Darvel Burgess v. Sewerage & Water Board of New Orleans

Supreme Court of Louisiana
FOR IMMEDIATE NEWS RELEASE NEWS RELEASE #036

FROM: CLERK OF SUPREME COURT OF LOUISIANA

The Opinions handed down on the 29th day of June, 2017, are as follows:

BY JOHNSON, C.J.:

2016-C-2267 DARVEL BURGESS v. SEWERAGE & WATER BOARD OF NEW ORLEANS (Office
of Workers’ Compensation, District 8)

We remand this matter to the OWC for a determination of whether
IWP is a permissible out-of-state provider under La. R.S.
23:1203(A). If so, the OWC judge must then determine the amount
of reimbursement due after application of La. R.S. 23:1203(B),
Lafayette Bone & Joint, and La. R.S. 23:1142.
REVERSED AND REMANDED TO THE OFFICE OF WORKERS' COMPENSATION FOR
FURTHER PROCEEDINGS CONSISTENT WITH THIS OPINION.

JOHNSON, C.J., additionally concurs and assigns reasons.
HUGHES, J., dissents and will assign reasons.
GENOVESE, J., dissents and assigns reasons.

Page 1 of 1
06/29/2017
SUPREME COURT OF LOUISIANA

No. 2016-C-2267

DARVEL BURGESS

VERSUS
SEWERAGE & WATER BOARD OF NEW ORLEANS

ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, FOURTH
CIRCUIT, OFFICE OF WORKERS’ COMPENSATION DISTRICT 8

JOHNSON, Chief Justice

In this workers’ compensation case, the claimant, Darvel Burgess, filed a

Disputed Claim for Compensation after his employer, Sewerage & Water Board of

New Orleans (“S&WB”), refused to pay a $13,110.02 outstanding bill for

prescription medications from Injured Workers Pharmacy (“IWP”). The underlying

legal issue is whether the injured employee is entitled to his choice of pharmacy, or

whether that right belongs to the employer under the Louisiana Workers

Compensation Act (“LWCA”). We granted this writ application to resolve a split in

our circuit courts of appeal on this issue. After review, we hold the choice of

pharmacy in a workers’ compensation case belongs to the employer.

FACTS AND PROCEDURAL HISTORY

Darvel Burgess sustained a work-related injury on October 13, 2008. On

September 18, 2012, Mr. Burgess filed a Disputed Claim for Compensation against

his employer, S&WB, asserting in part a dispute over unpaid medical bills and

entitlement to penalties and attorney fees. The matter was submitted to the Louisiana

Office of Workers’ Compensation (“OWC”) solely on briefs and exhibits. The only

disputed issues presented to the OWC judge were unpaid bills from IWP and

Advanced Neurodiagnostic Center, as well as Mr. Burgess’ entitlement to penalties

1
and attorney fees as a result of S&WB’s failure to timely pay these bills.1

In his brief submitted to the OWC, Mr. Burgess asserted he is entitled to have

all necessary and related medical treatment and prescriptions paid by his employer

pursuant to La. R.S. 23:1203(A).2 He argued the unpaid bills were related to treatment

for his work-related injury, including medications prescribed by his treating

physician, and as such were reasonable and necessary. Mr. Burgess further requested

an award for penalties and attorney fees. S&WB argued it is not responsible for the

outstanding IWP bill pursuant to La. R.S. 23:1142(B) because it notified all injured

workers on October 10, 2011, that henceforth Corvel Caremark Pharmacy program

was the approved provider for prescription services and failure of the injured worker

to use the pharmacy card provided may result in non-payment of medications.

Additionally, S&WB noted IWP was notified on April 12, 2012, that it was not an

approved pharmacy provider for S&WB’s workers’ compensation claims and bills

submitted by IWP would be denied.

On June 18, 2015, the OWC judge issued a judgment ordering S&WB to pay

the outstanding $13,110.82 bill from IWP and all outstanding medical expenses owed

to Advanced Neurodiagnostic Center “via the fee schedule.” The OWC judge

awarded Mr. Burgess a $2,000 penalty and $2,000 in attorney fees due to S&WB’s

failure to timely pay these bills. S&WB suspensively appealed the judgment, but only

as to the IWP bill.

The court of appeal affirmed in a 2-1 decision. Burgess v. Sewerage & Water

Board of New Orleans, 15-0918 (La. App. 4 Cir. 2/3/16), 187 So. 3d 49 (“Burgess

I.”). In so doing, the Fourth Circuit concluded the choice of pharmacy belongs to the

employee, not the employer. 187 So. 3d at 57. The court noted La. R.S. 23:1203(A)

1
The Advanced Neurodiagnostic Center bill is not at issue in this court.
2
For the full text of the statutes referred to in this section, see DISCUSSION, infra.

