Workers Comp Zone


A unanimous California Workers’ Compensation Appeals Board has issued its decision in Joey Costa vs. Hardy Diagnostic and State Compensation Insurance Fund.

Here’s the link to the decision: … 7-EB-8.pdf

The decision (Costa “2”) affirms the right of applicant attorneys to use vocational experts/labor market experts to rebut the permanent disability rating schedule.

But who will pay for the cost of a rebuttal expert?

The WCAB has determined that the costs must be borne by the defendant, although the board will look at the reasonableness of the costs on a case by case basis. Referencing Labor Code Section 5811, the WCAB found support in the case law for allocating these costs to the insurer. However, the costs must be reasonable and necessary at the time they are incurred.

The WCAB noted that one of the few parts of the Labor Code left intact in the 2004 SB 899 reforms was language which historically had been used to justify the admission of evidence to rebut the rating schedule.

Costa 2 takes on added importance for workers because of the low disability ratings under the permanent disability rating schedule adopted in 2005. Not every low rating will be subject to rebuttal, however.

For example, some workers who have returned to work may not have sufficient diminished earning capacity to justify this approach. And the time and expense of the process makes it impractical to do this in every case. In many parts of the state, the pool of vocational experts has shrunk along with the demise of the vocational rehab benefit.

Claimants without a lawyer will be unable to evaluate whether this approach is suitable (or even possible) for their cases. It will be interesting to see what advice the Information and Assistance Officers give on this point.

And there may be some resistance from some judges since the use of DFEC rebuttal testimony can result in time-consuming testimony.

Will Costa 2 make the insurance industry long for the pre-2005 rating system? No. But will it spur action for a meaningful revision of the PD rating system? Maybe.

Stay tuned. You can subscribe to the blog by using the RSS buttons at the lower right hand menu bar.

Julius Young

Category: Understanding the CA WC system