In response to concerns regarding the lack of predictability or objective standards in workers' compensation awards for permanent impairment, on September 20, 2007, South Carolina Governor Mark Sanford signed Executive Order 2007-16, directing the South Carolina Workers' Compensation Commission and its individual commissioners to "strictly apply either AMA Guides or any other accepted medical treatise or authority in making their injury compensation determinations" in contested cases. Executive Order 2007-16 also requires that on a quarterly basis beginning on January 1, 2008, the South Carolina Workers' Compensation Commission and its individual commissioners are to provide written confirmation, to the Office of the Governor, that they have used such objective standards in rendering compensation awards in the preceding quarter. Executive Order 2007-16 is effective immediately.
The impact of Executive Order 2007-16 remains to be seen. However, the clear intent and import of the order is to bring objective standards to workers' compensation awards and to place some limitations on the wide discretion otherwise enjoyed by commissioners in rendering awards for permanent impairment. Generally speaking, Executive Order 2007-16, if applied as intended, would limit an injured worker's recovery for permanent impairment to the impairment rating provided by his or her healthcare provider, assuming the rating is consistent with the AMA Guides or any other accepted medical treatise or authority.
Notably, the Governor's legal authority to issue such an executive order and the extent of its impact has been questioned by some and a legal challenge may very well come in the near future. Ogletree Deakins will continue to keep you informed on developments in this area.