Psychiatric Impairment Arising from COVID-19

As discussed in the prior sections, COVID-19 can result in psychiatric claims in a number of ways. For injuries on or after Jan. 1, 2013, Labor Code § 4660.1(c) states that “the impairment ratings for sleep dysfunction, sexual dysfunction, or psychiatric disorder, or any combination thereof, arising out of a compensable physical injury shall not increase.” This statute reflects the Legislature's intent as part of SB 863 to eliminate questionable claims of disability when alleged to be caused by a disabling physical injury arising out of and in the course of employment.

While there may be an issue as to whether psychiatric impairment flowing from COVID-19 is compensable under this statute, as discussed in this chapter, it is likely that it will be compensable most, if not, all of the time.

COVID-19 AS A PHYSICAL INJURY

Section 4660.1(c) bars impairment - permanent disability - for a psychiatric, sexual, or sleep disorder "arising out of a compensable physical injury." It only applies to psychiatric injury as a compensable consequence of a physical injury. It does not apply to psychiatric injuries directly caused by the employment.

Psychiatric injuries caused by "actual events of employment" pursuant to § 3208.3(b)(1), other than physical injuries, would not be barred. Therefore, psychiatric injuries caused by changes in work duties or working conditions due to COVID-19 would still be compensable. Furthermore, post-traumatic stress disorder suffered by hospital workers or other emergency personnel handling COVID-19 patients would not be barred because they do not flow from a COVID-19 diagnosis.

Section 4660.1(c) only potentially applies to psychiatric claims as a consequence of a COVID-19 diagnosis, and it highly questionable whether COVID-19 would constitute a "physical injury" for the purposes of § 4660.1(c). Employers may argue that because COVID-19 causes physical symptoms, it could be considered a "physical injury." The appeals board has held that industrially-related obesity qualifies as physical injury under § 4660.1(c), because it is physical manifestation, even if it did not arise out of a physical trauma. Therefore, if the courts accepts that physical manifestations are enough to satisfy the physical injury requirement, COVID-19 could be considered a physical injury.

However, the Labor Code differentiates between injuries and diseases. Section 3208 specifies an injury includes "any injury or disease." (Emphasis added.) Likewise, §§ 5412 and 5500.5 use the phrase "occupational diseases or cumulative injuries." (Emphasis added.) Section 3208.1 defies a cumulative injury as resulting from "repetitive mentally or physically traumatic activities." Moreover, the courts have distinguished between occupational diseases which require "exposure," and cumulative injuries which require "trauma."

Therefore, because the law recognizes a distinction between injuries and diseases, injured workers can argue that § 4660.1(c) does not apply to psychiatric injuries flowing from COVID-19, because COVID-19 is a disease not a physical injury.

LIMITATION ONLY APPLIES TO PERMANENT IMPAIRMENT

Even if COVID-19 is considered a physical injury, § 4660.1(c) only precludes permanent impairment. It expressly provides that it does not limit the ability of an injured employee to obtain treatment for a psychiatric disorder that is a consequence of a physical injury. It also does not limit an employee's ability to receive temporary disability benefits.

EXCEPTIONS TO THE BAR ON PERMANENT IMPAIRMENT

Additionally, even if COVID-19 is considered a physical injury under § 4660.1(c)(1), subdivision (c)(2) allows an employee to receive an increased impairment rating for psychiatric injury flowing from a physical injury if the psychiatric injury resulted from either:

1. Being a victim of a violent act or direct exposure to a significant violent act; or
2. A catastrophic injury, including, but not limited to, loss of a limb, paralysis, severe burn, or severe head injury.

In Wilson v. State of CA Cal Fire, the appeals board en banc held the first exception focuses on the mechanism of the injury, while the second exception focuses on the nature of the injury. In that case, the appeals board defined a "violent act" pursuant to § 4660.1(c)(2)(A) as "an act that is characterized by either strong physical force, extreme or intense force, or an act that is vehemently or passionately threatening." The appeals board held that a firefighter who fought a wildfire for several hours, during which time he had prolonged exposure to fumes and smoke resulting in an adverse physical reaction in multiple body parts, did not sustain an injury that resulted from a violent act.

Because COVID-19 is passed insidiously from person to person, it will be difficult for employees to establish the first exception is met. Short of contracting COVID-19 after being attacked by someone who has the disease, it is unlikely that psychiatric injury resulting from COVID-19 exposure would qualify as a violent act.

However, COVID-19 could potentially be a "catastrophic injury." While most people have minor symptoms and fully recover from COVID-19, for some people, the disease could cause permanent damage to the lungs. In Wilson, the appeals board concluded the firefighter's injury was catastrophic where the evidence established his injury was serious and life-threatening, he was placed in a medically-induced coma, he suffered both renal and respiratory failure, and his physical injury resulted in permanent disability that rated at 66 percent.

Thus, it is foreseeable that even if COVID-19 is considered a physical injury under § 4660.1(c)(1), some employees will be able to receive impairment for a psychiatric injury flowing from it, if the disease results in significant hospitalization and permanent impairment. This would depend on the factual setting for each case.

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