2
requires the employer to provide the employee with all necessary prescription

medication. Id. at 51. The court of appeal referenced an Alabama case, Davis

Plumbing, Inc. v. Burns, 967 So. 2d 94 (Ala. Civ. App. 2007), which held the choice

of pharmacy under a similar Alabama statute belonged to the employee. Id. at 52. In

addition, the court analyzed each Louisiana appellate court case on the subject and

the differing outcomes. The court of appeal concluded that Louisiana is

overwhelmingly a patient’s choice state, observing that twenty-three other states

expressly provide for employer choice of treating physician and three limit the

employee’s choice to a list provided by the state agency. Id. at 57. In addition, the

court noted the LWCA contains no provision granting the employer the right to select

the pharmacy that the employee must use. To the contrary, the LWCA obligates the

employer to pay for the employee’s reasonably necessary prescription medication and

contains no exception for situations in which the employer objects to the pharmacy

the employee selects. Id. The court also rejected S&WB’s reliance on La. R.S.

23:1142(B) in an attempt to obtain the benefit of the choice of pharmacy, finding

prescription medication is not part of “nonemergency diagnostic testing or treatment”

under the statute, and further noting the purpose of the statute is to allow the

employer to contest unnecessary or unreasonable medical care, not to allow

employers to bargain shop. Id. at 57-58.

Judge Lobrano dissented, finding a determination of whether the employee is

entitled to his choice of pharmacy did not end the inquiry of whether payment of the

disputed pharmacy expenses is due or in what amount. Id. at 58. (Lobrano, J.,

dissenting). She noted IWP is an out-of-state provider, and La. R.S. 23:1203(A)

provides in pertinent part, “[m]edical care, services, and treatment may be provided

by out-of-state providers or at out-of-state facilities when such care, services, and

3
treatment are not reasonably available within the state or when it can be provided for

comparable costs.” Further, La. R.S. 23:1203(B) limits the employer’s obligation to

“reimbursement...as determined under the reimbursement schedule...pursuant to R.S.

23:1034.2, or the actual charge made for the service, whichever is less.” Id. at 58-59.

Judge Lobrano found the record lacked any evidence of whether IWP fit the criteria

for a permissible out-of-state provider under La. R.S. 23:1203(A) or any evidence of

the reimbursement schedule set forth in La. R.S. 23:1034.2, and the OWC judge erred

by failing to consider these issues. Id. at 59. Judge Lobrano opined the case should

be remanded to the OWC to determine whether pharmacy expenses are due to IWP

as an out-of-state provider, and if so, the amount of expenses due pursuant to the

reimbursement schedule. Id.

S&WB sought supervisory review in this court. While the application was

pending, this court rendered its opinion in Lafayette Bone & Joint Clinic v. Louisiana

United Business SIF, 15-2137 (La. 6/29/16), 194 So. 3d 1112, which addressed, but

did not decide, the choice of pharmacy issue. In that case, the claimants, who were

injured in the course of their employment, were treated by physicians at the Lafayette

Bone & Joint Clinic (“LB&J”). During the course of treatment, the physicians

prescribed medications which were dispensed directly to claimants by LB&J

employees. 194 So. 3d at 1115. On June 5, 2008, the workers’ compensation payor,

Louisiana United Business SIF (“LUBA”), sent letters to LB&J and its physicians,

stating that LUBA would no longer pay for prescription medications directly

dispensed by LB&J and directing LB&J physicians to issue future prescriptions to be

filled by local retail pharmacies. Despite these notices, LB&J continued to dispense

prescription medications directly to claimants throughout 2008 and to submit requests

for reimbursement to LUBA. LUBA declined payment, citing its June 5, 2008 notice.

4
LB&J filed a disputed claim with the OWC, seeking to recover the costs of the

medications dispensed, along with penalties and attorney fees. Id. After a trial on the

merits, the OWC issued judgment in favor of LB&J, but ordered that recovery for

medications dispensed after June 5, 2008, was limited by La. R.S. 23:1142(B) to $750

for each claimant. The OWC refused to award attorney fees and penalties in light of

LUBA’s notice to LB&J. The court of appeal reversed, awarded attorney fees and

penalties, and removed the $750 cap. Id. at 1116.

The majority of this court reversed the court of appeal’s modification of the

$750 cap and otherwise affirmed. As a threshold matter, this court noted the split in

the circuits on the choice-of-pharmacy issue, including Burgess I, but found the

evidence presented did not raise a tenable employee choice issue because the

evidence and testimony did not establish that the injured employees in these cases

made an affirmative choice of LB&J as their prescription medication provider. Id. at

1117-18. However, this court further found the choice-of-pharmacy issue was not

dispositive of the $750 cap issue:

Nor would resolution of the choice-of-pharmacy issue be dispositive of
the matters before the court. As we have stated, these cases hinge on
LSA-R.S. 23:1142(B)’s admonition that a “health care provider may not
incur more than a total of seven hundred fifty dollars in nonemergency
diagnostic testing or treatment without the mutual consent of the payor
and the employee.” In these cases, we conclude hereinafter that the
plaintiff/health care providers did not have the consent of the payor,
LUBA, even if they had obtained the consent of the injured employees,
to dispense prescription medications after June 5, 2008.

Id. at 1118.

This court found LUBA’s authorization for the employees to obtain medical

treatment from LB&J physicians did not encompass the dispensing of prescription

medications by LB&J. Specifically, this court reasoned:

Even though, prior to June 5, 2008, LUBA may have obligated itself to
reimburse the plaintiff/health care providers for prescription medications

5
 dispensed to injured employee patients during in-office medical
treatment by LB & J physicians, LUBA’s June 5, 2008 letter notified LB
& J and its physicians that it would no longer pay for LB & J dispensed
prescription medications; therefore, any ongoing consent to, or
authorization of, in-office dispensing of prescription medications by LB
& J physicians was terminated.

