.

Defense Digest

New Jersey Medical Provider Claims Are Contingent Upon Jurisdiction Over Underlying Claim

Defense Digest, Vol. 27, No. 1, January 2021

January 29, 2021

by Kiara K. Hartwell

Key Points:

  • For a New Jersey workers’ compensation court to have jurisdiction over Medical Provider claims, there must be jurisdiction over an underlying claim.
  • Jurisdiction can be determined by place of injury, place of contract, place of employment, place where industry is localized, place of residency, place decided on by a contract or place of sufficient contacts.
  • The Appellate Division cautions litigants against disrespectful characterizations of unfavorable decisions by workers’ compensation judges.

In a recently consolidated appeal, the New Jersey Appellate Division clarified the scope of jurisdiction granted to workers’ compensation courts in medical provider claims. The New Jersey Workers’ Compensation Act provides “[e]xclusive jurisdiction” to the courts over disputed medical charges “arising from any claim for compensation for a work-related injury or illness.” Although the jurisdiction inquiry is fact-sensitive, the Appellate Division went further to explain that a single day of treatment in New Jersey was insufficient without any other contacts.

In the first of the two consolidated cases, Anesthesia Assoc. of Morristown, PA v. Weinstein Supply Corp., 2020 WL 5944009 (N.J. Super. App. Div. Oct. 7, 2020), Anesthesia Assoc. of Morristown, PA provided services to an injured worker at a New Jersey hospital on March 22, 2018. The underlying workers’ compensation claim was filed in Pennsylvania because the accident occurred in Pennsylvania, the injured worker was a resident of Pennsylvania, and Weinstein Supply Corp. was based in Pennsylvania. Anesthesia Assoc. submitted a claim to the Pennsylvania Department of Labor and Industry and received a payment per the applicable fee schedule. It subsequently sought payment of the balance from Weinstein’s insurance carrier.

When Weinstein’s insurer failed to make payment on the balance, Anesthesia Assoc. filed a Medical Provider claim in New Jersey. Weinstein filed a motion to dismiss for lack of jurisdiction, which the New Jersey workers’ compensation court ultimately granted. In doing so, the court concluded it did not have personal jurisdiction over the underlying workers’ compensation claim because none of the “Larson factors” (found in Williams v. Port Auth. of N.Y. & N.J., 175 N.J. 82, 87-88 (2003)) applied:

[the employee] lived in [Pennsylvania], worked in [Pennsylvania], and the accident occurred in [Pennsylvania]. The contract of hire occurred in [Pennsylvania]. No contract exists between [Anesthesia Assoc.] and Weinstein. The only connection to New Jersey is that [the employee] underwent one day of medical treatment with [Anesthesia Assoc.] in New Jersey.

The court explained that, just as the courts have found an injured worker’s New Jersey residence alone was insufficient for jurisdiction, “one day of treatment in New Jersey” was also insufficient.

In the second case, Surgicare of Jersey City v. Waldbaums, 2020 WL 5944009 (N.J. Super. App. Div. Oct. 7, 2020), the injured worker, a resident of New York, was injured in New York while working for his New York employer, Stop & Shop. The worker filed a claim in New York and, on August 11, 2017, underwent surgery at Surgicare of Jersey City. Surgicare submitted a claim for payment in New York and subsequently filed a Medical Provider claim in New Jersey. Similar to Weinstein, Waldbaums filed a motion to dismiss for lack of jurisdiction. Surgicare argued that Waldbaums did business in New Jersey and that treatment was rendered in New Jersey, establishing jurisdiction there. However, the New Jersey workers’ compensation court granted Waldbaums’ motion, noting that the injured worker “was directed by his New York doctor to a surgical center in New Jersey for a single, one-day visit. The patient’s same-day surgery was performed by a New York doctor using equipment and devices ordered by the New York doctor.” The judge ruled that this single day of treatment was insufficient to “rise to the standard of sufficient purposeful minimal contacts” for personal jurisdiction.

