• Award of Refund from Provider to Workers’ Comp Carrier Held to be outside the Scope of District Court’s Authority
  • June 27, 2013
  • Law Firm: Martin Disiere Jefferson Wisdom L.L.P. - Houston Office
  • In a lengthy and thorough opinion last Thursday, a panel of the Austin Court of Appeals held that a district court hearing an appeal from an administrative decision of the Division of Workers’ Compensation did not have the authority to order a partial refund of an award paid to a medical care provider, even though the original award had itself been invalidated. In Vista Medical Center Hospital v. Texas Mutual Ins. Co., Nos. 03-11-00641-CV through 03-11-00643-CV and 03-11-00742-CV through 03-11-00785-CV, - WL - (Tex. App.-Austin June 6, 2013), the court of appeals reviewed the consolidated appeal of multiple proceedings in Travis County District Court arising out of alleged underpayment by Texas Mutual Insurance Company for emergency care under workers’ compensation policies. Administrative proceedings resulted in a number of money awards to the provider, which Texas Mutual paid. The dispute in this appeal arose out of orders reversing those money awards which included directives that Vista Medical pay back the additional moneys it had received.

    The court of appeals first provided a detailed review of the worker’s compensation system in Texas, and described a prior dispute over the “stop-loss exception” to per-diem rates. The result of the stop-loss controversy in this case was that certain of Texas Mutual’s previous payments of administrative awards to Vista Medical were deemed to have been excessive. After considering and rejecting a waiver argument advanced by the provider, the court addressed the principal matter in controversy, whether the district court had jurisdiction to award money relief in the form of a “refund” of an “overpayment” based on the administrative decision.

    Texas Mutual argued that it was entitled to these refunds on an equitable basis, urging a “money had and received” theory in support of the district court’s rulings. The court disagreed, and determined that the statutory scheme allowed only one remedy - a remand from the district court back to the Division of Worker’s Compensation to follow the exclusive administrative process. (The appeal addressed other issues, and still more remained before the district court; thus, the ultimate result following the 51-page opinion was an affirmance in part, a reversal and remand in part, and a reversal and render in part.)