Patrice Williams v. City of Philadelphia (WCAB); No: 277 C.D. 2023; filed Mar. 21, 2024; Judge McCullough

In this case, a workers’ compensation judge granted in part and denied in part the claimant’s Petition to Review. The judge also approved a 20% Fee Agreement between the claimant and her counsel, but as to indemnity benefits only. The judge disapproved a fee for future medical benefits, finding they were unknown costs and it could not be demonstrated that the claimant understood her potential future exposure and liability regarding those costs. The Fee Agreement allowed for 20% of all compensation payable to the claimant, including payment for all medical treatment and hospital bills. The Agreement additionally included a statement that the claimant understood that a medical provider may seek payment for 20% of the medical bills and that she had been advised by her attorney that a provider cannot do so in accordance with Section 306(f.1)(7) of the Act. Additionally, the claimant testified that the Agreement was acceptable to her and she understood there was a possibility that a medical provider might seek directly from her the 20% of the medical bill that had been reduced by the counsel fee.

The claimant appealed to the Workers’ Compensation Appeal Board (Board), and the Board affirmed. The claimant then appealed to the Commonwealth Court, which reversed the judge and the Board. In doing so, the court relied on their prior decision in Neves v. WCAB (American Airlines), 232 A.3d 996 (Pa. Cmwlth. 2020), wherein the court held that, under Section 422 of the Act, a counsel fee should be calculated against the entire award, without regard for whether it was for medical or indemnity compensation. In Neves, the court said the terms of the Fee Agreement govern and that it was incumbent upon the claimant to establish that the counsel fee be applied to the entire award, including medical compensation.

The court also addressed, for the first time, the issue of whether Section 306(f.1)(7) of the Act prohibits providers from recovering from claimants any portion of any costs related to any care or services rendered for a compensable injury, including the difference between a provider’s charge and the amount paid by an employer or insurer. According to the court, this prohibition on “balanced billing” also applies to shield claimants from medical providers seeking to recoup the 20% counsel fee deducted from an employer’s payment of medical bills.