In reviewing the consolidated appeals, the Appellate Division concluded that “[u]nless the Division [of Workers’ Compensation] has jurisdiction over the underlying claim for a compensable work-related injury, it does not have jurisdiction over a [Medical Provider claim] for payment.” After applying the six “Larson factors” to both cases, the Appellate Division agreed with the workers’ compensation courts in finding that no jurisdiction existed for either claim and held that both were appropriately dismissed.

Finally, feeling compelled to comment on various hyperbolic and inflammatory remarks in the appellants’ briefs, the Appellate Division cautioned against baseless, future attacks accusing the workers’ compensation judges of either abusing their authority or rendering incoherent or preposterous decisions. It was noted that such comments were unwarranted and did little to advance a client’s position, while, on the other hand, eroding the public’s trust in the judiciary.

As these cases illustrate, medical providers seeking reimbursement must establish jurisdiction over the underlying workers’ compensation claim. Although this is a fact-sensitive inquiry, these cases confirm that New Jersey workers’ compensation courts require, at the very least, more than a single day of treatment in New Jersey. The inquiry going forward will be whether two days of treatment or other similar examples will be sufficient bases for jurisdiction. In order to avoid any possibility of paying under the New Jersey payment scheme, where there is no set fee schedule, employers and carriers handling non-New Jersey claims should strive to direct care within their respective states as much as possible. This is not only because whether New Jersey has jurisdiction is fact-sensitive to each case, but also because New Jersey has no fee schedule and only pays the “usual and customary charges” for services.

*Kiara is an associate in our Mount Laurel, New Jersey office. She can be reached at (856) 414-6404 or kkhartwell@mdwcg.com.

Defense Digest, Vol. 27, No. 1, January 2021 is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2021 Marshall Dennehey Warner Coleman & Goggin. All Rights Reserved. This article may not be reprinted without the express written permission of our firm. For reprints, contact tamontemuro@mdwcg.com.

In a recently consolidated appeal, the New Jersey Appellate Division clarified the scope of jurisdiction granted to workers’ compensation courts in medical provider claims. The New Jersey Workers’ Compensation Act provides “[e]xclusive jurisdiction” to the courts over disputed medical charges “arising from any claim for compensation for a work-related injury or illness.” Although the jurisdiction inquiry is fact-sensitive, the Appellate Division went further to explain that a single day of treatment in New Jersey was insufficient without any other contacts.

In the first of the two consolidated cases, Anesthesia Assoc. of Morristown, PA v. Weinstein Supply Corp., 2020 WL 5944009 (N.J. Super. App. Div. Oct. 7, 2020), Anesthesia Assoc. of Morristown, PA provided services to an injured worker at a New Jersey hospital on March 22, 2018. The underlying workers’ compensation claim was filed in Pennsylvania because the accident occurred in Pennsylvania, the injured worker was a resident of Pennsylvania, and Weinstein Supply Corp. was based in Pennsylvania. Anesthesia Assoc. submitted a claim to the Pennsylvania Department of Labor and Industry and received a payment per the applicable fee schedule. It subsequently sought payment of the balance from Weinstein’s insurance carrier.

When Weinstein’s insurer failed to make payment on the balance, Anesthesia Assoc. filed a Medical Provider claim in New Jersey. Weinstein filed a motion to dismiss for lack of jurisdiction, which the New Jersey workers’ compensation court ultimately granted. In doing so, the court concluded it did not have personal jurisdiction over the underlying workers’ compensation claim because none of the “Larson factors” (found in Williams v. Port Auth. of N.Y. & N.J., 175 N.J. 82, 87-88 (2003)) applied:

[the employee] lived in [Pennsylvania], worked in [Pennsylvania], and the accident occurred in [Pennsylvania]. The contract of hire occurred in [Pennsylvania]. No contract exists between [Anesthesia Assoc.] and Weinstein. The only connection to New Jersey is that [the employee] underwent one day of medical treatment with [Anesthesia Assoc.] in New Jersey.

