In a dispute over a seafarer’s disability benefits, this Supreme Court decision emphasizes the crucial role of the company-designated physician and the mandatory procedure for seeking a third doctor’s opinion when conflicting medical assessments arise. The Court held that when a seafarer challenges the company doctor’s assessment, they must first request a referral to a third, independent physician, as stipulated in the Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC). Failure to comply with this procedure renders the complaint premature, underscoring the importance of adhering to contractual obligations to ensure stability in maritime labor relations. This ruling provides clarity on resolving disputes and reinforces the binding nature of the POEA-SEC in disability claim cases.

Navigating Conflicting Medical Opinions: When a Seafarer’s Claim Hinges on the Third Doctor’s Verdict

The case revolves around Benjamin Rosales, a Chief Cook hired by INC Shipmanagement, Inc. for a ten-month stint on the M/V Franklin Strait. Rosales’s employment contract was governed by the POEA-SEC, setting the stage for a dispute over disability benefits following a medical incident. During his tenure, Rosales experienced severe chest pain and breathing difficulties, eventually leading to a diagnosis of acute myocardial infarction secondary to coronary artery disease, hypertension, and diabetes mellitus. The medical issues led to his repatriation and subsequent medical evaluations, giving rise to conflicting assessments of his disability.

Upon repatriation, the company-designated physician, Dr. Cruz, assessed Rosales with a Grade 7 disability rating, indicating moderate residuals of the disorder. Dissatisfied, Rosales sought a second opinion from Dr. Vicaldo, who gave a more favorable Grade 1 disability rating, deeming him unfit to work as a seaman in any capacity. This divergence in medical opinions triggered a legal battle over the appropriate disability benefits Rosales was entitled to under the POEA-SEC. The heart of the legal matter lies in the conflicting disability assessments provided by the company-designated physician and the seafarer’s independent physician.

The Labor Arbiter (LA) initially sided with Rosales, awarding him permanent total disability benefits based on Dr. Vicaldo’s assessment and the fact that he had been unable to work for more than 120 days. However, the National Labor Relations Commission (NLRC) reversed this decision, favoring the company-designated physician’s Grade 7 rating. The NLRC emphasized that Dr. Cruz had thoroughly examined and overseen Rosales’s treatment, making his assessment more credible. This decision was subsequently appealed to the Court of Appeals (CA).

The Court of Appeals reversed the NLRC’s ruling, reinstating the LA’s decision and finding Rosales entitled to permanent total disability benefits. The CA considered the extended period during which Rosales was unable to work and the severity of his condition following two major heart operations. INC appealed the CA’s decision, arguing that the disability grading, not the duration of inability to work, should determine the benefits and that the company-designated physician’s findings should prevail. The Supreme Court was thus tasked with resolving the conflicting interpretations of the POEA-SEC and the proper procedure for assessing disability claims.

The Supreme Court addressed the interplay between Article 192(c)(1) of the Labor Code, Rule X, Section 2 of the Amended Rules on Employees’ Compensation Commission, and Section 20(B)(3) of the POEA-SEC. These provisions outline the process for determining disability benefits for seafarers. The Court emphasized that while a seafarer is entitled to temporary total disability benefits during the 120-day treatment period, the determination of permanent disability (total or partial) is based on the disability grading assigned by the physician, reflecting the resulting incapacity to work and earn wages. The duration of inability to work is a factor, but not the sole determinant.

The Court stated:

In disability compensation, it is not the injury that is compensated; it is the incapacity to work resulting in the impairment of one’s earning capacity.

The ruling underscores that disability benefits aim to compensate for the loss of earning capacity due to an illness or injury, rather than merely compensating for the injury itself. This distinction is crucial in determining the appropriate level of compensation for seafarers.

