering this comment, the Board has decided to change the proposed language by deleting the reference to "a worsening." As the above comment pointed out, former OAR 438-012-0020(3)(c) did not include any reference the requirement of a "worsening," although there has always been a substantive requirement that there be a worsening of the compensable injury to establish entitlement to Own Motion relief. ORS 656.278(1)(a).

In considering this comment, the Board notes that earlier versions of OAR 438-012-0020(3) did refer to a "worsening" of the claimant’s condition in defining when an insurer was deemed to have notice of an Own Motion claim. See former OAR 438-12-020(3)(b) (providing that an insurer is deemed to have notice of an Own Motion claim upon submission of "any document that reasonably notifies the insurer that the claimant’s compensable injury has worsened and requires surgery or hospitalization"), WCB Admin. Order 1-1994, eff. 1/1/95. In 1995, however, the rule was amended to eliminate the reference to a "worsening" in defining when an insurer was deemed to have notice of an Own Motion claim. See WCB Admin. Order 2-1995, eff. 1/1/96. In explaining this amendment, the Board stated that this change was made in the interests of simplifying the processing of potential Own Motion claims. WCB Admin. Order 2-1995, Order of Adoption, p. 12. A comment was received expressing concern that, with the removal of the "worsening" requirement, hospitalizations for diagnostic purposes would result in a temporary disability award. In response, the Order of Adoption explained that the modified rule was merely designed to require the carrier to process the claim as one for Own Motion relief; it was not intended to require the carrier to pay a temporary disability award commencing with such hospitalization. WCB Admin. Order 2-1995, Order of Adoption, p. 12. The Order of Adoption concluded that Own Motion relief remained expressly contingent on the existence of a worsening of a compensable injury requiring either inpatient or outpatient surgery or other treatment requiring hospitalization, as required by former ORS 656.278(1)(a).

Here, the Board’s objective in enacting the current amendments is to implement changes made by SB 485. SB 485 did not change the requirement of "a worsening." In addition, the Board finds instructive the reasoning summarized above that explained the basis for previously deleting the reference to a "worsening" in defining when an insurer is deemed to have notice of an Own Motion claim.

In conclusion, after further consideration, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule to provide as follows:

"Any document submitted to the insurer after the expiration of aggravation rights that reasonably notifies the insurer that the [claimant’s] compensable injury [requires surgery or hospitalization.] results in the claimant’s inability to work and requires hospitalization or inpatient or outpatient surgery, or other curative treatment prescribed in lieu of hospitalization that is necessary to enable the claimant to return to work;"

Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0020(3)(d): Under SB 485, section 10(3), claims for new medical conditions and omitted medical conditions initiated after expiration of aggravation rights and accepted by a carrier are processed as Own Motion claims under ORS 656.278(1)(b). As initially proposed, OAR 438-012-0020(3)(d) was added to identify as an Own Motion "claim" "[a]ny document submitted to the insurer regarding a compensable new medical condition and/or omitted medical condition that the claimant submitted and obtained acceptance and for which the claim was initiated after expiration of aggravation rights that reasonably notifies the insurer that a claim for temporary and/or permanent disability compensation is being made by the claimant or on the claimant’s behalf."

Comments were received suggesting several changes to the proposed language in OAR 438-012-0020(3)(d). Two comments were received contending that, taken literally, the reference to "obtaining acceptance" regarding claims for new or omitted medical conditions would result in requests that are not accepted never meeting the definition of a notice of a claim. In this regard, one comment referred to the problems discussed above regarding the proposed amendments to OAR 438-012-0001(1)(b), which defines Own Motion "claims" involving new and/or omitted medical condition claims. OAR 438-012-0020(3)(d) provides the circumstances under which an insurer is deemed to have notice of an Own Motion claim regarding new/omitted medical condition claims initiated after expiration of aggravation rights. The comment suggested that including the term "compensable" and the phrase "that the claimant submitted and obtained acceptance and" in the defining when an insurer is deemed to have notice of an Own Motion claim is too restrictive and conflicts with the requirement in SB 485 section 10(3) that new/omitted medical condition claims initiated after expiration of aggravation rights be processed under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b). The comment noted that if an insurer is deemed to have notice of an Own Motion claim only regarding compensable and accepted new/omitted medical condition claims, there would be no means to recognize/process in the Board’s Own Motion jurisdiction an "unaccepted" new/omitted medical condition claim initiated after expiration of aggravation rights for which compensability had not yet been determined. Such circumstances would violate SB 485, section 10(3), which does not contain a prerequisite of a "compensable" or "accepted" new/omitted medical condition claim. Instead, the only prerequisite in SB 485, section 10(3) to requiring processing of such claims under the Board’s Own Motion jurisdiction is the requirement that the claim for the new/omitted medical condition be initiated after the expiration of aggravation rights. The comment suggested that the term "compensable" and the phrase "that the claimant submitted and obtained acceptance and" be deleted from OAR 438-012-0020(3)(d) in order to avoid these problems.