The court explained that, just as the courts have found an injured worker’s New Jersey residence alone was insufficient for jurisdiction, “one day of treatment in New Jersey” was also insufficient.

In the second case, Surgicare of Jersey City v. Waldbaums, 2020 WL 5944009 (N.J. Super. App. Div. Oct. 7, 2020), the injured worker, a resident of New York, was injured in New York while working for his New York employer, Stop & Shop. The worker filed a claim in New York and, on August 11, 2017, underwent surgery at Surgicare of Jersey City. Surgicare submitted a claim for payment in New York and subsequently filed a Medical Provider claim in New Jersey. Similar to Weinstein, Waldbaums filed a motion to dismiss for lack of jurisdiction. Surgicare argued that Waldbaums did business in New Jersey and that treatment was rendered in New Jersey, establishing jurisdiction there. However, the New Jersey workers’ compensation court granted Waldbaums’ motion, noting that the injured worker “was directed by his New York doctor to a surgical center in New Jersey for a single, one-day visit. The patient’s same-day surgery was performed by a New York doctor using equipment and devices ordered by the New York doctor.” The judge ruled that this single day of treatment was insufficient to “rise to the standard of sufficient purposeful minimal contacts” for personal jurisdiction.

In reviewing the consolidated appeals, the Appellate Division concluded that “[u]nless the Division [of Workers’ Compensation] has jurisdiction over the underlying claim for a compensable work-related injury, it does not have jurisdiction over a [Medical Provider claim] for payment.” After applying the six “Larson factors” to both cases, the Appellate Division agreed with the workers’ compensation courts in finding that no jurisdiction existed for either claim and held that both were appropriately dismissed.

Finally, feeling compelled to comment on various hyperbolic and inflammatory remarks in the appellants’ briefs, the Appellate Division cautioned against baseless, future attacks accusing the workers’ compensation judges of either abusing their authority or rendering incoherent or preposterous decisions. It was noted that such comments were unwarranted and did little to advance a client’s position, while, on the other hand, eroding the public’s trust in the judiciary.

As these cases illustrate, medical providers seeking reimbursement must establish jurisdiction over the underlying workers’ compensation claim. Although this is a fact-sensitive inquiry, these cases confirm that New Jersey workers’ compensation courts require, at the very least, more than a single day of treatment in New Jersey. The inquiry going forward will be whether two days of treatment or other similar examples will be sufficient bases for jurisdiction. In order to avoid any possibility of paying under the New Jersey payment scheme, where there is no set fee schedule, employers and carriers handling non-New Jersey claims should strive to direct care within their respective states as much as possible. This is not only because whether New Jersey has jurisdiction is fact-sensitive to each case, but also because New Jersey has no fee schedule and only pays the “usual and customary charges” for services.

*Kiara is an associate in our Mount Laurel, New Jersey office. She can be reached at (856) 414-6404 or kkhartwell@mdwcg.com.

Defense Digest, Vol. 27, No. 1, January 2021 is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2021 Marshall Dennehey Warner Coleman & Goggin. All Rights Reserved. This article may not be reprinted without the express written permission of our firm. For reprints, contact tamontemuro@mdwcg.com.

Firm Highlights

Thought Leadership

Pennsylvania Supreme Court to Review Whether Legal Malpractice Claims May Be Recast as Breach of Contract Claims

