Stinson v. Ins. Co. of the State of Pennsylvania (Tex.App.- Houston [14th Dist.] Apr.
30, 2009)(Boyce) (extra-contractual claims against insurance company)(trial court erred in dismissing
her suit for want of jurisdiction based on an asserted failure to exhaust available administrative
Because Stinson exhausted her available administrative remedies regarding
appellees' disputes as to compensability and medical necessity, the trial court
had subject matter jurisdiction over the case. See Subaru, 84 S.W.3d at 221-22;
Mayhew, 964 S.W.2d at 928. Thus, the trial court erred by dismissing her suit
for want of subject matter jurisdiction. The trial court's order of dismissal for
want of jurisdiction is reversed, and the cause is remanded for further
proceedings consistent with this opinion.
REVERSED AND REMANDED: Opinion by Justice Boyce
Before Justices Brock Yates, Seymore and Boyce)
14-07-00698-CV Sue Ann Stinson v. The Insurance Company of The State of Pennsylvania,
Gallagher Bassett Services, Inc., and Belinda Ybarra
Appeal from 61st District Court of Harris County
Trial Court Judge: JOHN J. DONOVAN
S U B S T I T U T E O P I N I O N
Appellees' motion for rehearing is overruled. The opinion issued on March 24, 2009 is withdrawn.
This opinion is issued as the substitute.
Appellant Sue Ann Stinson challenges the dismissal of her suit asserting extra-contractual claims
against appellees the Insurance Company of the State of Pennsylvania, Gallagher Bassett Services,
Inc., and Belinda Ybarra. Stinson contends the trial court erred in dismissing her suit for want of
jurisdiction based on an asserted failure to exhaust available administrative remedies. We reverse
Stinson was working as a flight attendant on December 16, 2003 during a Continental Airlines flight
from Los Angeles to Honolulu. She fell backwards, hit her tailbone and head, and briefly lost
consciousness when the aircraft came to an abrupt stop as it was taxiing for departure from Los
Angeles. The flight continued as scheduled, and Stinson was examined upon arrival in Honolulu by a
doctor who diagnosed her injury as a concussion and cervical strain.
Stinson returned home to Spring, Texas, and was examined by Dr. Robert Turner. He ordered
Stinson not to work until January 1, 2004. Dr. Turner believed that Stinson's injuries would resolve
themselves without treatment, and that she would reach maximum medical improvement by February
Continental reported Stinson's injury to Gallagher Bassett, a third-party administrator for Continental's
workers' compensation carrier, the Insurance Company of the State of Pennsylvania. Gallagher
Bassett initially assigned adjuster Denise Anderson to investigate Stinson's claim; it later transferred
the claim to adjuster Belinda Ybarra. The insurance carrier paid Stinson temporary income benefits
for her two-week absence from work.
Stinson began experiencing dizziness, numbness, and pain shortly after she returned to work in
January 2004. Stinson met with Dr. Turner again and he referred her to a chiropractor, Dr. Glenn
Helton, who began treating her in January 2004. Over the next several weeks, Dr. Helton advised
Stinson to ask Dr. Turner to perform certain diagnostic tests and treatment. Dr. Turner refused these
In late April 2004, Stinson asked to change her treating physician of record from Dr. Turner to Dr.
Helton. In May 2004, Dr. Helton ordered Stinson not to work. Once Stinson began this absence from
work, the insurance carrier began paying temporary income benefits to her. Stinson underwent
X-rays and an MRI exam in May 2004, which revealed cervical spondylosis, cervical disc protrusions,
stenosis and annular tear, and lumbar disc protrusions.
In a letter dated June 15, 2004, Stinson was informed that adjuster Ybarra had asked Dr. Zvi Kalisky
to perform an independent medical examination of Stinson scheduled for July 1, 2004.
On June 30, 2004, neurologist Dr. David Tomaszek reviewed Stinson's MRI results and examined her.
Dr. Tomaszek wrote a report on the same date in which he (1) observed that Stinson had not
achieved significant improvement in the six months since her injury; and (2) recommended that
Stinson undergo treatment including physical therapy. His report states: AI have spoken to Dr. Helton
by phone, and he has agreed to carry out a cervical flexion/distraction regimen over the next couple
of weeks. I have also put this woman on a Medrol 6 day Dosepak and will see her back in mid July."
The report continues: AShould her symptoms not improve, I would recommend transforminal epidural
blocks at C4-5 and C5-6 on the right side . . . ." The report further states: AUnder the most drastic
circumstances of continued symptomatology . . . discography at C4-5, C5-6, and C6-7 could be done
. . . and if necessary . . . an anterior cervical discectomy and fusion could be considered."
Dr. Helton testified at his deposition that cervical flexion and distraction is a form of physical therapy.
The Workers' Compensation Act requires preauthorization for physical therapy treatments. See Tex.
