The Virginia Court of Appeals issued two significant workers' compensation decisions in May 2025 that will impact how practitioners handle disability ratings and third-party settlement procedures. These cases provide crucial guidance on medical evidence standards and statutory interpretation under Virginia workers' compensation law.
Kpakio v. Sentara Healthcare: Limiting Disability Awards to Directly Injured Body Parts
Case Overview and Workers' Compensation Implications
In Tommy F. Kpakio v. Sentara Healthcare (Record No. 2042-23-4, decided May 20, 2025), the Virginia Court of Appeals addressed a fundamental question in workers' compensation practice: when workplace injuries to specific body parts cause functional limitations in other areas, how should permanent partial disability awards be calculated?
Key Facts of the Virginia Workers' Compensation Case
Tommy Kpakio, an HVAC mechanic, suffered partial amputations of his right middle and ring fingers in a workplace accident on August 26, 2020. Despite the injury being limited to his fingers, Kpakio experienced:
- Phantom pain radiating to his hand and arm
- Significant loss of grip strength
- Inability to make a closed fist
- Reduced capacity to use hand tools effectively
Competing Medical Opinions in Workers' Compensation Evaluation
The case featured conflicting medical evaluations that highlight important considerations for Virginia workers' compensation practitioners:
Dr. Richard Meyer's Assessment:
- Used Fourth Edition AMA Guides to Evaluation of Permanent Impairment
- Rated 30% middle finger impairment and 70% ring finger impairment
- Converted to 14% hand rating and 13% upper extremity rating
- Final assessment: 38% permanent partial disability rating
Dr. David Miller's Assessment:
- Used Sixth Edition AMA Guides (current standard)
- Rated 10% middle finger impairment and 45% ring finger impairment
- Converted to 7% hand impairment and 6% upper extremity rating
- Explained rationale for using current edition guidelines
Virginia Workers' Compensation Commission Decision
The Workers' Compensation Commission ultimately limited the permanent partial disability award to the injured fingers specifically, awarding:
- 15% loss of use of right long finger
- 50% loss of use of right ring finger
The Commission gave greater weight to Dr. Miller's opinion based on his use of current AMA Guides and objective measurements.
Court of Appeals Ruling on Workers' Compensation Disability Ratings
The Virginia Court of Appeals affirmed the Commission's decision, establishing important precedent for workers' compensation disability evaluations:
- Credible evidence supported limiting awards to directly injured body parts
- Medical records showed no documented hand injury
- Worker's return to full-duty employment without restrictions was significant
- Current AMA Guides editions carry more weight than outdated versions
Goode v. VCU: Third-Party Settlement Procedures Under Code § 65.2-313
Virginia Workers' Compensation Third-Party Recovery Framework
In Fawn Goode v. Virginia Commonwealth University (Record No. 0290-24-2, decided May 13, 2025), the Court of Appeals clarified critical procedures for handling workers' compensation benefits when employees obtain third-party tort settlements exceeding employer liens.
Case Facts and Third-Party Settlement Details
Fawn Goode sustained compensable workplace injuries on May 21, 2019, resulting in:
- Weekly temporary total disability benefits of $767.94
- Lifetime medical benefits coverage
- Third-party tort settlement of $500,000 in 2023
- VCU's workers' compensation lien of $268,880.20
Code § 65.2-313 Requirements for Virginia Workers' Compensation
When third-party recoveries exceed employer liens, Virginia Code § 65.2-313 establishes specific procedures:
- Employer receives offset against future benefit liabilities
- Employer must reimburse employee's litigation costs proportionally
- Payments continue until offset amount is exhausted
- Benefits resume once third-party recovery is depleted
Workers' Compensation Commission's Third-Party Order
After multiple revisions, the Commission issued a final third-party order that:
- Suspended (not terminated) Goode's initial award order
- Granted VCU an offset of $268,880.20 against future liabilities
- Required VCU to pay 41.58% of each submitted entitlement
- Established reimbursement continuation until offset exhaustion
Virginia Court of Appeals Analysis of Workers' Compensation Law
The Court of Appeals affirmed the Commission's approach, holding that Code § 65.2-313's plain language requires:
Benefit Suspension During Offset Periods: Unlike ongoing disability awards with automatic payments, the statute creates a submission-based reimbursement system.
Prevention of Double Recovery: The statutory scheme ensures employees cannot receive both third-party settlement proceeds and full workers' compensation benefits simultaneously.
Temporary Nature of Suspension: Benefits will resume automatically once the third-party recovery is exhausted through medical and disability expenses.
Key Takeaways for Virginia Workers' Compensation Practitioners
Medical Evidence Best Practices
- Use Current AMA Guides: Ensure medical evaluators use the most recent edition of evaluation standards
- Document Methodology: Require detailed explanations for rating approaches and guide selection
- Focus on Direct Injuries: Limit disability ratings to specifically injured body parts, even when functional impacts extend beyond injury sites
- Maintain Comprehensive Records: Thorough medical documentation remains crucial for Commission credibility determinations
Third-Party Settlement Procedures
- Expect Benefit Suspension: Code § 65.2-313 requires suspension of ongoing awards during offset periods
- Understand Reimbursement Structure: Employers pay proportional litigation costs as entitlements are submitted
- Plan for Benefit Resumption: Awards automatically resume once third-party proceeds are exhausted
- Distinguish Suspension from Termination: Suspended benefits maintain future enforceability
Appeals Strategy Considerations
Both decisions reinforce the Virginia Court of Appeals' continued deference to Workers' Compensation Commission factual findings when supported by credible evidence. Successful appeals must focus on clear legal errors rather than factual re-litigation.
Impact on Virginia Workers' Compensation Practice
These May 2025 decisions provide essential guidance for Virginia workers' compensation attorneys, insurance carriers, and medical evaluators. The Kpakio case emphasizes precision in disability rating methodology, while Goode clarifies complex third-party settlement procedures that frequently arise in significant injury cases.
For Workers' Compensation Claimants: Understanding these precedents helps set realistic expectations about disability ratings and third-party settlement impacts on ongoing benefits.
For Employers and Carriers: The decisions provide clear frameworks for medical evidence evaluation and third-party recovery procedures, reducing litigation uncertainty.
For Medical Evaluators: The emphasis on current AMA Guides and documented methodology underscores the importance of thorough, well-reasoned assessments in workers' compensation cases.
Keywords: Virginia workers compensation, disability ratings, third-party settlements, AMA Guides, permanent partial disability, Court of Appeals, Code 65.2-313, workers comp benefits, medical evidence, Virginia Workers Compensation Commission
For more Virginia workers' compensation legal updates and case analysis, consult with experienced workers' compensation attorneys familiar with current Court of Appeals precedents.