The Supreme Court emphasized the importance of the third-doctor referral provision in Section 20(B)(3) of the POEA-SEC. This provision stipulates that if the seafarer’s physician disagrees with the company-designated physician’s assessment, a third doctor may be jointly agreed upon, whose decision shall be final and binding on both parties. The Court cited Philippine Hammonia Ship Agency, Inc. v. Dumadag, emphasizing that referral to a third doctor is a mandatory procedure when conflicting medical opinions arise.

According to the Supreme Court:

If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the [e]mployer and the seafarer. The third doctor’s decision shall be final and binding on both parties.

The Court found that Rosales failed to comply with this mandatory procedure. After receiving Dr. Vicaldo’s assessment, he immediately filed a complaint for disability benefits without first seeking a referral to a third doctor. This failure to follow the POEA-SEC’s prescribed process rendered his complaint premature, undermining his claim for benefits.

The Court clarified the process for handling conflicting medical assessments:

1. Upon notification that the seafarer disagrees with the company doctor’s assessment, based on a contrary assessment from the seafarer’s own doctor, the seafarer must signify their intention to resolve the conflict by referring the assessments to a third doctor.
2. Upon notification, the company carries the burden of initiating the process for the referral to a third doctor.

Given Rosales’s failure to initiate the third-doctor referral process, the Court ruled that the company-designated physician’s assessment should prevail. Moreover, the Court noted that Dr. Cruz had thoroughly examined and treated Rosales over several months, making his assessment more credible than Dr. Vicaldo’s single-visit evaluation. Consequently, the Supreme Court granted the petition, setting aside the CA’s decision and dismissing Rosales’s complaint.

The Supreme Court’s decision underscores the importance of adhering to the procedures outlined in the POEA-SEC for resolving disability claims. By emphasizing the third-doctor referral process, the Court aims to promote fair and efficient resolution of disputes, fostering stability in maritime labor relations. This ruling serves as a reminder to seafarers and employers alike to respect contractual obligations and follow the prescribed steps for addressing conflicting medical opinions in disability claims.

FAQs

What was the key issue in this case?	The key issue was whether the seafarer was entitled to full disability compensation benefits and whether the Court of Appeals erred in favoring the findings of the seafarer’s physician over the company-designated physician.
What is the role of the company-designated physician?	The company-designated physician is tasked with assessing the fitness of a seafarer and assigning the corresponding disability benefits rating. Their assessment is considered the primary basis for determining disability benefits under the POEA-SEC.
What happens if the seafarer disagrees with the company-designated physician’s assessment?	If the seafarer disagrees, they can seek a second opinion. If a conflict persists, the POEA-SEC mandates referral to a third, independent doctor jointly agreed upon by both parties, whose decision is final and binding.
What is the significance of the third doctor’s opinion?	The third doctor’s opinion is crucial as it serves as the final and binding resolution to conflicting medical assessments. This process aims to ensure impartiality and fairness in determining the extent of the seafarer’s disability.
What is the POEA-SEC?	The Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC) is a standard employment contract that governs the terms and conditions of employment for Filipino seafarers working on foreign vessels.
What is the effect of non-compliance with the third doctor referral process?	Failure to comply with the third-doctor referral process renders the complaint premature and may result in the dismissal of the seafarer’s claim for disability benefits. The company-designated physician’s assessment will then prevail.
What is the difference between permanent total and permanent partial disability?	Permanent total disability refers to the incapacity of an employee to earn wages in the same or similar kind of work they were trained for, while permanent partial disability refers to a less severe impairment that still affects earning capacity but not to the same extent.
Is the duration of the illness a determining factor for disability benefits?	While the duration of the illness is a factor, particularly in determining temporary total disability, the final determination of disability benefits (permanent total or partial) primarily depends on the disability grading assigned by the physician.

This case underscores the critical importance of following established procedures when contesting medical assessments in disability claims. By requiring adherence to the third-doctor referral process, the Supreme Court aims to streamline dispute resolution and promote stability within the maritime labor sector.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: FORMERLY INC SHIPMANAGEMENT, INC. VS. BENJAMIN I. ROSALES, G.R. No. 195832, October 01, 2014