Another comment noted that under the proposed language of OAR 438-012-0020(3)(d), a document reasonably notifying the insurer that "a claim" was being made by the claimant or on the claimant’s behalf would not be recognized as an Own Motion "claim." However, a claim for a new/omitted medical condition claim initiated after expiration of aggravation rights would come under SB 485, section 10(3), which requires that such claims be processed under the Board’s Own Motion jurisdiction pursuant to ORS 656.278(1)(b). The comment contended that any document submitted to the insurer that reasonably notified it that the claimant is making "a claim" for a post-aggravation new/omitted medical condition should be deemed notice of an Own Motion claim. To comply with SB 485, section 10(3) and avoid processing problems, the comment suggested revising the language to include "a claim for such condition(s) or a claim for temporary and/or permanent disability compensation for such condition(s)" to describe the circumstances under which an insurer would be deemed to have notice of an Own Motion claim under the terms of OAR 438-012-0020(3)(d).

Finally, another comment contended that the proposed language "gives the worker more latitude to establish a new medical condition claim than is allowed by statute." Regarding new/omitted medical condition claims initiated after expiration of aggravation rights, the proposed language deems that an insurer has notice of an own motion claim based on "any document . . . that reasonably notifies the insurer . . . that a claim . . . is being made by the claimant or on the claimant’s behalf." The comment points out that SB 485, section 10(1), provides explicit requirements to initiate new/omitted medical condition claims. SB 485, section 10(1), provides, in relevant part:

"To initiate omitted medical condition claims under ORS 656.262(6)(d) or new medical condition claims under this section, the worker must clearly request formal written acceptance of a new medical condition or an omitted medical condition from the insurer or self-insured employer. A claim for a new medical condition or an omitted condition is not made by the receipt of medical billings, nor by requests for authorization to provide medical services for the new or omitted condition, nor by actually providing such medical services."

The comment contends that the rule conflicts with this statutory language and suggests that the rule be amended to require a clear request for formal written acceptance from the worker.

After considering these comments, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the following manner. The term "compensable" and the phrase "that the claimant submitted and obtained acceptance and" has been deleted from OAR 438-012-0020(3)(d). The Board considers such amendments will avoid conflict with SB 485, section 10(3), avoid potential claims processing problems, and avoid inconsistent language in OAR 438-012-0020(3)(d) and 438-012-0020(3)(b). In addition, the language "a claim for temporary and/or permanent disability compensation is being made by the claimant or on the claimant’s behalf" is replaced with the following language:

"the worker clearly requested formal written acceptance of a new medical condition or an omitted medical condition from the insurer as required by SB 485, section 10(1) and (3)."

The Board considers that such amendments will avoid conflict with SB 485, section 10(1). Finally, because the suggested revision to include "a claim for such condition(s) or a claim for temporary and/or permanent disability compensation for such condition(s)" in describing when an insurer is deemed to have notice of an Own Motion claim under the terms of OAR 438-012-0020(3)(d) conflicts with the requirement in SB 485, section 10(1) of a clear written request for formal acceptance to initiate an omitted/new medical condition claim, the Board declines to make that suggested revision. Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0020(4)(d): This rule is amended to identify as an Own Motion "claim" any document submitted to the insurer that reasonably notifies the insurer of a claim for temporary disability compensation for a pre-1966 injury claim under amended ORS 656.278(1)(a). As proposed, amended OAR 438-012-0020(4)(d) provides that the following is deemed to notify the insurer of an Own Motion claim for medical benefits and/or temporary disability compensation relating to a compensable injury that occurred before January 1, 1966:

"Any document that reasonably notifies the insurer that the claimant is seeking temporary disability benefits and there is a worsening of the compensable injury that results in the inability of the claimant to work and requires surgery or hospitalization or other curative treatment prescribed in lieu of hospitalization that is necessary to enable the claimant to return to work[.]"

As with OAR 438-012-0020(3)(c), a comment objected to the phrase "there is a worsening of the claimant’s compensable injury," contending that by including such a "worsening" requirement the amended rule essentially requires that a claim explicitly state that the worker’s condition has worsened or that he or she is unable to work before the insurer would be required to process the claim. For the reasons expressed in the previous discussion regarding OAR 438-012-0020(3)(c), the Board has decided to remove the "worsening" reference that was contained in the proposed rule.

Another comment was made regarding the language "the claimant is seeking temporary disability benefits[.]" The comment contended that inclusion of this phrase was not necessary and could be relied on to avoid processing a claim in which a worker is substantively entitled to temporary disability benefits but the document indicating such entitlement does not provide that the worker is seeking such benefits.