The Pennsylvania Supreme Court recently granted allowance of appeal to consider whether a plaintiff may pursue a breach of contract claim against an attorney based on allegations that the attorney failed to provide competent legal services. The issue is significant in professional liability litigation because it concerns whether a plaintiff may avoid the statute of limitations applicable to professional negligence claims by characterizing the alleged misconduct as a breach of contract. Antoine Poteat retained attorneys Gary Asteak and Nino V. Tinari to represent him in a criminal matter. After his conviction was subsequently overturned through a Post Conviction Relief Act proceeding, Poteat filed suit against his former attorneys alleging that they breached their retainer agreements by failing to provide competent legal services. The attorneys argued that the claims sounded in professional negligence, rather than breach of contract, and were therefore time-barred. The trial court dismissed Poteat’s complaint, but the Superior Court, sitting en banc, reversed. The Superior Court held that the gist-of-the-action doctrine did not bar Poteat’s breach of contract claim because the alleged failure to provide competent legal services could constitute a breach of the parties’ agreement. The Court further held that a legal-services agreement contains an implied duty requiring an attorney to provide competent legal services, even where the agreement does not contain an express provision requiring such services. The Pennsylvania Supreme Court granted review in July 2026 and will consider whether the Superior Court’s decision conflicts with Pennsylvania precedent distinguishing contract and tort claims, including Bruno v. Erie Insurance Co. The Supreme Court will also address whether a plaintiff may maintain a breach of contract claim based on an implied duty to provide competent legal services without identifying a specific contractual provision that was breached. The Supreme Court’s decision could have significant implications for professional liability litigation in Pennsylvania, particularly where plaintiffs seek to characterize claims arising from alleged professional negligence as contractual claims.

Thought Leadership

The Search-Incident-to-Arrest Doctrine Does Not License Strip Searches

In Beatty v. Gardner, No. 25-2860 (3d Cir. Sept. 16, 2026), Kyle Beatty sued police officers Clinton Gardner and Calvin Irvin under 42 U.S.C. § 1983 after they stopped, arrested, and searched him three times during a drug investigation in Williamsport, Pennsylvania. The officers initially smelled marijuana coming from the car in which Beatty was sitting and observed marijuana residue, giving them probable cause to arrest him. Beatty consented to the first pat-down, and the second search was conducted incident to his lawful arrest; neither search uncovered weapons or contraband. The officers then transported Beatty to the police station solely to strip-search him, but the strip search also revealed nothing. The District Court granted the officers summary judgment, concluding that the initial stop, arrest, and first two searches were reasonable and that qualified immunity protected the officers from liability for the strip search. The Third Circuit affirmed, but held that the strip search itself violated the Fourth Amendment. The court concluded that the search-incident-to-arrest doctrine does not automatically permit officers to strip-search an arrestee outside the jail or prison setting. Because strip searches are highly intrusive and the traditional justifications for searches incident to arrest (officer safety and preservation of evidence) did not justify the search of Beatty, the officers generally needed either the arrestee’s consent, exigent circumstances, or a warrant supported by probable cause to believe that a search beneath the clothing would reveal weapons, contraband, or evidence. Here, the officers had none of those justifications. Nevertheless, the court held that qualified immunity barred damages liability because, at the time of the search, the right against a warrantless strip search of an arrestee outside the institutional setting was not clearly established by Supreme Court or Third Circuit precedent. The court likewise upheld qualified immunity on Beatty’s First Amendment retaliation claim and affirmed summary judgment for the officers.

Thought Leadership

Two Tracks, No Preclusion: Ohio Supreme Court Preserves Separate Damages Claims After Chapter 2506 Appeals

