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New Mexico Supreme Court – Bad Decision on Temporary Total Disability


New Mexico Supreme Court Turns TTD into PTD

The New Mexico Supreme Court recently ruled that Temporary Total (TTD) can be a permanent disability.  These types of decisions are often not underwritten by the Workers Compensation carrier.

Outside of New Mexico Supreme Court Building
Wikimedia Commons – Thelmadatter

As discussed earlier in this blog, the WC insurance process is a delayed system.  The carriers have no way to immediately recover the reserving shortfalls when covering benefits that are totally unexpected.  Such a decision will likely be followed with the plaintiff bar using the decision to pursue permanent TTD benefits for their clients.

One has to wonder whatever happened to Permanent Total benefits as the proper benefit and not Permanent TTD.   According to the case Fowler v. Vista Care, an injured worker can receive Permanent Total Temporary Disability benefits – (sounds confusing?)

One of the more concerning passages from the New Mexico Supreme Court decision was:

The fact that the Legislature removed the duration limits from Section 52–1–41(A) in the same year it expressly created “temporary total disability” as a new subsection of the definition for total disability strongly suggests that the Legislature intended to classify both temporary total disability benefits and permanent total disability benefits as lifetime benefits. See State v. Davis, 2003–NMSC–022, ¶ 12, 134 N.M. 172, 74 P.3d 1064 (observing that the principle of reading statutes together to discern legislative intent “has the greatest probative force in the case of statutes relating to the same subject matter passed at the same session of the legislature”

Gavel In New Mexico Supreme Court Room

A decision that rewrites the way that Workers Compensation is underwritten and handled by claims adjusters basically out of the blue can wreak havoc on future policies.  Rewriting basic WC benefit definitions may result in sharp future premium increases. Temporary Total is just that – temporary in nature.

The New Mexico Courts issued a controversial medical marijuana decision last month.  In 2013, the Florida courts attempted to rewrite the basic definitions of Workers Comp benefits.

The worst case result is that WC carriers decide not to write business in a state due to court decisions or legislation which create a very unprofitable environment.

California is the most obvious example where carriers could not afford to write business.  SCIF ended up writing over 60% of the premiums as the insurer of last resort.

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications


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