Id. at 1119. This court limited LB&J’s recovery to $750 of medication costs after it

was notified that it would not be reimbursed for medications it dispensed. Id.

In light of our decision in Lafayette Bone & Joint, this court granted S&WB’s

writ application and remanded the case to the court of appeal for reconsideration:

Writ granted. The case is remanded to the Court of Appeal for re-
briefing and reconsideration in accord with this Court’s decision in
Lafayette Bone & Joint Clinic v. Louisiana United Business SIF, et al
c/w Lafayette Bone and Joint Clinic v. Guy Hopkins Construction Co.,
Inc., et al., 15-2137 c/w 15-2138 (La. 6/29/16), __ So.3d __.

Burgess v. Sewerage & Water Board of New Orleans, 16-0416 (La. 9/16/16), 206 So.

3d 199.

On remand from this court, the court of appeal reaffirmed its original decision.

Burgess v. Sewerage & Water Board of New Orleans, 15-0918 (La. App. 4 Cir.

11/23/16), 204 So. 3d 1014 (“Burgess II”). In particular, the court of appeal found

Lafayette Bone & Joint was factually distinguishable from the instant case and thus

inapposite. 204 So. 3d at 1016. As it did in Burgess I, the court found in favor of the

employee on the choice-of-pharmacy issue. The court noted Lafayette Bone & Joint

involved physician-dispensed medication, a factual situation within the scope of La.

R.S. 23:1142(B), whereas this case involved an outside pharmacy dispensing

medication. As such, the Burgess II court held that the dispensing of prescription

medication does not constitute “nonemergency diagnostic testing or treatment” and

thus does not trigger the application of La. R.S. 23:1142(B). Id. at 1016-18.

Judge Lobrano again dissented based on reasons similar to those in her original

dissent regarding out-of-state providers. Id. at 1018. (Lobrano, J., dissenting).

6
Further, because IWP is an out-of-state provider, she also found the instant case

distinguishable from Lafayette Bone & Joint, which addressed the applicability of La.

R.S. 23:1142(B) to instances in which an in-state provider of pharmaceuticals

incurred expenses without the consent of the employer. Id. at 1019.

S&WB filed a second writ application with this court, which we granted.

Burgess v. Sewerage & Water Bd. of New Orleans, 16-2267 (La. 2/24/17), --- So. 3d

----.

DISCUSSION

In this case we are initially called upon to determine whether, under the

LWCA, it is the injured employee or the employer who is entitled to choose the

pharmacy to furnish prescription medications to the claimant. Our decision is

premised on the proper interpretation of parts of the LWCA. Such considerations are

questions of law and reviewed by this court under a de novo standard of review.

Catahoula Par. Sch. Bd. v. Louisiana Mach. Rentals, LLC, 12-2504 (La. 10/15/13),

124 So. 3d 1065, 1071. After our review, we “render judgment on the record, without

deference to the legal conclusions of the tribunals below. This court is the ultimate

arbiter of the meaning of the laws of this state.” Id.

The employer’s duty under the LWCA to furnish prescription medication is set

forth in La. R.S. 23:1203 which provides, in pertinent part:

A. In every case coming under this Chapter, the employer shall
furnish all necessary drugs, supplies, hospital care and services,
medical and surgical treatment, and any nonmedical treatment
recognized by the laws of this state as legal, and shall utilize such state,
federal, public, or private facilities as will provide the injured employee
with such necessary services. Medical care, services, and treatment may
be provided by out-of-state providers or at out-of-state facilities when
such care, services, and treatment are not reasonably available within the
state or when it can be provided for comparable costs. (Emphasis added)

B. The obligation of the employer to furnish such care, services,
treatment, drugs, and supplies, whether in state or out of state, is limited

7
 to the reimbursement determined to be the mean of the usual and
customary charges for such care, services, treatment, drugs, and
supplies, as determined under the reimbursement schedule annually
published pursuant to R.S. 23:1034.2 or the actual charge made for the
service, whichever is less. Any out-of-state provider is also to be subject
to the procedures established under the office of workers’ compensation
administration utilization review rules.

While this statute obligates an employer “to furnish all necessary drugs” to the injured

employee, it does not directly address who has the right to choose the pharmacy to

dispense these drugs. Although this court did not reach the choice-of-pharmacy issue

in Lafayette Bone & Joint, we did recognize “there is no explicit workers’

compensation law directing that one party has the exclusive right to choose a

prescription medication provider.” 194 So. 3d at 1117.

Our courts of appeal have reached differing opinions on the choice-of-

pharmacy issue. In addition to the Fourth Circuit’s ruling in this case, the Second

Circuit has also held the choice of pharmacy belongs to the employee. See Naron v.

