The four newest workers' compensation judges are much more tightfisted than their predecessors in handing out money to injured Oklahoma workers.
The four have awarded, on average, $5,092 less to workers with permanent injuries than did the four judges they replaced, records show. That's a 15.6 percent drop.
Gov. Mary Fallin appointed the four new judges.
“Whether it's right or wrong, judges appointed by Republican governors tend to be more conservative judges who are pro-business,” said Bob Burke, a workers' compensation attorney who represents injured employees.
The Legislature this year is considering radical changes to a state workers' compensation system that some contend is so political that which judge hears a case can be almost as important in determining how much a worker receives as the extent of the worker's injuries.
Burke said injury awards declined during former Republican Gov. Frank Keating's administration, went back up during former Democratic Gov. Brad Henry's administration, and are dropping again now that Fallin is appointing judges.
“It's not a secret. That's just the way it has always been,” Burke said. “I may be the only person willing to talk about it publicly, but it's the truth.”
Judging the judges
Oklahoma's judicial appointment process is designed to cushion, but not eliminate, politics in the selection of judges. It requires the governor to choose each judge from a list of three names submitted by the state's Judicial Nominating Commission, which screens candidates for competency.
Workers' compensation attorneys know the reputations of various judges for giving high or low disability awards, Burke said. When negotiating settlements, the name of the judge is often the first question asked, because it can make a 25 to 30 percent difference in the settlement amount an attorney is willing to accept, he said.
Fallin's four appointees issued court orders in 763 permanent partial disability cases and handed out awards that averaged $27,469 in the last half of 2012, said Michael Clingman, court administrator.
The four judges they replaced issued court orders in 788 cases with awards that averaged $32,561 during the first half of 2012, Clingman said.
The new judges also rejected more benefit claims — issuing 132 denials compared to 117 by their predecessors last year.
Permanent partial disability awards are designed to compensate workers for injuries and occupational diseases that permanently prevent them from functioning to their full potential.
Margaret Anne Bomhoff, one of the new judges, said other factors also contributed to declining awards. The maximum permanent partial disability award was lowered from $359 a week to $323 a week for injuries that occurred on or after Aug. 27, 2010. And a new law that became effective in 2011 limits compensation for certain types of injuries, she said.
Judges must base their decisions on the law in effect at the time of the injury, rather than the time of the hearing, so more cases are now being heard based on the new law, which is less generous with benefits, she said.
Bomhoff, a former workers' compensation attorney who represented employers, said members of the Judicial Nominating Commission and the governor's staff did not quiz her about how conservative or liberal she would be with awards during the selection process.
“They wanted to know if I would follow the law and if I could stand up to the strong personalities out at the court,” she said.
The decline in average permanent partial disability awards by Fallin appointees is significant, but not nearly as dramatic as the 138 percent increase that occurred between fiscal year 2002 and fiscal year 2011.
Fiscal year 2002 was Republican Gov. Keating's last full fiscal year in office, and by then he had appointed all the judges to the court. That year, permanent partial disability awards averaged $14,112.
By fiscal year 2011, Henry, a Democrat, had appointed all the judges, and average awards soared to $33,680.
Burke said a 51 percent increase in the maximum payment for a permanent partial disability would account for part of that increase, but not the bulk of it.
“I am flabbergasted and shocked,” Burke said after reviewing those statistics. “I always knew there was a difference, but I had no idea how much. Some GOP judges turn out to be liberal and some Democratic judges turn out to be conservative … but there is a definite pattern.”
Workers' compensation attorneys know the pattern well. It directly affects their pocketbooks given that attorneys who represent injured workers receive 20 percent of partial disability awards in contested cases.
With a lot riding financially on the outcome of elections, workers' compensation attorneys traditionally have been among the most generous contributors to gubernatorial campaigns, with many making maximum $5,000 contributions.
In 1993, some were indicted along with former Democratic Gov. David Walters in a scandal tied to illegal contributions to his 1990 campaign. Walters pleaded guilty to a misdemeanor.
The four judges appointed by Fallin are Bomhoff, of Edmond; Michael William McGivern, of Tulsa; Lloyd Bradley Taylor, of Tulsa; and Carla Jo Snipes, of Oklahoma City.
They replaced former judges C. Kent Edridge, Gene Prigmore, Cherri Farrar and John M. McCormick.
Asked whether the governor would like to comment on declining awards, her spokesman responded: “Governor Fallin's focus has been to appoint good, qualified judges that follow the law.”
Judges serve staggered eight-year terms. To date, Fallin has appointed four of the court's 10 judges. She is scheduled to make four more appointments to terms beginning July 1, 2014, if the law isn't changed before then.
Judges hear and decide cases individually, but appeals can be made to three-judge panels or the Oklahoma Supreme Court.
Oklahoma business leaders have been critical of the magnitude of permanent partial disability awards handed down by state workers' compensation judges in recent years.
They point to a 2012 report by the National Council on Compensation Insurance that showed Oklahoma's average cost per permanent partial disability case was the highest in an eight-state region and nearly double the regional average.
That same report showed Oklahoma workers file permanent partial disability claims more than twice as frequently as the regional average.
Mike Seney, of The State Chamber of Oklahoma, said high workers' compensation costs hinder the state's ability to recruit and retain businesses.
The rise and fall of workers' compensation awards, depending on the outcome of gubernatorial elections, shows the system is broken, he said.
“What we've done has obviously not worked,” Seney said. “If we can have that much of a variance between governors appointing judges, we're never going to fix the system.”
Time for a change?
Seney said most business leaders believe it is time to scrap the system and replace it with an administrative system.
Burke opposes such radical change.
Even though he represents injured workers, Burke said he would agree with employers who complain that judges have been overly generous with permanent partial disability awards in recent years.
However, the reduced compensation awards by Fallin's four appointees are projected to have a $10 million annual impact on the system, he said. By the end of Fallin's four-year term, Burke said he expects additional judicial appointments and the impact of 2011 reforms will reduce costs by $100 million a year.
“We should not rush to change a system that has been recently overhauled,” Burke said. “The changes are working.”
Fred Boettcher, another longtime attorney who represents injured workers, said he believes the judges appointed by Fallin are “darn good people.”
Boettcher said he has witnessed some radical swings in workers' compensation awards in years gone by but hasn't noticed a significant reduction in workers' compensation awards handed down by the newest judges.
“A lot depends on the philosophy of the person appointed,” he said. “It doesn't necessarily condemn either group. It waxes and wanes in terms of the interpretation of the amount of disability.”