The Board finds that this language is redundant in that introductory language in OAR 438-012-0020(4) provides, in part, that "an insurer is deemed to have notice of an own motion claim for medical benefits and/or temporary disability compensation" based on documents listed in four subsections, including OAR 438-012-0020(4). (Emphasis added).

After considering these comments, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule to read as follows:

"Any document that reasonably notifies the insurer that the [claimant’s] compensable injury results in the inability of the claimant to work and requires surgery or hospitalization[.] or other curative treatment prescribed in lieu of hospitalization that is necessary to enable the claimant to return to work."

Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0030(1) & (2): This rule is amended to comply with changes to processing deadlines in SB 485 and to maintain a consistent time period for the purposes of processing claims (whether the worker’s aggravation rights have or have not expired). Section (1) of the rule provides that, for Own Motion claims with a date of injury before January 1, 2002, the time period for the voluntary reopening of the claim or the submission of an Own Motion recommendation shall be 90 days. Section (2) of the rule provides that, for Own Motion claims with a date of injury on or after January 1, 2002, the time period for the voluntary reopening of the claim or the submission of an Own Motion recommendation shall be 60 days.

Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0030(1)(a) - (b), (2)(a) - (b): SB 485 changed the requirements for reopening an Own Motion claim and for reimbursement from the Workers’ Benefit Fund. The former procedures no longer require that the Board authorize payment of benefits, and the latter procedures no longer require that the Board "prescribe" the amount of the reimbursement. OAR 438-012-0030 is amended to apply these changes. OAR 438-012-0030(1)(a) and (2)(a) provide for the insurer’s voluntary reopening for provision of benefits allowable under ORS 656.278 or to grant additional medical or hospital care to the claimant. Alternatively, OAR 438-012-0030(1)(b) and (2)(b) provide for submittal of a written recommendation to the Board as to whether the claim should be reopened or denied.

A comment was received noting that the last sentence of OAR 438-012-0030(2)(b) is redundant in that it states that "[i]n extraordinary circumstances, the Board may grant the insurer an extension for submission of its recommendation." This same statement is made in the first sentence of OAR 438-012-0030(3), and OAR 438-012-0030(2) references OAR 438-012-0030(3). To avoid this redundancy, the comment recommends deleting the last of OAR 438-012-0030(2)(b).

After considering this comment, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comment. The Board considers such amendment will avoid redundant language. Consequently, the last sentence of OAR 438-012-0030(2)(b) is deleted. Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0030(3): As amended, this rule provides for an exception, in extraordinary circumstances, for the Board to grant an insurer an extension for submission of its recommendation of reopening or denial of an Own Motion claim. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0030(4): This rule requires Own Motion insurers to issue a 1502 Form to the claimant, claimant’s attorney (if any) and the Benefits Section whenever the insurer voluntarily reopens an Own Motion claim under ORS 656.278(5). This rule is designed to provide the Director with a record of the insurer’s claim processing action.

WCD submitted a comment, requesting that OAR 438-012-0030(4) be changed to refer to a 3501 Form, "Notice of Voluntary Reopening of Workers’ Compensation Claim," a new form WCD has created, instead of a 1502 Form. WCD also recommended that the rule require that a copy of the form be sent to the "Workers’ Compensation Division, Benefits and Policy Services Section," instead of the "Benefits Section."

WCD explained that it received testimony at an October 24, 2001 hearing on proposed amendments to OAR 436-060 (Claims Administration) that recommended against using Form 1502 to report voluntary reopenings of Own Motion claims under ORS 656.278(5) because Form 1502 has historically been used only to report openings and reopenings of claims under ORS 656.262 and 656.273, but not under ORS 656.278. WCD also noted that, although Form 1502 is useful for purposes of data collection for WCD, it is an inadequate vehicle to provide notice of a voluntary reopening under ORS 656.278(5) to an injured worker and provides no explanation of procedures to resolve disputes regarding such a reopening. WCD pointed out that Form 3501 can serve the dual purpose of providing adequate notification to the worker and providing WCD with the information it needs prior to providing reimbursement from the Reopened Claims Program.

Finally, another comment objected to the use of Form 1502 to provide notice to the claimant regarding a voluntary reopening of the own motion claim. This comment noted that Form 1502 is not sent to the claimant in any other claim situation and is not presented in a format that would be useful to the claimant. This comment noted that Form 1502 is used to provide claim status information to WCD.