LIGA, 49,996 (La. App. 2 Cir. 9/9/15), 175 So. 3d 475. The Naron court reasoned that

because La. R.S. 23:1203 does not address which party can choose a vendor, but does

set forth the employer’s obligation to reimburse a claimant for the lesser amount in

the fee schedule or the actual cost for medication, the employee was free to choose

the pharmacy from which he obtained his medication. Id. at 477-78.3 By contrast, the

Third and Fifth Circuits have held the choice of pharmacy belongs to the employer.

See Downs v. Chateau Living Center, 14-0672 (La. App. 5 Cir. 1/28/15), 167 So. 3d

875; Bordelon v. Lafayette Consolidated Government, 14-0304 (La. App. 3 Cir.

10/1/14), 149 So. 3d 421, writ denied, 14-2296 (La. 2/6/15), 158 So. 3d 816; Sigler

3
However, the Naron court also recognized the employee’s choice of pharmacy is not
boundless, noting that La. R.S. 23:1203(A) provides that services can be provided by out-of-state
providers when the services are not reasonably available within the state or when it can be provided
for comparable costs. The court held that regardless of whether an employer is found to have violated
its duty under La. R.S. 23:1203(A), the employee is still bound by the constraints of that statute in
regard to out-of-state providers. 175 So. 3d at 478.

8
v. Rand, 04-1138 (La. App. 3 Cir. 12/29/04), 896 So. 2d 189. In Sigler, the Third

Circuit found that the employer did not violate its obligation to the injured employee

under La. R.S. 23:1203(A) to furnish necessary drugs simply because it chose to have

the employee’s prescriptions filled by a different pharmaceutical company. 896 So.

2d at 198.4 Relying on Sigler, the Bordelon court held that the employer met his

obligation under the LWCA to pay for medication by specifying the pharmacy the

employee could use. 149 So. 3d at 423. The Fifth Circuit in Downs relied upon the

Third Circuit’s opinion in Bordelon to hold that an employer does not violate its duty

under La. R.S. 23:1203(A) by choosing the pharmacy to be used by an injured

employee. 167 So. 3d at 881.

After review of the law and the above jurisprudence, and considering the

arguments of the parties, we hold the Third and Fifth Circuits have correctly

determined the employer has the right to choose the pharmacy to furnish necessary

prescription drugs to an injured employee in a workers’ compensation case. Our

analysis begins with the applicable statutory law.

The function of statutory interpretation and the construction given to
legislative acts rests with the judicial branch of the government. The
rules of statutory construction are designed to ascertain and enforce the
intent of the Legislature. Legislation is the solemn expression of
legislative will, and, thus, the interpretation of legislation is primarily
the search for the legislative intent. We have often noted the paramount
consideration in statutory interpretation is ascertainment of the
legislative intent and the reason or reasons which prompted the
Legislature to enact the law. The starting point in the interpretation of
any statute is the language of the statute itself. When a law is clear and
unambiguous and its application does not lead to absurd consequences,
the law shall be applied as written and no further interpretation may be

4
Although the court in Sigler found the employer had the right to choose the pharmacy, the
court also found the employer violated its duties to the employee because the employer’s choice of
pharmacy was unable to provide the medication to the employee in a timely fashion. The court
explained: “Implicit within the requirement of La. R.S. 23:1203(A) that the employer ‘furnish all
necessary drugs’ is that those necessary drugs be provided timely. ... [The employer] effectively
denied [the employee] the drugs needed for his compensable injury by denying the timely availability
of those prescription drugs. In doing so, [the employer] violated its duty under La. R.S. 23:1203(A).”
896 So. 2d at 198-99.

9
 made in search of the intent of the Legislature. However, when the
language of the law is susceptible of different meanings, it must be
interpreted as having the meaning that best conforms to the purpose of
the law. Moreover, when the words of a law are ambiguous, their
meaning must be sought by examining the context in which they occur,
and the text of the law as a whole. Further, the Legislature is presumed
to act with full knowledge of well-settled principles of statutory
construction.

Catahoula Par. Sch. Bd., 124 So. 3d at 1073. With these principles in mind, we

examine the relevant statutes.

As stated earlier, La. R.S. 23:1203(A) provides that “the employer shall furnish

all necessary drugs.” Nowhere in the statute does the legislature provide the employee

with the right to choose a pharmaceutical provider from which to obtain the necessary

prescription drugs. By contrast, the legislature has specifically delegated to the

employee the choice of physician in La. R.S. 23:1121(B)(1), which provides “the

employee shall have the right to select one treating physician in any field or

specialty.” (Emphasis added). Had the legislature intended the employee to have the

choice of pharmaceutical provider in La. R.S. 23:1203(A), the legislature could have

easily provided for that choice as it provided for the choice of physician in La. R.S.

23:1121. Moreover, the statutory entitlement in La. R.S. 23:1121(B)(1) to choose a

physician cannot be read broadly to include an entitlement to choose a pharmacy.

Notably, the legislature utilized the very specific term “physician,” rather than the

more expansive term “health care provider” which is defined in the LWCA to include

pharmacies.5

In Burgess I, the court of appeal found it instructive “to consider the

5
La. R.S. 23:1021(6) provides: “‘Health care provider’ means a hospital, a person,
corporation, facility, or institution licensed by the state to provide health care or professional services
as a physician, hospital, dentist, registered or licensed practical nurse, pharmacist, optometrist,
podiatrist, chiropractor, physical therapist, occupational therapist, psychologist, graduate social
worker or licensed clinical social worker, psychiatrist, or licensed professional counselor, and any
officer, employee, or agent thereby acting in the course and scope of his employment.” (Emphasis
added).