Lab. Code Ann. § 413.014(c)(4) (Vernon 2006). Dr. Helton testified that he and Dr. Tomaszek
requested preauthorization for the recommended physical therapy. Dr. Helton also testified that he
faxed a copy of Dr. Tomaszek's June 30, 2004 report to Gallagher Bassett.
After conducting an independent medical examination of Stinson on July 1, 2004, Dr. Kalisky wrote a
report in which he disagreed with Dr. Tomaszek's recommendation for Stinson to receive physical
therapy. Dr. Kalisky opined in his July 1, 2004 report that A[n]o further treatment is recommended
other than a home-based exercise program." Dr. Kalisky described Stinson's status as Apost
contusion/strain to the cervical and lumbar spine superimposed on age-related cervical and lumbar
degenerative spondylosis. The disk protrusions noted on MRI of the cervical and lumbar spine
probably reflect preexisting degenerative disk disease."
Gallagher Bassett sent a first notice of claim dispute and refusal to pay benefits to Stinson on July 21,
2004. This first notice states: ACarrier disputes the cervical and lumbar degenerative spondylosis as
pre-existing and/or an ordinary disease of life." The July 21, 2004 notice does not address or
reference the medical necessity of physical therapy. The insurance carrier continued to pay Stinson
temporary income benefits after July 21, 2004.
Based on the July 21, 2004 notice of claim dispute, Stinson requested a benefit review conference
with the Texas Workers' Compensation Commission (ATWCC"). The TWCC selected Dr. Becky
Personett as a designated neutral physician to determine whether Stinson had reached maximum
medical improvement from her injury. On August 24, 2004, Dr. Personett examined Stinson and
concluded that she had not reached maximum medical improvement.
The TWCC also arranged for Stinson to see an orthopedic surgeon, Dr. Richard Larrey, for an
independent medical exam to determine whether Stinson's December 16, 2003 fall caused her lumbar
and cervical problems, and whether Dr. Tomaszek's recommended physical therapy was medically
necessary. Dr. Larrey examined Stinson on September 20, 2004 and reported to Ybarra that
Stinson's injuries from her fall should have resolved already, and that the requested physical therapy
was not medically necessary.
Gallagher Bassett sent a second ANotice of Disputed Issue(s) and Refusal to Pay Benefits"to Stinson
on September 23, 2004. This second notice states: ABased on Commission selected RME there is no
medical necessity for chiropractic treatment, medications other than over the counter NSAIDS,
physical therapy, injection treatment, pain management treatment, surgical treatment or further
diagnostic imaging." This second notice does not address or reference compensability. The record
contains no written communication by Gallagher Bassett to Stinson before this time denying the
physical therapy recommended by Dr. Tomaszek as being medically unnecessary.
Gallagher Bassett sent a third ANotice of Disputed Issue(s) and Refusal to Pay Benefits"to Stinson on
October 19, 2004. This third notice states: ACarrier disputes that the compensable injury extends to
and includes cervical disc protrusions and/or herniations, cervical radiculopathy, lumbar disc
protrusions and/or herniations and lumbar radiculopathy." This third notice does not address or
reference the medical necessity of physical therapy.
Dr. Personett conducted a second examination of Stinson on January 11, 2005 and disputed the
conclusions of Drs. Kalisky and Larrey. Dr. Personett again reported that Stinson had not reached
maximum medical improvement, and opined that Stinson had Acompensable injuries involving the
concussion, the cervical spine, and the lumbar spine that have made a definite difference in her life
since the moment of the injury."
In February 2005, the insurance carrier approved and began paying medical benefits for physical
On May 4, 2005, the TWCC conducted a non-binding benefit review conference. The disputed issue
at the benefit review conference is listed in the TWCC's report as follows: ADoes the 12/16/03
compensable injury extend to and include cervical disc protrusions and/or herniations, cervical
radiculopathy, cervical degenerative spondylosis, lumbar disc protrusions and/or herniations, lumbar
radiculopathy, and lumbar degenerative spondylosis?" The TWCC adopted Stinson's position and
answered this question in the affirmative. Gallagher Bassett rejected the TWCC's recommendation
from the benefit review conference. On June 15, 2005, the TWCC held a benefit contested case
hearing to decide the compensability issue addressed at the May 4 benefit review conference. The
TWCC decided the contested case hearing on compensability in Stinson's favor in conformity with the
earlier benefit review conference. The TWCC signed an order on June 22, 2005 requiring the
insurance carrier Ato pay benefits in accordance with this decision." Gallagher Bassett did not further
challenge this order regarding compensability.
Stinson sued the insurance carrier, Gallagher Bassett, and Ybarra in Harris County district court on
November 14, 2005. Stinson's original petition lists four causes of action: (1) violations of the Texas
Insurance Code; (2) breach of the common law duty of good faith and fair dealing; (3) legal malice;
and (4) violations of the Texas Deceptive Trade Practices Act (ADTPA"). Stinson seeks actual
damages including Athe consequential damages to her economic welfare from the wrongful denial
and delay of benefits; the mental anguish and physical suffering resulting from this wrongful denial of
benefits, and the other actual damages permitted by law." Stinson also seeks exemplary damages,
prejudgment interest, and DTPA treble damages and attorneys' fees.