After considering these comments, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comments. The Board finds that such amendments will provide consistent claims administration/processing requirements between the Board’s Own Motion and WCD and better notify the parties of their rights and responsibilities when a carrier voluntarily reopens a claim under ORS 656.278(5). Consequently, the reference to "1502 Form" is replaced with "3501 Form" and the reference to "Benefits Section" is replaced with "Workers’ Compensation Division, Benefits and Policy Services Section." Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(1)(a) - (c): These rules implement changes made by SB 485 regarding payment of temporary disability compensation for claims filed after aggravation rights have expired. SB 485 removed the provisions under former ORS 656.278(1)(a), (b) that required the Board to authorize payment of benefits. SB 485 also provided that, where there is a worsening of a compensable injury that results in the inability of the worker to work and requires hospitalization or surgery, or other curative treatment prescribed in lieu of hospitalization that is necessary to enable the worker to return to work, "payment of temporary disability compensation in accordance with ORS 656.210, 656.212(2) and 656.262(4) may be provided from the time the attending physician authorizes temporary disability compensation for the hospitalization, surgery or other curative treatment until the worker’s condition becomes medically stationary." Subsections (a) through (c) provide the conditions under which an insurer may provide temporary disability compensation for claims filed after aggravation rights have expired.

Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(2)(a) - (b): OAR 438-012-0035(2) implements amended ORS 656.278(1)(b) regarding new/omitted medical condition claims initiated after expiration of aggravation rights and provides the requirements for payment of temporary disability compensation for such claims. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(3): OAR 438-012-0035(3) is renumbered from 438-012-0035(2). The language of the rule is unchanged. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(4): OAR 438-012-0035(4) is renumbered from 438-012-0035(3) and the language is changed to comply with changes made by SB 485 that no longer require Board authorization to pay temporary disability compensation. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(5): OAR 438-012-0035(5) is renumbered from 438-012-0035(4) and provides the conditions under which temporary disability compensation may be terminated. OAR 438-012-0035(5)(c) is amended to provide that payment of temporary disability compensation may be terminated when authorized by the terms of ORS 656.268(4)(a) through (d). Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0035(6): OAR 438-012-0035(6) is renumbered from 438-012-0035(5). No change is made to the language of the rule. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0036(1) - (2): OAR 438-012-0036(1) implements amended ORS 656.278(1)(b), which provides for the potential for awards of permanent disability compensation for Own Motion claims regarding compensable new medical condition or omitted medical condition claims where the claim is initiated after the expiration of aggravation rights. OAR 438-012-0036(2) implements amended ORS 656.278(2)(d), which provides that benefits under ORS 656.278(1) "[m]ay include permanent disability benefits for additional impairment to an injured body part that has previously been the basis of a permanent partial disability award, but only to the extent that the permanent partial disability rating exceeds the permanent partial disability rated by the prior award or awards."

WCD submitted a written comment suggesting that the Board amend the language in OAR 438-012-0036(2) to apply only to new medical condition and omitted medical condition claims. WCD suggested that OAR 438-012-0036(2) should clarify that the award of permanent disability compensation is limited to the difference between a former award for the same body part and the disability resulting from the new or omitted medical condition.

Testimony from WCD further observed that permanent total disability benefits are available for such new medical condition and omitted medical condition claims based on the generic references to the "evaluation and determination of disability" under the Director’s disability standards under ORS 656.726 and references to "permanent disability benefits" in ORS 656.278(1)(b) and (2)(d). Finally, testimony from WCD acknowledged that the currently proposed Board rules do not suggest that permanent disability benefits are available for "worsened" conditions; however, WCD suggested that the Board clarify its rules to explicitly state that only new medical condition and omitted medical condition claims are entitled to permanent disability.

After considering these comments, the Board has decided to leave unchanged the proposed language in OAR 438-012-0036(2). An administrative agency may not, by its rules, amend, alter, enlarge or limit the terms of a statute. Cook v. Workers' Compensation Dept., 306 Or 134 (1988); U. of O. Co-oper. v. Dept. of Rev., 273 Or 539, 550 (1975). The amended rule tracks the language in ORS 656.278(2)(d), as quoted above. The Board finds that the language of the statute itself best expresses the terms of the statute. Therefore, the Board does not find that the amended rule alters, enlarges, or limits the terms of the statute it applies. Instead, the amended rule simply follows the statutory language.

Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0037: This rule implements changes in SB 485 regarding payment of medical benefits for injuries occurring before January 1, 1966. Specifically, OAR 438-012-0037 provides that the insurer may pay for reasonable and necessary medical services for pre-1966 claims. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0050(1)(c): This rule codifies the Board’s existing practice of deferring ruling on an Own Motion matter until resolution of any "pre-Director" medical treatment disputes that are being processed through a MCO dispute resolution process, in addition to resolution of any Director’s medical review under ORS 656.245, 656.260 or 656.327. (2) In addition, pursuant to SB 485, this rule is amended to include as a basis for a request for payment of temporary disability compensation a request for "other curative treatment prescribed in lieu of hospitalization that is necessary to enable the claimant to return to work."

Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0055: Pursuant to changes prescribed by SB 485, this rule is amended to delete references to administrative closures by the Board, which includes deleting subsection (2). In addition, OAR 438-012-0055 is amended to require including in the Notice of Closure any permanent disability award determined under ORS 656.278(1)(b) and (2)(d).