10
jurisprudence addressing the related issue of choice of physician before the Louisiana

Legislature enacted La. R.S. 23:1121” in reaching its decision that the choice of

pharmacy belongs to the employee. 187 So. 3d at 54. The court referenced a First

Circuit case wherein the court “concluded that the choice of physician belonged to

the employee because ‘[t]he trust and confidence needed in a patient-doctor

relationship is important to successful treatment which can be best obtained if the

injured employee has the choice of physician for treatment purposes.’” Id. (citing

Kinsey v. Travelers Ins. Co., Inc., 402 So. 2d 226, 228 (La. App. 1st Cir.1981)). The

Burgess I court noted this same rationale-the patient’s trust and confidence-has been

applied in the context of determining whether the choice of pharmacy belongs to the

employee, although the court did recognize appellate jurisprudence, such as Sigler,

which found such rationale did not apply to a pharmacist. Id. The court of appeal

affirmed its position in Burgess II.

Reliance on jurisprudence concerning choice of physician is misguided. Unlike

La. R.S. 23:1121(B) governing choice of physician, the legislature has not afforded

the employee an absolute right to select a pharmacy under La. R.S. 23:1203(A). This

distinction is logical considering the importance of the doctor-patient relationship.

Unlike a patient’s personal relationship with his doctor, there is no meaningful

difference relative to which pharmacy is used to dispense a prescription drug that

would mandate employee choice under the LWCA. This distinction was recognized

by the Third Circuit in Sigler, supra. The Sigler court distinguished its prior decision

in Louisiana Clinic v. Patin’s Tire Service, 98-1973 (La. App. 3 Cir. 5/5/99), 731 So.

2d 525, which concerned whether the employer had the right to choose the diagnostic

facility to conduct the injured employee’s MRI scan. In Patin’s, the OWC judge

found that an employee has no cause of action under the LWCA to choose the

11
diagnostic facility, relying on La. R.S. 23:1121(B) which only allows the employee

the right to choose a treating physician. The Third Circuit reversed, finding the

judge’s reliance on La. R.S. 23:1121(B) to be misplaced. 731 So. 2d at 528. The court

noted it was the treating physician, not the employee, who ordered the MRI and the

employee was “not attempting to change treating physicians but to obtain a diagnostic

test at his physician’s instruction.” Id. The court found no authority that allows the

employer or insurer to dictate the place and physician to perform diagnostic testing

ordered by a treating physician. Rather, the court found the check on the employee’s

testing is through La. R.S. 23:1034.2 and 23:1142(B), which place a monetary limit

on the diagnostic testing. Id.

The Sigler court declined to apply the same reasoning to the choice of

pharmacy. 869 So. 2d at 198. “Because the administration of medical diagnostic

testing, the type of equipment used, and the interpretation of the results obtained from

the testing involve individual skill levels and perhaps comfort levels for patients, we

find that Patin’s does not apply to the circumstances of this case. Unlike in the

Patin’s case, the medication Sigler obtained was the same regardless of which

pharmaceutical company provided it.” Id. We agree with the analysis of the Sigler

court and reach the same conclusion in this case.

Additionally, the legislature has specifically directed that the laws contained

in the LWCA be construed as follows:

(1) The provisions of this Chapter are based on the mutual renunciation
of legal rights and defenses by employers and employees alike;
therefore, it is the specific intent of the legislature that workers’
compensation cases shall be decided on their merits.

(2) Disputes concerning the facts in workers’ compensation cases shall
not be given a broad, liberal construction in favor of either employees
or employers; the laws pertaining to workers’ compensation shall be
construed in accordance with the basic principles of statutory
construction and not in favor of either employer or employee.

12
 (3) According to Article III, Section 1 of the Constitution of Louisiana,
the legislative powers of the state are vested solely in the legislature;
therefore, when the workers’ compensation statutes of this state are to
be amended, the legislature acknowledges its responsibility to do so. If
the workers’ compensation statutes are to be liberalized, broadened,
or narrowed, such actions shall be the exclusive purview of the
legislature.

La. R.S. 23:1020.1(D) (Emphasis added). To extend the legislatively-granted

employee choice of treating physician to include the choice of pharmacy can only be

accomplished by giving an impermissibly expansive reading to the provisions of La.

R.S. 23:1203(A) and La. R.S. 23:1121, thus broadening the employee’s rights in

contravention of La. R.S. 23:1020.1(D).

Thus, while the injured employee is entitled to choose his treating physician

under the LWCA, we hold the law does not provide the employee a right to choose

a specific pharmaceutical provider. We therefore reverse the ruling of the court of

appeal on this issue.

It is important to recognize that the LWCA gives the employee protections to

ensure the employer satisfies its obligations under La. R.S. 23:1023. If an injured

employee experiences any delays or other discernable deficiencies in filling his

prescriptions through the employer-chosen pharmacy, constituting a violation of the

employer’s duty under La. R.S. 23:1203(A), the employee has a remedy for penalties

pursuant to La. R.S. 23:1201(E).6 See Sigler, 896 So. 2d at 198-99. In this case, there

is no evidence S&WB violated its duty under La. R.S. 23:1203(A) by requiring Mr.