The Supreme Court of Ohio has clarified that an administrative appeal under Ohio Revised Code Chapter 2506 does not bar a separate action for damages and declaratory relief that could not have been pursued in the administrative appeal. The Ohio Supreme Court considered Sheetz, Inc. v. Centerville (2026-Ohio-3531) as a result of a certified question from the Southern District of Ohio. The question was whether Sheetz, the gas station/convenience store brand, was barred from seeking damages in a separate action since damages were not sought in their administrative appeal. Ultimately, the Ohio Supreme Court ruled that res judicata does not bar a separate action for damages after ruling on an administrative appeal because R.C. Chapter 2506 is limited to judicial review and cannot grant affirmative relief. The case arose after Centerville’s city council rejected a site plan proposed by Sheetz, Inc. that had received unanimous approval from the City’s planning commission. Sheetz filed an administrative appeal pursuant to R.C. 2506 in the Montgomery County Court of Common Pleas, and two months later filed a complaint for damages and declaratory relief under 42 USC § 1983 as a takings action with the city, city council, and other objectors as improper takings and a violation of due process, as well as interference with business and contractual relationship. The city and city council removed the § 1983 action for damages to federal court. Montgomery County Court of Common Pleas reversed the city council’s denial, and allowed the Sheetz project to move forward. Upon that ruling, the federal court issued a show-cause order questioning whether the § 1983 action was barred by the doctrine of res judicata via claim preclusion (which includes all theories of recovery).  Sheetz argued that Ohio courts of common pleas do not have authority to award damages or declaratory relief as party of the R.C. Ch. 2506 appeal, therefore res judicata could not be triggered to apply to the § 1983 action. Additionally, Sheetz moved to certify the issue to the Ohio Supreme Court, citing differing results between the second and sixth districts on this same issue. Centerville approached the question, not from a claim preclusion standpoint, but from the holding in Grava v. Parkman, Twp which states that a final judgment rendered on the merits bars all subsequent action based on the same transaction or occurrence.  In yet another approach, an objector argued that claim preclusion was satisfied because Sheetz could have raised its damages claims in the administrative appeal – Sheetz disagrees. In their analysis, the Supreme Court of Ohio broke down the elements of a claim preclusion analysis: 1) a prior final, valid decision on the merits by a court of competent jurisdiction; (2) a second action involving the same parties, or their privies, as the first; (3) a second action raising claims that were or could have been litigated in the first action; and (4) a second action arising out of the transaction or occurrence that was the subject matter of the previous action. The Court held that R.C. Ch. 2506 does not permit a party to argue damages as R.C. Ch. 2506 limits the common pleas jurisdiction as if it were sitting on appeal, and therefore can only affirm, reverse, vacate, or modify the appealed order, or can remand the case to the administrative body. Further, the Court held that Grava’s conclusion that a final judgment precludes additional litigation for different relief is inapplicable under this fact pattern because it was meant only to apply to those matters in which the plaintiff brings the exact same case twice, but for new relief. The Court found Grava was inapplicable because Sheetz could have requested damages or declaratory relief in the R.C. 2506 appeal. Therefore, Grava would be nothing more than dicta if it even did apply. Going further, the Ohio Supreme Court disavowed Sixth Circuit precedent which, in reliance on Grava and other district court decisions, permitted an owner to seeking relief under 42 U.S.C. § 1983 alongside an administrative appeal. See Moore v Hiram Twp., 988 F.3d 353 (6th Cir.2021). The Ohio Supreme Court found that the Sixth Circuit had disregarded a critical decision in Community Concerned Citizens, Inc. v. Union Twp. Bd. of Zoning Appeals, 1993-Ohio-115, which clearly held that a R.C. Ch. 2506 appeal cannot be combined with a complaint seeking other claims for relief. Id. at ¶ 11. To that end, the Ohio Supreme Court has determined that the decisions Moore relied on (outside of Grava) are no longer good law, and that Moore was wrongly decided. The decision draws a clear procedural boundary: Chapter 2506 provides judicial review of an administrative decision, not a forum for independent claims seeking affirmative relief. Although Grava may place claims arising from a single transaction within the potential scope of claim preclusion, those claims are not barred unless the complete claim-preclusion test is satisfied. Because Sheetz could not have pursued damages or declaratory relief in its Chapter 2506 appeal, the separate action was not precluded. The remaining question for practitioners looking to apply or defend against this exception is when does the statute of limitations begin to run on damages and declaratory relief claims related to an administrative decision on appeal? A takings action in federal court has a 2-year statute of limitations, or as a state claim, 4 years (like the other tortious claims raised therein). Correlating this case with others, an administrative appeal will not likely toll the statute of limitations on claims based on a final decision by a municipal authority. Therefore, practitioners should look for these cases to be brought simultaneously.