A comment was received suggesting that the section identifier number be deleted because, after the amendments, there is only one section. Therefore, it was suggested that the correct designation of the rule is "OAR 438-012-0055," without any section number.

After considering this comment, the Board finds that it is reasonable, necessary, and proper to amend the proposed rule in the manner suggested by the aforementioned comment. The Board considers such amendments will provide the correct rule numbering format. Consequently, the section designation "(1)" is deleted from OAR 438-012-0055. Accordingly, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board adopts the proposed rule, as modified above, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0060: This rule provides the Board’s review process for claim closures, which is amended as follows to provide for changes made by SB 485:

OAR 438-012-0060(1) is restructured to list the requirements for a request for Board review of an Own Motion Notice of Claim Closure. The request for review has an added requirement of providing the reason(s) for the request, which will assist the Board in determining whether the disputed issues may include permanent disability compensation, as well as temporary disability compensation and the claimant’s medically stationary date.

OAR 438-012-0060(2) now includes the timelines within which to request review of a carrier’s closure. These timelines remain unchanged.

OAR 438-012-0060(3) is renumbered from former OAR 438-012-0060(2). The rule has been supplemented to clarify that the insurer shall include evidence relating to permanent disability when submitting evidence pertaining to claimant’s condition at closure. The rule has also been amended to provide that the insurer send copies of any written argument to the claimant or the claimant’s attorney, if any.

OAR 438-012-0060(4) is renumbered from former OAR 438-012-0060(3) and instructs the claimant to send to the insurer copies of any evidence and written argument sent to the Board.

OAR 438-012-0060(5) is renumbered from former OAR 438-012-0060(4), with no change in the language.

OAR 438-012-0060(6) is renumbered from former OAR 438-012-0060(5), with no change in the language.

OAR 438-012-0060(7) is renumbered from former OAR 438-012-0060(6), with no change in the language.

The Board received one comment regarding proposed rules at OAR 438-012-0060(1) - (7). Specifically, this comment objected to the requirement in OAR 438-012-0060(3) that the insurer submit copies of "any evidence relating to permanent disability" when submitting evidence pertaining to claimant’s condition at claim closure. This comment objected to this quoted phrase, contending that because permanent disability is only an issue in new/omitted medical condition claims, the rule should be amended to require permanent disability information only in those cases.

After considering these comments, the Board has decided to leave unchanged the proposed language in OAR 438-012-0060(3). This subsection simply provides for the procedure to follow in developing the record from which the Board will conduct review of the insurer’s claim closure, it does not pertain to any substantive entitlement to permanent disability benefits. The rule pertaining to those benefits is at OAR 438-012-0036 and follows statutory language. Moreover, OAR 438-012-0060(3) only requires evidence that pertains to the claimant’s condition at closure, which is evidence in existence. Therefore, the rule does not require the insurer to generate evidence that is not already in its record, including any permanent disability evidence.

Consequently, for the reasons expressed in its previous Statement of Need, as well as those expressed above, the Board finds that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule (OAR 438-012-0060(1) - (7)) as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

OAR 438-012-0061: SB 485 requires that the Board "establish procedures for the resolution of disputes arising out of a voluntary reopening of a claim under this section." In response to this statutory amendment, the Board proposes adoption of OAR 438-012-0061, which provides, in part, that the insurer must submit copies of all evidence pertaining to the voluntary reopening within 14 days after notification from the Board that a review of a voluntary reopening has been requested. OAR 438-012-0061(2). The rule also provides that the claimant may submit additional evidence and argument within 21 days from the date the insurer mails its evidence and argument. OAR 438-012-0061(3).

A comment noted that the time frames in OAR 438-012-0061 (Board Review of Voluntary Reopening of an Own Motion Claim) differ from those in OAR 438-012-0060 (Board Review of Insurer Closure), which provides that the insurer must submit copies of all evidence pertaining to the claimant’s compensable condition at closure within 15 days after notification from the Board that a review of the closure has been requested and provides that the claimant may submit additional evidence and argument within 15 days from the date the insurer mails its evidence. OAR 438-012-0060(3), (4). This comment contends that the differing time frames are confusing and could lead to errors. This comment suggests that the Board amend the time frames to be uniform.

After considering these comments, the Board has decided to leave unchanged the proposed language in OAR 438-012-0061. The seven-day increment used in OAR 438-012-0061 is a more standard measurement of time frames. Moreover, in the Board’s experience, injured workers routinely require more than 15 days to respond to evidence provided by the insurer regarding Own Motion claims. Finally, although the time periods for the two rules are inconsistent, no changes to the time frames were proposed to OAR 438-012-0060. Under such circumstances, it would not be appropriate to introduce a change to the time frames in OAR 438-012-0060 at this time. Nonetheless, in the interests of developing uniformity among its rules, the Board may address the differing time frames in OAR 438-012-0060 at a later time.