Burgess to use a pharmacy included in the Corvel Caremark Pharmacy program.

We now turn to the $13,110.82 IWP bill for prescription medications it

6
La. R.S. 23:1201(E) provides: “(1) Medical benefits payable under this Chapter shall be
paid within sixty days after the employer or insurer receives written notice thereof, if the provider
of medical services is not utilizing the electronic billing rules and regulations provided for in R.S.
23:1203.2; (2) For those providers of medical services who utilize the electronic billing rules and
regulations provided for in R.S. 23:1203.2, medical benefits payable under this Chapter shall be paid
within thirty days after the employer or insurer receives a complete electronic medical bill, as defined
by rules promulgated by the Louisiana Workforce Commission.”

13
dispensed to Mr. Burgess from September 1, 2010, to December 7, 2012. Our

resolution of the choice-of-pharmacy issue does not fully resolve the issue of whether

S&WB is responsible for payment of the outstanding IWP bill. Based on the

particular facts of this case, that determination also requires consideration of La. R.S.

23:1203(A) and (B), as well as La. R.S. 23:1142.

Notwithstanding who chooses the health care provider, La. R.S. 23:1203(A)

allows for “medical care, services, and treatment” to be provided by out-of-state

providers only “when such care, services, and treatment are not reasonably available

within the state or when it can be provided for comparable costs.” It appears

undisputed by the parties that IWP is an out-of-state pharmacy. Additionally, the IWP

bill in the record provides a Massachusetts address. Thus, to be a permissible provider

under the LWCA, there must be a showing that the services IWP provides are not

reasonably available in Louisiana or that IWP’s services are provided for comparable

costs to Louisiana providers. According to the record before us, this issue was not

raised before nor considered by the OWC judge. The record contains no evidence

whether IWP fits the statutory criteria in La. R.S. 23:1203(A). Because IWP, as an

out-of-state provider, is bound by the constraints of La. R.S. 23:1203(A), we must

remand this matter to the OWC for a determination of this issue.

Additionally, if IWP is found to be a permissible out-of-state pharmacy, the

charges for medications it dispensed to Mr. Burgess would still be subject to the

provisions of La. R.S. 23:1203(B), which limits reimbursement to “the mean of the

usual and customary charges for such care, services as determined under the

reimbursement schedule annually published pursuant to R.S. 23:1034.2 or the actual

charge made for the service, whichever is less.” Fees in excess of the reimbursement

schedule are not recoverable against the employee, employer, or workers’

14
compensation insurer. La. R.S. 23:1034.2(D). Moreover, this court recognized in

Lafayette Bone & Joint that La. R.S. 23:1034.2(D) leaves open “the possibility that

medical fees, even though falling within the amounts set forth in the reimbursement

schedule, may be deemed unreasonable, unnecessary, or not ‘usual and customary,’

and therefore not subject to compensation under certain circumstances.” 194 So. 3d

at 1121-22. This court further noted “the expression of legislative intent set forth in

LSA-R.S. 23:1020.1 makes it clear that the reasonableness of medical costs is an

important consideration.” Id. at 1122. Thus, on remand, the OWC judge must

consider whether IWP is a permissible out-of-state provider and, if so, whether the

charges incurred were reasonable and within the guidelines referenced in La. R.S.

23:1203(B).

In the interest of judicial economy, and to fully instruct the OWC on remand

should IWP be determined to be a permissible out-of-state provider, we also address

the applicability of La. R.S. 23:1142(B), which provides:

Except as provided herein, each health care provider may not incur
more than a total of seven hundred fifty dollars in nonemergency
diagnostic testing or treatment without the mutual consent of the
payor and the employee as provided by regulation. Except as provided
herein, that portion of the fees for nonemergency services of each
health care provider in excess of seven hundred fifty dollars shall
not be an enforceable obligation against the employee or the
employer or the employer’s workers’ compensation insurer unless the
employee and the payor have agreed upon the diagnostic testing or
treatment by the health care provider. (Emphasis added).

In Lafayette Bone & Joint, this court applied the provisions of La. R.S. 23:1142(B)

to limit reimbursement to $750 for prescription medications dispensed directly by the

treating physician’s office without the employer/payor’s consent. 194 So. 3d at 1118.

In Burgess II, the court of appeal distinguished that factual situation and held the

dispensing of prescription medications by a pharmacist, as opposed to a claimant’s

treating physician, did not constitute “nonemergency diagnostic testing and

15
treatment” under the statute. 204 So. 3d at 1017. We recognize dispensing medication

is distinguishable from prescribing or administering medication. However, we find

no logical reason to factually differentiate this case from Lafayette Bone & Joint. In

both cases the healthcare provider sought reimbursement for the cost of prescription

medications issued to the injured employee. The act of dispensing prescription

medications is the same, regardless of whether the medications were provided by a

pharmacy or a physician’s office.