After their earlier motion for summary judgment was denied, appellees filed a motion to dismiss
Stinson's claims for lack of subject matter jurisdiction on May 7, 2007 based on an asserted failure to
exhaust available administrative remedies. Appellees contend that Stinson was required to establish
the medical necessity of the allegedly delayed treatments as of the time Dr. Tomaszek first
recommended them during the summer of 2004. Appellees further contend that Stinson failed to
establish the medical necessity of physical therapy and failed exhaust to her administrative remedies
because preauthorization never was requested for the physical therapy treatments recommended in
Dr. Tomaszek's June 30, 2004 report.
Stinson responded to appellees' motion to dismiss on May 14, 2007, asserting that she had
adequately exhausted her administrative remedies as evidenced by the TWCC's signed order of June
22, 2005 rejecting the compensability challenge and requiring appellees to pay benefits. Stinson
contends that appellees failed to investigate her workers' compensation claim properly and wrongfully
delayed or denied payment of medical benefits, which delayed her receipt of physical therapy and
other treatment from July 2004 until February 2005. Stinson disclaims any intent to predicate her
extra-contractual claims on the medical necessity dispute; instead, she attributes the alleged delay in
receipt of treatment to Gallagher Bassett's unsuccessful pursuit of the compensability challenge.
Stinson further disclaims any effort to recover past wages, actual medical costs, or expenses for
On June 22, 2007, the district court signed an order granting appellees' motion to dismiss. Stinson
now appeals that order and challenges the dismissal of her extra-contractual claims based upon the
trial court's determination that it could not exercise jurisdiction because she had failed to exhaust her
available administrative remedies.
Stinson asserts on appeal that preauthorization of physical therapy and other treatment was
requested, and that appellees assented to the medical necessity of Dr. Tomaszek's recommended
course of treatment once they began paying for physical therapy in February 2005. According to
Stinson, this assent to the medical necessity of Dr. Tomaszek's recommended treatment left
compensability as the only disputed issue. Stinson further asserts that she had no administrative
remedies left to exhaust following the TWCC's signed order of June 22, 2005 determining
compensability in her favor and requiring appellees to pay benefits.
Standard of Review
Determining whether a court has subject matter jurisdiction § including exhaustion of administrative
remedies § is treated as a question of law and reviewed de novo. See Subaru of Am., Inc. v. David
McDavid Nissan, Inc., 84 S.W.3d 212, 222 (Tex. 2002); Mayhew v. Town of Sunnyvale, 964 S.W.2d
922, 928 (Tex. 1998); Kelly v. Am. Interstate Ins. Co., No. 14-07-00083-CV, 2008 WL 5085138, at *2
(Tex. App.-Houston [14th Dist.] Nov. 25, 2008, pet. filed) (mem. op., not designated for publication)
(citing Tex. Dep't of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004)).
A plea to the jurisdiction challenging exhaustion of administrative remedies under the workers'
compensation scheme can rest on the pleadings, or on evidence. Combined Specialty Ins. Co. v.
Deese, 266 S.W.3d 653, 657 (Tex. App.- Dallas 2008, no pet.) (citing Miranda, 133 S.W.3d at 226);
see also Kelly, 2008 WL 5085138, at *2; Schwartz v. Ins. Co. of Penn., 274 S.W.3d 270, 273-74
(Tex. App.- Houston [1st Dist.] 2008, pet. denied).
"When a plea to the jurisdiction challenges the pleadings, we determine if the pleader has alleged
facts that affirmatively demonstrate the court's jurisdiction to hear the case." Deese, 266 S.W.3d at
657 (citing Miranda, 133 S.W.3d at 226). The reviewing court "must look to the allegations in the
pleadings, liberally construe them in the plaintiff's favor, and look to the pleader's intent." Kelly, 2008
WL 5085138, at *2 (citing Miranda, 133 S.W.3d at 226). "If the pleadings do not contain sufficient
facts to affirmatively demonstrate the trial court's jurisdiction but do not affirmatively demonstrate
incurable defects in jurisdiction, the issue is one of pleading sufficiency and the plaintiffs should be
afforded the opportunity to amend." Id. (citing Miranda, 133 S.W.3d at 226-27).
When a plea to the jurisdiction challenges the existence of jurisdictional facts, we consider relevant
evidence submitted by the parties. Id. (citing Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555
(Tex. 2000)); see also Deese, 266 S.W.3d at 657. The standard of review for a jurisdictional plea
based on evidence "'generally mirrors that of a summary judgment under Texas Rule of Civil
Procedure 166a(c).'"Deese, 266 S.W.3d at 657 (quoting Miranda, 133 S.W.3d at 228). Under this
standard, we credit evidence favoring the non-movant and draw all reasonable inferences in the
non-movant's favor. See id. at 659 (citing Miranda, 133 S.W.3d at 228).