Consequently, for the reasons expressed in its Statement of Need, and those discussed herein, the Board finds that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit A and incorporated herein by this reference.

          Order of Adoption for Rules (Exhibit B). The Board has thoroughly reviewed and considered all comments pertaining to its proposed permanent rules. A written summary of the comments is also included in the record.

          As explained in the Board’s August 30, 2001 Statement of Need for the rules presented in Exhibit B, in SB 485, the legislature adopted a statutory amendment to ORS 656.325(1)(b), which permits a worker to request an examination to be conducted by a physician selected by the Director from the list described in ORS 656.268(7)(d) if the worker: (1) has made a timely request for hearing on a compensability denial as required by ORS 656.319(1)(a); (2) the denial is based on one or more reports of a "carrier-requested" examination conducted pursuant to ORS 656.325(1)(a); and (3) the worker’s attending physician does not concur with the report or reports of the examining physician(s). In addition, in light of ORS 656.262(15) (requests for hearings from "non-cooperation" denials) and SAIF v. Dubose, 166 Or App 642 (2000), rev allowed 331 Or 692 (2001), the Board proposed amendments to OAR 438-005-0055 (Notice of Claim Denial and Hearings Rights) to provide for another version of the "hearing notice" rule for "non-cooperation" denials under ORS 656.262(15).

          Consistent with the amended statutory provisions, the Board has proposed amendments to OAR 438-005-0055. This rule is contained in Exhibit B, attached and incorporated by this reference. After completing its review and consideration of the comments presented in response to the proposed amended rules, the Board has reached the following conclusions.

OAR 438-005-0055(1): The amendments to OAR 438-005-0055(1) are designed to implement the statutory amendments enacted by SB 485 regarding a worker’s right to request an examination to be conducted by a physician selected by the Director under amended ORS 656.325(1)(b). The amendments notify the worker of his/her statutory right to make such a request of the Director (as well as the statutory provision that the costs of the examination and report will be borne by the carrier). This rule applies to all claim denials, except those under ORS 656.262(15).

A comment was received notifying the Board that the telephone number listed for the Benefits Section in the notice of denial is incorrect. The correct telephone number is (503) 947-7585.

In addition, a comment objected to the requirement that all claim denials, except those under ORS 656.262(15), contain this new, second paragraph regarding notification to the worker of his/her statutory right to make a request of the Director for appointment of a physician when certain circumstances are met. This comment contends that this new paragraph is "not needed in most cases because most denials do not involve insurer medical examinations." This comment also contended that the required statutory citations "will be meaningless and confusing to most workers." This comment suggested that the proposed rule be amended to eliminate the statutory references and to require the new paragraph only when it is relevant to the denial.

After considering these comments, the Board has decided to leave unchanged the proposed language in OAR 438-005-0055(1), with the exception of correcting the telephone number for the Benefits Section. Inclusion of such a notice provides full information to the parties. Inclusion of this new, second paragraph in all denials will avoid any oversight that might result in issuing the "wrong" type of denial. In addition, the first paragraph of the appeal rights refers to the claimant’s right to an attorney at no cost, and the second paragraph gives telephone numbers for the Benefits Section. Therefore, informational resources are provided that can assist a claimant if he/she is confused by the statutory citations.

Consequently, for the reasons expressed in its Statement of Need, and those discussed herein, the Board finds that the proposed rule (as amended to include the correct telephone number for the Benefits Section) is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit B and incorporated herein by this reference.

OAR 438-005-0055(2): This rule is added to apply to "non-cooperation" denials under ORS 656.262(15). (3) As noted in the comment to OAR 438-005-0055(1), the rule listed an incorrect telephone number for the Benefits Section in the denial notice. That same telephone number was used in OAR 438-005-0055(2). Therefore, the Board has amended OAR 438-005-0055(2) to include the correct telephone number for the Benefits Section. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule (as amended to include the include the correct telephone number for the Benefits Section) is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit B and incorporated herein by this reference.

          Order of Adoption for Rules (Exhibit C). The Board has thoroughly reviewed and considered all comments pertaining to its proposed permanent rules. A written summary of the comments is also included in the record.

          As explained in the Board’s August 30, 2001 Statement of Need for the rules presented in Exhibit C, statutory amendments enacted by SB 485 authorize permanent disability awards for Own Motion claims. See amended ORS 656.278. These amendments become operative January 1, 2002. SB 485, section 21. The current version of OAR 438-015-0080 provides for "out-of-compensation" attorney fees payable from temporary disability compensation authorized by the Board for an Own Motion claim.