Although we did not fully analyze application of La. R.S. 23:1142(B) in

Lafayette Bone & Joint, implicit in our ruling was an acknowledgment that the

dispensing of prescription medications is encompassed in “nonemergency diagnostic

testing or treatment” under the statute. While the statutory language does not

expressly include a reference to prescription medication, we find the word

“treatment” in the statute is broad enough to encompass a pharmacy dispensing

prescription medication ordered by the claimant’s treating physician as part of the

claimant’s treatment. Thus, we now explicitly hold La. R.S. 23:1142(B) is properly

implicated in considering an employer/payor’s obligation to pay prescription

medication expenses in workers’ compensations cases.

La. R.S. 23:1142(B) requires a health care provider to have the consent of the

employee and the payor7 in order to receive payment in excess of $750 for

nonemergency care. The statutory requirement of “mutual consent” necessarily

imputes some obligation on the part of the provider to obtain the consent of the

employer/payor. La. R.S. 23:1142(B) does not supply a specific formula by which the

payor is to signify his consent, and the issue of consent is necessarily determined

based on the facts of each case. On remand, should IWP be determined to be a

7
“Payor” is defined in R.S. 23:1142 as the entity responsible for the payment of an injured
employee’s medical treatment.

16
permissible out-of-state provider, the OWC judge must address the issue of consent

considering the evidence in the record and applying the rationale of Lafayette Bone

& Joint, to determine whether IWP is entitled to recover expenses in excess of $750.

Finally, we find the issue of penalties and attorney fees is not properly before

this court. In its appeal to the Fourth Circuit, S&WB failed to assign as error or brief

this issue.8 Although the court of appeal affirmed the judgment of the OWC, the court

did not directly address the penalties and attorney fees award. Therefore, we pretermit

discussion of this issue. See Rule 2–12.4 of the Uniform Rules–Courts of Appeal;

State in Interest of J.M., 13-2573 (La. 12/9/14), 156 So. 3d 1161, 1164. See also

Boudreaux v. State, 01-1329 (La. 2/26/02), 815 So. 2d 7.

CONCLUSION

For the above reasons, we resolve the split in our circuit courts of appeal on the

choice-of-pharmacy issue in favor of the employer. Relative to whether S&WB is

responsible for payment of the outstanding IWP bill in this case, we remand this

matter to the OWC for a determination of whether IWP is a permissible out-of-state

provider under La. R.S. 23:1203(A). If so, the OWC judge must then determine the

amount of reimbursement due after application of La. R.S. 23:1203(B), Lafayette

Bone & Joint, and La. R.S. 23:1142.

DECREE

REVERSED AND REMANDED TO THE OFFICE OF WORKERS’

COMPENSATION FOR FURTHER PROCEEDINGS CONSISTENT WITH

THIS OPINION.

8
S&WB did raise the issue in its second brief to the court of appeal following remand from
this court. However, this was not an appeal from the OWC judgment. The parties were merely
ordered by the court of appeal to submit briefs addressing this court’s order relative to Lafayette
Bone & Joint.

17
06/29/2017
SUPREME COURT OF LOUISIANA

No. 2016-C-2267

DARVEL BURGESS

VERSUS
SEWERAGE & WATER BOARD OF NEW ORLEANS

ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, FOURTH
CIRCUIT, OFFICE OF WORKERS’ COMPENSATION DISTRICT 8

JOHNSON, Chief Justice, additionally concurs and assigns reasons.

I write separately to express my opinion on this issue of consent pursuant to La.

R.S. 23:1142(B). As pointed out in the majority opinion, La. R.S. 23:1142(B) does

not supply a specific formula by which the payor is to signify his consent, and the

issue of consent is necessarily determined based on the facts of each case.

The record in this case is extremely limited, and the evidence relating to this

issue consists of four items:

1) the outstanding bill from IWP in the amount of $13,110.82 for prescription

medications dispensed to Mr. Burgess from September 1, 2010, to December 7, 2012;

2) a letter from S&WB dated October 10, 2011, sent to “All Injured Workers”
stating:

Sewerage and Water Board has partnered with Corvel Caremark
Pharmacy Program for all Injured Employees. This Pharmacy card will
replace any pharmacy program that you may be currently using. It is
your responsibility to purchase all medications related to your injury
with the attached pharmacy card.

Failure to adhere to this practice may result in non-payment of your
Worker’s Compensation medications.

By your signature below you acknowledge that you will adhere to the
Sewerage and Water Board’s Workers’ Compensation Pharmacy
Program.

Mr. Burgess signed the letter on October 18, 2011.

1
 3) a letter from S&WB to IWP dated April 12, 2012, stating:

Please be advised that your company is not an approved pharmacy
provider for the Sewerage and Water Board of New Orleans (“Board”)
prescription claims. In October 2011, the Board provided each claimant
with a prescription card and the employee is required to use the card for
any and all prescription drugs. Therefore, your pharmacy should not
accept prescriptions from the Board’s injured workers. If any
prescription bills are submitted by your company payment will be
denied.

4) a letter from S&WB to IWP dated August 22, 2012, referencing two dates

of service for Mr. Burgess, July 10, 2012, and August 2, 2012:

On October 10, 2011 all injured employees were notified and signed
[an] agreement to adhere to [the] pharmacy program. On February 13,
2012 a letter was sent to Attorneys and your company was copied on
this memo. Also, on April 12, 2012 a letter was issue[d] directly to your
company informing you not to accept prescriptions from Sewerage and
Water Board of New Orleans.

