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Employer not compelled to pay for new home, proposed renovations

Workers comp

The Commonwealth Court of Pennsylvania on Monday ruled that the state’s Workers’ Compensation Act does not authorize an order for an employer to pay an injured worker for home modifications that were never done or to contribute to the purchase of a new home.

Miguel Castaneda-Escobar worked for Ralph Martin Construction. In May 2010, he fell off a roof and injured his cervical spine. The accident left him paraplegic. RMC accepted liability for Mr. Castaneda-Escobar’s injuries.

Mr. Castaneda-Escobar was living in his brother’s row house in Reading. The bedrooms and bathroom were on the second floor and the living room was temporarily converted into his living quarters.

In 2011, a design and construction firm estimated that it would cost $119,722 to modify the home with a first-floor addition that included a new bedroom and bathroom. The firm suggested it might be more cost-effective for Mr. CastanedaEscobar to relocate to a single-floor residence with wheelchair accessibility.

In November 2018, Mr. Castaneda-Escobar bought a home for $230,000 in Leesport. He incurred closing costs of $4,158. The home had a first-floor bedroom and bathroom, but the shower had to be modified to provide wheelchair accessibility. RMC reimbursed Mr. Castaneda-Escobar for the $5,905.04 he spent to modify the bathroom.

In January 2019, RMC filed a petition seeking a determination of whether Mr. Castaneda-Escobar’s purchase of the Leesport home was a reimbursable medical expense under the Workers’ Compensation Act.

A workers’ compensation judge found RMC was not liable for the cost of the home or the estimated cost to renovate the row house. The judge instead held RMC liable for the closing costs, since the purchase relieved it of the obligation to modify the row house. The judge also ordered RMC to pay $5,067 for Mr. Castaneda-Escobar’s litigation costs.

The Workers’ Compensation Appeal Board ruled that Mr. Castaneda-Escobar’s purchase of the Leesport home did not relieve RMC of its obligation to renovate the row house. The WCAB ordered RMC to pay the cost of that renovation, with a credit for the $5,905.04 it had already paid for the bathroom renovation in the Leesport home. It affirmed the WCJ’s award of litigation costs, too.

The Commonwealth Court of Pennsylvania said the Workers’ Compensation Act obligates an employer to pay for an injured employee’s medicine, hospital treatment, services, supplies and orthopedic appliances and prostheses. Pennsylvania case law has interpreted this obligation

as including the cost of home modifications, but only for the cost of a one-time, minor modification or the maintenance of the modification so that the injured worker can use a wheelchair.

The court said there is no precedent that has established that an employer can be held liable to purchase an entire house for a claimant or to pay for modifications that were never undertaken, and it found the purchase of a new home extends the phrase “orthopedic appliances” beyond a reasonable construction.

While the consultants determined that $119,722.21 was required to remodel the row house, the court said this did not become Mr. CastanedaEscobar’s “baseline entitlement.”

WorkCompCentral is a sister publication of Business Insurance. More stories here.