          Consistent with the amended statutory provisions, the Board has proposed amendments to OAR 438-005-0080. This rule is contained in Exhibit C, attached and incorporated by this reference. After completing its review and consideration of the comments presented in response to the proposed amended rules, the Board has reached the following conclusions.

OAR 438-015-0080(1): This rule is amended to clarify that the "out-of-compensation" attorney fee described therein pertains to temporary disability awards granted by Board orders. Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit C and incorporated herein by this reference.

OAR 438-015-0080(2): This rule is added to address those cases where a represented claimant seeks Board review of a Carrier’s Notice of Closure of an Own Motion Claim and obtains increased compensation in the form of a permanent disability award. This addition incorporates OAR 438-015-0040, which provides for "out-of-compensation" attorney fees based on increased permanent disability awards arising from ALJ orders. (4) Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit C and incorporated herein by this reference.

OAR 438-015-0080(3): This rule concerns extraordinary attorney fee awards and is amended to pertain to all "out-of-compensation" attorney fee awards made by Own Motion orders (rather than merely temporary disability awards). Having received no objection to the proposed rule, the Board finds for the reasons expressed in its Statement of Need, and those discussed herein, that the proposed rule is reasonable, necessary, and proper. Accordingly, the Board adopts this proposed rule as a permanent rule, contained in Exhibit C and incorporated herein by this reference.

          4. Under the authority granted by ORS 656.726(5), the Board finds that:

      1. All applicable rulemaking procedures have been followed; and
      2. The rules being adopted are reasonable, necessary and proper.

          PURSUANT TO THE AMERICANS WITH DISABILITIES ACT GUIDELINES, ALTERNATIVE FORMAT COPIES OF THE RULES WILL BE MADE AVAILABLE TO QUALIFIED INDIVIDUALS UPON REQUEST TO THE BOARD.

          Consequently, in accordance with its Notice of Proposed Rulemaking, the Board adopts the attached rules, as set forth in Exhibits "A," "B," and "C," incorporated herein by this reference, as permanent rules of the Workers’ Compensation Board, to become effective January 1, 2002 and to apply to the following cases in the following manner:

          (1) Amendments to OAR 438-005-0055 shall apply to any claim with a date of denial on or after January 1, 2002. (5)

          (2) Amendments to OAR 438-015-0080 shall apply to all Own Motion cases pending before the Board on or after January 1, 2002.

          (3) Amendments to OAR 438-012-0001 through 438-012-0065 shall apply to Own Motion claims in existence on or after January 1, 2002.

          The Board further orders that notice of this Order of Adoption, along with a certified copy of the amended rules, be filed with the Secretary of State and that a copy of the aforementioned notice and amended rules be filed with the Legislative Counsel within 10 days after filing with the Secretary of State as required by ORS 183.715.


          1. SB 485, section 10(1) describes the requirements to initiate an omitted medical condition claim and a new medical condition claim. SB 485, section 10(2) and (3) describes how such claims shall be processed. Specifically, these subsections provide:

"(2) Claims properly initiated for new medical conditions and omitted medical conditions related to an initially accepted claim shall be processed pursuant to ORS 656.262.

"(3) Notwithstanding subsection (2) of this section, claims for new medical or omitted medical conditions related to an initially accepted claim that are initiated after the rights under ORS 656.273 have expired shall be processed as requests for relief under the Workers' Compensation Board's own motion jurisdiction pursuant to ORS 656.278(1)(b)"

          Thus, claims for new medical conditions and omitted medical conditions related to an initially accepted claim that are initiated after expiration of aggravation rights must be processed as Own Motion claims under ORS 656.278(1)(b), not under the provisions of ORS 656.262. ORS 656.262(6)(a), in part, provides for written notice of acceptance or denial of an initial claim within 60 days after the employer has notice or knowledge of the claim for such claims with a date of injury on or after January 1, 2002. SB 485, section 22(1). ORS 656.262(7)(a), in part, provides for written notice of acceptance or denial of aggravation claims, new medical condition claims, and omitted medical condition claims within 60 days after the carrier receives written notice of such claims for claims with a date of injury on or after January 1, 2002. SB 485, section 22(1). However, because new medical condition claims and omitted medical condition claims that are initiated after expiration of aggravation rights are explicitly directed to be processed under the Board's Own Motion jurisdiction, the requirements for written acceptance or denial under ORS 656.262 do not apply to such claims.

          Instead, under this statutory scheme, new medical condition claims and omitted medical condition claims that are initiated after expiration of aggravation rights must be processed under the Board's Own Motion jurisdiction. This requirement applies to all such claims initiated after expiration of aggravation rights, regardless of the date of injury. SB 485, section 22(2). Such claim processing is governed by ORS 656.278(1)(b) and the Board's Own Motion rules. SB 485, section 10(3); ORS 656.726(5); OAR 438-012-0030. Under the Board's Own Motion rules, as currently amended, for claims with a date of injury before January 1, 2002, a carrier shall, within 90 days after receiving the Own Motion claim, either voluntarily reopen the claim or submit a recommendation to the Board as to whether the claim should be reopened or denied. OAR 438-012-0030(1)(a) and (b). For claims with a date of injury on or after January 1, 2002, a carrier has 60 days after receiving the Own Motion claim to either voluntarily reopen the claim or submit a recommendation to the Board. OAR 438-012-0030(2)(a) and (b).