Sewerage and Water Board is no longer paying bills submitted from
Injured Workers Pharmacy because we have a pharmacy program
provide[d] for our injured workers, and your company is not an
approved pharmacy provider. Therefore, your request for payment for
Darvel Burgess is denied.

It is also relevant that, by S&WB’s own admission, it paid approximately

$12,000 to IWP for prescription expenses incurred by Mr. Burgess over a period of

time prior to selecting the Corvel Caremark Pharmacy program.1

Considering the record, and applying the same rationale this court applied in

Lafayette Bone & Joint, I would find IWP’s recovery of expenses for medications

dispensed to Mr. Burgess after April 12, 2012, is limited by La. R.S. 23:1142(B) to

$750 because the medications were clearly dispensed by IWP without the consent of

the payor, S&WB. Based on the particular facts of this case, I do not find the October

10, 2011, letter to Mr. Burgess relevant to the consent issue. It is undisputed that

S&WB initially paid IWP’s bill, thereby providing tacit consent to Mr. Burgess’ use

1
At oral argument before this court, counsel for S&WB affirmatively stated S&WB paid over
$12,000 to IWP relative to Mr. Burgess’ prescription expenses.

2
of IWP as a pharmacy provider. Based on the record, there is no evidence IWP was

notified or otherwise aware of the withdrawal of that consent prior to the April 12,

2012 letter from S&WB. Thus, I find that until it received this notice, IWP had the

consent of S&WB to dispense prescription medications to Mr. Burgess for purposes

of La. R.S. 23:1142(B).

Furthermore, although IWP is entitled to reimbursement for prescriptions

dispensed to Mr. Burgess prior to April 12, 2012, I note the charges for these

medications are still subject to the reasonableness and cost limitations in La. R.S.

23:1203(B). Because there is no evidence in the record on this issue, the OWC must

determine the amount of reimbursement due to IWP for charges incurred prior to

April 12, 2012.

3
06/29/2017

SUPREME COURT OF LOUISIANA

No. 2016-C-2267

DARVEL BURGESS

VERSUS

SEWERAGE & WATER BOARD OF NEW ORLEANS

ON WRIT OF CERTIORARI TO THE COURT OF APPEAL, FOURTH
CIRCUIT, OFFICE OF WORKERS’ COMPENSATION DISTRICT 8

GENOVESE, Justice, dissenting.

I respectfully dissent from the majority decision. Of particular concern is the

judicial edict, without specific legislative authority, that the choice of pharmacy in a

workers’ compensation case belongs to the employer, disregarding the legislature’s

directive in La.R.S. 23:1020.1(D)(2) that the Louisiana Workers’ Compensation

Law shall not be construed “in favor of either employer or employee.”

Louisiana Revised Statutes 23:1203(A) delineates the obligation of an

employer to “furnish” an injured worker “all necessary drugs, supplies, hospital care

and services, medical and surgical treatment, and any nonmedical treatment

recognized by the laws of this state as legal . . . .” It does not necessarily give the

employer the right to choose the pharmacy. The key word in La.R.S. 23:1203 is

“furnish.” The dictionary definition of furnish is “to provide” or “to supply.” It

could be literally interpreted to mean the employer itself would have to

provide/supply the necessary drugs, etcetera, to the employee. I seriously doubt that

was the intent of the legislature. Employers cannot be deemed pharmacies. I view

and interpret the word “furnish” to mean “to be responsible for,” not be able to

control, dictate, or choose the employee’s drug provider.

Lafayette Bone & Joint Clinic v. Louisiana United Business SIF, 15-2137

(La. 6/29/16), 194 So.3d 1112, dealt with whether reimbursement was warranted for

medications prescribed by physicians and dispensed by employees of the Lafayette
Bone & Joint Clinic, an issue which tested the applicability of La.R.S. 23:1142(B).

Finding that the evidence did “not raise a tenable employee choice issue,” this Court

declined to address the choice-of-pharmacy question. Id. at 1117. There is no

dispute in the instant matter that Injured Workers’ Pharmacy is an out-of-state

provider. Louisiana Revised Statutes La.R.S. 23:1203(B) specifies the employer’s

obligation under the reimbursement schedule.

Ready and quick access to medication is essential, and the employee should

be able to choose his/her pharmacy. It is not inconceivable that the employer’s

pharmacist or the employer may insist upon the use of generic drugs or insist upon

one form of medication over another. The majority decision in this case will subject

the employee to the whim of the employer’s pharmacy, and the law does not state

such. Further, the law as written contemplates disputes over reasonableness and cost

when the choice is made by the employee, it does not contemplate a scenario such

as when the obligations of the employer imposed under La.R.S. 23:1203 are tested

by a reasonableness and cost dispute with a pharmacy chosen by the employer. This

is a matter for the legislature, whose duty it is to make the law—not the courts. It is

injudicious to read the law in order to achieve a desired result. The law, as it stands

today does not give the employer any preference over the employee to choose a

pharmacy.

2