Workers' compensation benefits may be disputed - among other grounds - based on (1)
compensability of the injury; and (2) medical necessity of the treatment recommended for a
compensable injury. See 28 Tex. Admin. Code §§ 133.305(a)(1)(B) (2004) (Tex. Workers' Comp.
Comm'n, Medical Dispute Resolution § General), 140.1(1) (2004) (Tex. Workers' Comp. Comm'n,
Definitions). A workers' compensation insurance carrier must provide written notice of the specific
grounds on which it refuses to pay benefits. Tex. Lab. Code Ann. § 409.021(a)(1), .022(a) (Vernon
Appellees provided three written notices of dispute regarding Stinson's claim. The first and third
notices § dated July 21, 2004 and October 19, 2004, respectively § disputed the compensability of
Stinson's injury because they challenged whether all of Stinson's cervical and lumbar conditions were
attributable to her fall on December 16, 2003. The second notice - dated September 23, 2004 -
disputed the medical necessity of Dr. Tomaszek's recommended treatment for Stinson's cervical and
A party must exhaust all administrative remedies before seeking a judicial remedy when, as here, an
administrative agency has exclusive jurisdiction. Subaru, 84 S.W.3d at 221. The exhaustion
requirement ensures that the administrative agency has the opportunity to resolve disputed fact
issues within its exclusive jurisdiction before a court must address those issues. See Essenburg v.
Dallas County, 988 S.W.2d 188, 189 (Tex. 1998) (per curiam). Because this case involves the
interplay of two separate disputes - one focusing on compensability and another on medical necessity
- it is helpful to describe the different resolution procedures that apply here under separate chapters
of the Workers' Compensation Act.
A. Exhaustion of Administrative Remedies Regarding Compensability
Chapter 410 of the Workers' Compensation Act addresses disputes regarding compensability and
extent of injury. This chapter establishes a four-tier system for the disposition of claims by the TWCC.
Tex. Mut. Ins. Co. v. Ruttiger, 265 S.W.3d 651, 657 (Tex. App.-Houston [1st Dist.] 2008, pet. filed).
In the first tier, the parties participate in a non-binding benefit review conference designed to mediate
and resolve disputed issues by agreement of the parties. Id. (citing Tex. Lab. Code Ann. §§
410.021-.034 (Vernon 2006 & Supp. 2007)). In the second tier, a party may seek a contested case
hearing with the TWCC to decide any issues not resolved by agreement or through the benefit review
conference. Id. (citing Tex. Lab. Code Ann. §§ 410.104, .151-.169 (Vernon 2006 & Supp. 2007)). In
the third tier, the party who loses at the contested case hearing may seek review by an administrative
appeals panel. Id. (citing Tex. Lab. Code Ann. §§ 410.201-.208 (Vernon 2006 & Supp. 2007)). In the
fourth and final tier, a party may seek judicial review of issues regarding final decisions of disputes
adjudicated by the TWCC. Id. (citing Tex. Lab. Code Ann. §§ 410.251-.308 (Vernon 2006 & Supp.
B. Exhaustion of Administrative Remedies Regarding Medical Necessity
Certain medical treatments and services, including physical therapy, require a claimant or health care
provider to seek preauthorization from the insurance carrier under chapter 413 of the Workers'
Compensation Act and accompanying regulations. See Tex. Lab. Code Ann. § 413.014(c)(4), (d)
(Vernon 2006); 28 Tex. Admin. Code § 134.600(e) (2004) (Tex. Workers' Comp. Comm'n,
Preauthorization, Concurrent Review, and Voluntary Certification of Health Care).
"The TWCC has jurisdiction over disputes involving preauthorization of medical care and
reimbursement of medical expenses." Kelly, 2008 WL 5085138, at *4 (citing Am. Motorists Ins. Co. v.
Fodge, 63 S.W.3d 801, 803 (Tex. 2001)). "A claimant must exhaust all administrative remedies with
the TWCC before suing an insurer on statutory and tort claims alleging denials, delays, interruptions,
and premature terminations of medical treatment." Kelly, 2008 WL 5085138, at *4 (citing Fodge, 63
S.W.3d at 804, and Pickett v. Tex. Mut. Ins. Co., 239 S.W.3d 826, 832 (Tex. App.- Austin 2007, no
Preauthorization requests may be made by telephone, facsimile, or electronic transmission. 28 Tex.
Admin. Code § 134.600(e)(1). An insurance carrier must approve or deny a preauthorization request
and provide notice of its decision to the claimant or health care provider by telephone, facsimile, or
electronic transmission within three working days of receipt of the request. Id. § 134.600(f)(1), (3)(A).