          That said, we note that additional claim processing is required if a worker makes a claim for medical services based on a new or omitted medical condition claim initiated after expiration of aggravation rights. Such a medical services claim would not be within the Board's Own Motion jurisdiction. We reach this conclusion based on the following reasoning.

          ORS 656.278(1)(b), which gives the Own Motion Board jurisdiction over new/omitted medical condition claims that are initiated after expiration of aggravation rights, does not refer to medical service claims. In addition, SB 485, section 10(3), pertains to new/omitted medical condition claims initiated after expiration of aggravation rights and assigns jurisdiction of such new/omitted medical conditions to the Board's Own Motion authority, without mention of medical services claims. Finally, ORS 656.278(2)(c) was added by SB 485, section 11, and provides that benefits under the Board's Own Motion jurisdiction under ORS 656.278(1) "[d]o not include medical services provided pursuant to ORS 656.245 except as provided under subsection (1)(c) of this section[.]" (Emphasis added). Thus, the above statutory scheme provides that the Board's Own Motion jurisdiction over medical service claims remains unchanged; i.e., the Board has jurisdiction in its Own Motion authority over such claims only if the date of injury is before January 1, 1966. See amended ORS 656.278(1)(c). However, medical service claims subject to ORS 656.245 are processed under the processing requirements of ORS 656.262.

          Therefore, for medical services claims related to new/omitted medical condition claims initiated after expiration of aggravation rights and with a date of injury on or after January 1, 1966, the carrier has two processing duties: (1) it must process the medical services claim by accepting or denying the claim under ORS 656.262 or disapproving the claim under ORS 656.245(6), 656.260, or 656.327; and (2) it must also process the new or omitted medical condition claim under the provisions of ORS 656.278(1)(b) and the Own Motion Board rules by voluntarily reopening the claim or submitting a recommendation to deny or reopen the claim. OAR 438-012-0030(1), (2).

          Such processing requirements could result in several scenarios, depending on the basis for processing of the medical services claim. If the carrier accepted the medical services claim, processing of the new/omitted medical condition claim could go forward in the Board's Own Motion jurisdiction. If, however, the carrier denied the medical services claim based on causation and a hearing was requested on that denial, the Own Motion Board might postpone action on the new/omitted medical condition claim pending resolution of the causation issue regarding the medical services claim. Cf. Robert E. Montgomery, 53 Van Natta 717 (2001) (Own Motion Board consolidated pre-1966 injury medical services claim with pending hearing regarding compensability of denied current condition claim and requested that, following the hearing, the ALJ submit a separate, unappealable recommendation with respect to the Own Motion matter). If the carrier disapproved the medical services claim under ORS 656.245(6), 656.260, or 656.327, and Director review was requested regarding that dispute, the Own Motion Board might postpone action on the new/omitted medical condition claim pending resolution of the medical services issue before the Director. Stanley P. Sommerville, 50 Van Natta 135 (1998) (Board postponed action on Own Motion claim pending Director's review of the requested medical treatment under ORS 656.327).

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          2. The Board has also proposed this rule amendment in a prior Citation of Statutory Authority and Statement of Need which was approved at an August 13, 2001 Board meeting. The rulemaking hearing regarding that proposed amendment, as well as the hearing on these proposed amendments of the Board's Own Motion rules, was jointly held on November 2, 2001.

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          3. The Board has also proposed this rule amendment in a prior Citation of Statutory Authority and Statement of Need which was approved at an August 13, 2001 Board meeting. The rulemaking hearing regarding that proposed amendment, as well as the hearing on this proposed amendment, was jointly held on November 2, 2001.

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          4. A copy of this proposal was submitted to the Board of Governors for the Oregon State Bar seeking its consultation pursuant to ORS 656.388(3). (Exhibit 2). The Board of Governors support the proposed amendments to the attorney fee schedule. (Exhibit 3).

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          5. SB 485, section 22(4), provides that the amendments to ORS 656.325(1) "apply to any claim with a date of denial on or after January 1, 2002." OAR 438-005-0055(1) (pertaining to the requirements of a denial notice regarding the claimant's potential right to request an examination by a physician selected by the Director where the denial is based on carrier-arranged medical examination(s) and the claimant's attending physician does not concur with that report(s)) applies amended ORS 656.325(1). Thus, the amendments to OAR 438-005-0055(1) "apply to any claim with a date of denial on or after January 1, 2002."

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