June 1, 2023Share
DO I NEED TO SEND A 120-DAY LETTER TO PAY AND INVESTIGATE? WE HAVE THE ANSWER!
By Robert D. Friedman, Esq.
Partner/Business Unit Leader
On May 31, 2023, the First District Court of Appeal (DCA) settled a long-standing debate regarding the 120-day pay and investigation provision of Florida Statutes. In a decision that will impact every employer, carrier, and third-party administrator handling workers’ compensation claims, Florida’s 1st DCA has established the necessity of sending a 120-day letter to invoke the statutory pay and investigate provision.
To arrive at this pivotal decision, the 1st DCA considered Churchill v. DBI Services, LLC and Corvel Corporation, No. 1D21-3199 (1st DCA, May 31, 2023), in which the Claimant sustained a workplace accident on November 1, 2020. The Carrier accepted the claim as compensable on November 13, 2020, after which it paid for prescriptions on November 10, 2020, and commenced payment of indemnity benefits on November 13, 2020. Indemnity and medical benefits continued to be paid through February 7, 2021. Then, on January 8, 2021, the Employer/Carrier sent a 120-day pay and investigate letter to the Claimant and her attorney, advising of the conditional acceptance of the claim. A Notice of Denial was later issued on February 24, 2021. The Claimant argued that the Employer/Carrier failed to comply with the pay and investigate provisions set forth in Florida Statutes § 440.192(8) and § 440.20(4).
Before the DCA was the fundamental question: “how is a claimant who receives those benefits to know if an employer/carrier has chosen to ‘pay and investigate’ or simply to pay outright?” In responding to this question, the DCA determined that carriers have a “statutory obligation” under 440.20(4) to send a 120-day letter-that the 120-day letter invokes the statutory right to pay and investigate.
It is crucial to note also determined the 120-day letter must be timely and defined timely as “[u]pon commencement of payment.” Thus, the Employer/Carrier is now required to send the 120-day letter “. . . either at the time of making the payment or as soon thereafter as reasonably practicable.”
We expect the term “reasonably practicable” will be a source of debate and litigation going forward. In Churchill, the fifty-nine days that elapsed was considered “too long.” Employer/Carrier’s should, therefore, make every effort to send out the 120-day letter upon the initial payment of benefits, or in extremely close proximity to that date to avoid any argument regarding timeliness.
It is important to note that, in Churchill, the underlying claim was denied, in contrast to the ruling in Checkers Restaurant v. Wiethoff, 925 So.2nd 348 (Fla. 1st DCA, 2006), which was distinguished by the Court within the instant opinion. This distinction seems to leave open the issue as to whether a 120-day letter is required if the pay and investigate provision of the statute is invoked in a compensable claim where only entitlement to certain benefits remains at issue.
While the Churchill decision is definitive on some issues, questions remain as to what will be considered reasonably practicable and to the holding’s applicability to compensable claims.
If you are handling a workers’ compensation claim and need to determine the correct course of action, call one of our experienced workers’ compensation defense attorneys today for personalized guidance. Our team has the knowledge and expertise to navigate the ever-changing landscape of Florida’s workers’ compensation law.