The insurance carrier must send written notice of its decision to the employee or her representative
within one working day of the decision. Id. § 134.600(f)(4). A preauthorization denial must include
"the description or source of screening criteria used, the principal reasons, and clinical basis for
making the denial . . ."along with Aplain language notifying the employee of the right to timely request
reconsideration . . . ." Id. §14-07-00698-CV 134.600(f)(6)(A), (B).
If an insurance carrier denies preauthorization, the claimant or health care provider may request
reconsideration within 15 working days of receipt of a written denial and must document the
reconsideration request. Id. § 134.600(g)(1). The insurance carrier must respond to a request for
reconsideration within five working days of receipt of the request. Id. § 134.600(g)(2)(A).
If reconsideration is denied, a health care provider or employee may appeal the denial by filing with
the TWCC a request for medical dispute resolution by an independent review organization. Id. §
134.600(g)(3). Medical necessity disputes are categorized as "prospective"or "retrospective." 28 Tex.
Admin. Code § 133.305(a)(1)(B)(i), (ii).
The parties agree that the dispute at issue here regarding Dr. Tomaszek's recommended treatments
is a prospective medical necessity dispute. Prospective disputes involve review of the medical
necessity of health care requiring preauthorization, and are reviewed by an independent review
organization pursuant to 28 Texas Administrative Code section 133.308. Id. § 133.305(a)(3).
Prospective disputes include a provider or injured employee's dispute of an insurance carrier's denial
of preauthorization under 28 Texas Administrative Code section 134.600 made before provision of the
disputed medical services. Id. § 133.305(a)(3)(A).
A request for prospective necessity dispute resolution must be filed no later than the 45th day after
the date the insurance carrier denied the party's request for reconsideration of the denial of
preauthorization. Id. § 133.308(e)(2) (2004) (Tex. Workers' Comp. Comm'n, Medical Dispute
Resolution by Independent Review Organizations). The party who fails to timely file a request for
independent review of a medical necessity dispute with the TWCC waives the right to independent
review or medical dispute resolution. Id. § 133.308(d), (e).
The independent review organization must review and render a decision on a prospective necessity
dispute by the 20th day after the independent review organization (1) receives the dispute, or (2)
receives a designated doctor examination if one has been requested. Id. § 133.308(o). A party to a
prospective necessity dispute may appeal the independent review organization decision by filing a
written request for a hearing with the State Office of Administrative Hearings. Id. § 133.308(u). A
party who has exhausted administrative remedies and who is aggrieved by a final decision of the
State Office of Administrative Hearings may seek judicial review of the decision. Id. § 133.308(u)(7).
If the insurance carrier has raised a compensability dispute, the resolution of a request for review by
an independent review organization will be abated until the compensability dispute is resolved. Id. §
133.308(f)(7). The TWCC may dismiss a request for medical necessity dispute resolution if the
dispute no longer exists. Id. § 133.308(i)(1). The TWCC cannot prohibit parties from voluntarily
agreeing to pay for medical services that would otherwise require preauthorization, and any such
agreements create liability for those agreed services on the part of the insurance carrier. Tex. Lab.
Code Ann. § 413.014(f) (Vernon 2006).
C. Did Stinson Exhaust Administrative Remedies?
It is undisputed that Stinson exhausted her administrative remedies with respect to compensability
under chapter 410.
The carrier challenged compensability through the second tier of the resolution procedure, a
contested case hearing. The TWCC hearing officer signed an order on June 22, 2005 requiring
appellees to pay benefits based on a determination that the compensable injury from Stinson's
December 16, 2003 fall encompassed her cervical and lumbar conditions. Appellees did not
challenge this compensability determination further by using the procedures available under tier three
or tier four.
2. Medical necessity of physical therapy
Despite Stinson's exhaustion of administrative remedies with respect to compensability, appellees
contend that dismissal for lack of jurisdiction nonetheless was mandated. Appellees argue that
Stinson was required to exhaust not only the administrative remedies addressing compensability
under chapter 410, but also the administrative remedies addressing medical necessity under chapter
Specifically, appellees argue that Stinson failed to request preauthorization of the physical therapy
recommended in Dr. Tomaszek's June 30, 2004 report as required under the Workers' Compensation
Act and accompanying regulations. See Tex. Lab. Code Ann. § 413.014(c)(4), (d); 28 Tex. Admin.
Code § 134.600(e). Appellees further argue that Stinson's asserted failure to request
preauthorization forecloses her from establishing the medical necessity of physical therapy as of July
2004. Absent a determination that physical therapy was medically necessary when first sought in July
2004, appellees argue that Stinson cannot predicate her extra-contractual claims on a delay in
receiving physical therapy between July 2004 and February 2005. See Schwartz, 274 S.W.3d at 274
(A>The fact that the . . . surgery w[as] ultimately authorized does not constitute any type of
determination by the Commission that the initial denial . . . [was] improper. Therefore, there does
remain a dispute for the Commission to resolve.'") (quoting In re Tex. Mut. Ins. Co., No.
05-05-00944-CV, 2005 WL 1763562, at *2 (Tex. App.CDallas July 27, 2005, orig. proceeding) (mem.
Stinson responds that Drs. Helton and Tomaszek specifically requested that Gallagher Bassett
approve Dr. Tomaszek's treatment plan, and that Gallagher Bassett was aware of the June 30, 2004
report. Stinson also relies on In re Texas Workers' Compensation Insurance Fund, 995 S.W.2d 335,
337 (Tex. App.CHouston [1st Dist.] 1999, orig. proceeding [mand. denied]), and Ruttiger, 265 S.W.3d
at 656-58, to argue that the carrier's assent to physical therapy in February 2005 exhausts
administrative remedies with respect to medical necessity regardless of whether preauthorization was
requested in 2004.
Under these opinions, when the Commission, claimant, and carrier agree on the claimant's entitlement
to compensation benefits, their agreement is binding as a final determination that the benefits are
owed, precluding the need for the claimant to seek administrative remedies before he can sue for
damages arising from the carrier's unreasonable delay or denial of benefits.
Schwartz, 274 S.W.3d at 274 (citing Ruttiger, 265 S.W.3d at 657-58, and In re Tex. Workers' Comp.
Ins. Fund, 995 S.W.2d at 337).
Stinson stresses that the governing regulations provided for abating a request for determination of
medical necessity by an independent review organization until compensability has been resolved by a
final decision of the TWCC. See 28 Tex. Admin. Code § 133.308(f)(7). By the time compensability
was determined in June 2005, the insurance carrier voluntarily had been paying for Stinson's physical
therapy for about four months. Stinson contends that she was not required to pursue an
administrative determination in 2004 concerning the medical necessity of physical therapy for which
the carrier already had agreed to pay by the time compensability was determined in her favor in June
Resolution of this appeal does not require choosing between the parties' competing positions
regarding the need to pursue preauthorization in 2004. Even assuming that Stinson had to request
preauthorization in 2004 as a prerequisite for a suit claiming that an unwarranted compensability
challenge delayed her receipt of Dr. Tomaszek's recommended treatment until 2005, we conclude
that the evidence submitted to the trial court suffices under the standard of review to demonstrate
such a request.
Dr. Helton was questioned at length during his deposition about whether preauthorization for physical
therapy had been requested.
Q. Do you C did you ever request or did you ever request preauthorization for any treatment for
A. Did we request treatment for her? Yes. Yes. I basic C yes. We requested C in other words,
we requested treatment for physical therapy.
* * *
Q. . . . The question I'm asking is: Specifically, was there a request for preauthorization made on
behalf of Ms. Stinson for any treatment?
Q. Okay. What specifically was requested in terms of treatment for Ms. Stinson?
A. We requested physical therapy. And, in fact, Dr. Tomaszek, the neuro I referred them to C a
lot of C a lot of requests that were made were actually recommended by the neuro [and] . . . Moran,
the orthopedic doc. Most of the requests and recommendations were made by those guys. . . .
* * *
Q. . . . This is what I've marked as Helton Exhibit 2. . . . This is the report of Dr. Tomaszek, dated
June 30, 2004; is that correct, Dr. Helton?
A. I'm sorry. Dated 30th of >04, yes.
Q. Have you seen this report before?
Q. Okay. Is this the C the report that lays out sort of what the plan that you and Dr. Tomaszek
formed for Ms. Stinson's treatment?
A. At this particular time, that's what he was recommending, yes.
Q. Okay. Was there anything about the plan he laid out in this that you disagreed with?
A. No, sir.
Q. Did you provide any other written report to Gallagher Bas[s]ett or Ms. Stinson that would
indicate what your plan for treatment was?
A. I faxed her this.
A. She got this.
* * *
Q. Okay. If you'll go to the next page, which is the second one.
Q. The first three paragraphs in this § on this page actually address sort of what you're going to
do for her cervical spine injury. Is that a fair assessment?
A. That's what he was recommending, yes.
Q. Okay. Did you agree with this plan that Dr. C
Q. Tomaszek put together?
Q. Okay. The first thing is . . . cervical flexion and distraction regimen. Can you C is that a form
of physical therapy?
A. Yes it is.
* * *
Q. What C what does C what would a request C well, what did your request for this type of
treatment C a request for preauthorization for this type of treatment, what did that look like?
A. I faxed this to them.
Q. Okay. Who is Athem?"
A. Oh, Gallagher Bas[s]ett. Sorry.
Q. Okay. And did that C did you accompany that with a letter or a phone call and say, Alook, this
is C the treatment that's being outlined is in here"?
A. We C we faxed this to them. These were the findings from him . . . .
Dr. Helton did not identify the date on which he faxed Dr. Tomaszek's June 30, 2004 report to
Gallagher Bassett. During Stinson's deposition, reference was made to the fax code on a copy of Dr.
Tomaszek's June 30, 2004 report indicating that Gallagher Bassett received a copy of that report by
fax on July 12, 2004. It is not clear from the record whether this fax came from Dr. Helton or Dr.
The appellees dispute whether this evidence establishes a proper preauthorization request.
However, the standard of review governing this appeal parallels the summary judgment standard.
Insofar as evidence of jurisdictional facts is at issue, we must credit evidence favoring the non-movant
and draw all reasonable inferences in the non-movant's favor. See Deese, 266 S.W.3d at 659 (citing
Miranda, 133 S.W.3d at 228). Applying this standard of review, we conclude that the evidence set
forth above suffices for purposes of appeal to establish that preauthorization was requested.
The appellees assail this conclusion on rehearing, contending that (1) the court Adetermined"that the
June 30, 2004 report constituted a preauthorization request; (2) the June 30, 2004 report lacks
certain details specified under 28 Texas Administrative Code section 134.600(e)(2); and (3) ADr.
Helton's belief he requested preauthorization does not constitute valid evidence of jurisdiction."
Appellees assert that ADr. Helton . . . did not provide Gallagher Bassett with any additional
information relating to the allegedly requested treatment." Appellees further assert that A[p]laintiff
failed to present any evidence to suggest Dr. Helton made any effort to expound on the June 30th
report such that Gallagher Bassett could have even identified it as a preauthorization request."
The appellees' real quarrel is with the standard of review that controls our disposition. When they
assert that Athe Appellant failed to furnish any evidence which suggests anyone, including Dr. Helton,
supplemented the June 30th report with the missing elements,"the appellees ask the court to infer a
lack of specific details from unlimited testimony that Dr. Helton and others requested preauthorization
for physical therapy. We are required to draw reasonable inferences in favor of the non-movant, not
against her. There is no one required means of transmitting a preauthorization request; written and
oral communications both suffice. See 28 Tex. Admin. Code § 134.600(e)(1). Based on unlimited
testimony that preauthorization was requested by multiple persons, it is reasonable to infer that such
requests were specific enough in conjunction with the June 30, 2004 report to provide the needed
details. See, e.g., Hand v. Dean Witter Reynolds Inc., 889 S.W.2d 483, 493 n.6 (Tex. App.CHouston
[14th Dist.] 1994, writ denied) (rejecting appellees' contention that investor's request to broker to
purchase oil option contracts was insufficiently specific because investor did not set a time for
expiration of the options; A[f]or the purposes of this appeal, we accept appellant's position that [the
investor] . . . did attempt to place an order.").
The record contains no evidence of a written denial of preauthorization from the carrier. See 28 Tex.
Admin. Code § 134.600(f)(1), (4), (6). The notice dated September 23, 2004 is a notification of
refusal to pay rather than a written denial of preauthorization. See Tex. Lab. Code § 409.021(a)(2),
.022(a). Even if this notice could be construed generously as a written denial of preauthorization, the
notice does not comply with the timetables for a written denial of preauthorization. See 28 Tex.
Admin. Code § 134.600(f)(3), (4). The claimant's deadlines for seeking reconsideration by the carrier
and then filing a request for medical dispute resolution by an independent review organization are
keyed to the claimant's receipt of a timely written denial of preauthorization. See 28 Tex. Admin. Code
§§ 133.308(d), (e)(2); 134.600(g)(1), (2)(A), (3). Absent receipt of a timely written denial of
preauthorization, Stinson's deadlines did not begin to run and the provision regarding waiver of the
right to independent review or medical dispute resolution is inapplicable. See 28 Tex. Admin. Code §
These circumstances distinguish Stinson's situation from cases in which the claimant (1) reached an
agreement with the carrier regarding compensability or other disputes, but (2) nonetheless failed to
exhaust administrative remedies with respect to medical necessity by failing to submit denied
preauthorization requests for administrative review. Cf. Kelly, 2008 WL 5085138, at *9
(AConsequently, even if appellees had expressly agreed to provide Kelly with medical benefits, they
would still retain the right to require preauthorization of the spinal fusion under the Act. Because
Kelly, like the Pickett claimant, did not submit any denied preauthorization requests to the TWCC, he
has failed to exhaust his administrative remedies under the Act."); see also Schwartz, 274 S.W.3d at
274-76; Pickett, 239 S.W.3d at 836-37. Here, the record contains no written denial of
preauthorization upon which further steps in the administrative review process were predicated. The
circumstances here also are distinguishable from those in which a claimant begins the administrative
medical dispute resolution process but does not pursue that process to completion. Cf. Malish v. Pac.
Employers Ins. Co., 106 S.W.3d 744, 746 (Tex. App.CFort Worth 2003, no pet.).
This case is more closely analogous to Ruttiger, 265 S.W.3d at 655-56, in which the carrier originally
denied medical and income benefits. The parties later entered into a benefit dispute agreement
stipulating that ARuttiger sustained a compensable injury in the form of a hernia and that Ruttiger
suffered a disability for a specific period of time." Id. Ruttiger asserted extra-contractual claims
stemming from the insurance carrier's delay in paying medical and income benefits. Id. at 656. The
First Court of Appeals held that the trial court had jurisdiction because the benefit dispute agreement
constituted a final determination that benefits were due, and Athere is no suggestion in the record
that, following the parties' entry into the Benefit Dispute Agreement, any dispute remained regarding
what specific benefits Ruttiger was entitled to recover." Id. at 658 n.8.
Here, too, there is no indication that any dispute remained for administrative resolution with respect to
the medical necessity of physical therapy after February 2005, when the carrier assented to this
treatment and began paying for it.
Medical necessity of physical therapy as of July 2004, when it was first requested, no longer was at
issue because the carrier did not send a written denial in response to Stinson's preauthorization
requests. There were no further administrative review procedures for Stinson to exhaust as to that
issue because her obligations were keyed to the receipt of a written preauthorization denial that was
not sent. Medical necessity of physical therapy from February 2005 forward no longer was at issue
in light of the carrier's assent. See Tex. Lab. Code § 413.014(f) (AThe division may not prohibit an
insurance carrier and a health care provider from voluntarily discussing health care treatment and
treatment plans . . . and may not prohibit an insurance carrier from certifying or agreeing to pay for
health care consistent with those agreements. The insurance carrier is liable for health care
treatment and treatment plans . . . that are voluntarily preauthorized and may not dispute the certified
or agreed-on preauthorized health care treatment and treatment plans . . . at a later date."); see also
In re Tex. Workers' Comp. Ins. Fund, 995 S.W.2d at 337 (AWe find no requirement under the Act
which would require a claimant to continue through . . . the disposition process if the parties agree on
the claimant's compensation benefits at an earlier stage in the process.").
We sustain Stinson's issue regarding dismissal of her case for want of jurisdiction based upon the
exhaustion of remedies doctrine.
Because Stinson exhausted her available administrative remedies regarding appellees' disputes as to
compensability and medical necessity, the trial court had subject matter jurisdiction over the case.
See Subaru, 84 S.W.3d at 221-22; Mayhew, 964 S.W.2d at 928. Thus, the trial court erred by
dismissing her suit for want of subject matter jurisdiction. The trial court's order of dismissal for want
of jurisdiction is reversed, and the cause is remanded for further proceedings consistent with this
/s/ William J. Boyce
Panel consists of Justices Yates, Seymore, and Boyce.
 The Texas Workers' Compensation Commission was replaced in 2005 by the Texas
Department of Insurance, Division of Workers' Compensation. See Tex. Lab. Code Ann. § 402.001
 Dr. Helton administered physical therapy to Stinson approximately 49 times without pay
between July 21, 2004 (the date of Gallagher Bassett's first notice of dispute and refusal to pay
benefits) and February 2, 2005 (the date of Stinson's first physical therapy treatment with Kinetics
3 Several sections of the Workers' Compensation Act pertaining to disputes were amended
effective September 1, 2005. See Act of June 1, 2005, 79th Leg., R.S., ch. 265, §§ 3.146, .153-.208,
2005 Tex. Sess. Law Serv. 469, 533-43 (to be codified at Tex. Lab. Code Ann. §§ 409.022(c),
410.021-.308). None of these amendments substantively changed the dispute process described in
Ruttiger. See id.
4 From January 2, 2002 until December 31, 2006, this regulation stated: A[I]f the carrier has
raised a dispute pertaining to liability for the claim, compensability, or extent of injury . . . the request
for [review of a medical necessity claim] will be held in abeyance until those disputes have been
resolved by a final decision of the [TWCC]." 28 Tex. Admin. Code § 133.308(f)(7). We decide this
case under the regulations in place in 2004. See 28 Tex. Admin. Code § 133.308(a)(1) (2009) (Tex.
Dep't of Ins., Div. of Workers' Comp., MDR by Independent Review Organizations).
 To the extent that appellees challenge a failure to plead this jurisdictional fact in the original
petition, the proper remedy is a remand and an opportunity to replead. Kelly, 2008 WL 5085138, at
*2 (AIf the pleadings do not contain sufficient facts to affirmatively demonstrate the trial court's
jurisdiction but do not affirmatively demonstrate incurable defects in jurisdiction, the issue is one of
pleading sufficiency and the plaintiffs should be afforded the opportunity to amend.").
 We do not address exhaustion of administrative remedies under circumstances in which the
carrier has denied preauthorization in conformity with chapter 413 and the accompanying regulations,
and thereby placed the onus on the claimant to undertake further steps in the administrative review