Tag Archives: illegal aliens

5 Complex Issues Facing Regulators

The 2014 International Association of Industrial Accident Boards and Commissioners (IAIABC) Annual Conference in Austin offered a forum for regulators from around the country to discuss common issues and potential solutions. At this year’s conference, held Sept. 29  to Oct. 2, regulators highlighted a variety of complex issues that they are currently facing. Top issues include:

1. Hospital-Fee Schedules

In states that do not have hospital-fee schedules, the standard for payment is usually “reasonable and customary” charges. The question becomes, how do you determine what is reasonable? Healthcare providers push for billed charges to be the standard, but payers feel that this is an unfair standard because the charges are significantly higher than what providers ultimately accept as payment. Payers are pushing for paid charges to be the standard, but providers argue that preferred provider organization (PPO) contracts heavily influence average charges and that those contracts are based on volume. Providers do not believe that those without contracts should get the benefit of that volume discount.

2. Benefits for Illegal Aliens

Nearly all states extend benefits in some form to illegal alien workers. In some states, benefits are limited to medical benefits, while other states limit benefits to medical and total disability. In most states, there are no limitations to what benefits these workers can receive.

The concern is that some states are awarding these injured workers permanent total disability benefits because their status as illegal aliens means they cannot be put through vocational rehabilitation and returned to work. Attorneys argue that total disability benefits should continue when a light-duty release is obtained because that person cannot legally return to work. States are trying to find a balance that protects the illegal alien workers but doesn’t award them additional benefits simply because of their inability to legally work in the U.S.

3. Ride-Sharing Services

The explosion of ride-sharing services such as Uber is causing concern with regulators around the nation. The big concern from a workers’ compensation standpoint is whether these drivers should be classified as employees of Uber or whether they are independent contractors. Owners of taxi companies argue that allowing these drivers to be classified as independent contractors creates an unfair competitive advantage. States are challenged with whether they can classify these drivers by statute or whether this should be done by courts interpreting current statutes.

4. Treatment Guidelines

Several states, including Washington, Texas and Colorado, have pushed out treatment guidelines for issues such as opioids and lower back injuries. These guidelines have resulted in significantly lower medical costs on claims. The medical community tends to resist implementation of such guidelines as they feel this impedes their ability to render appropriate medical care based on the specifics of the patient. Those that argue for treatment guidelines point to significant research on the effectiveness of certain treatment methods and the dangers associated with opioids above certain dosage levels.

5. Large-Deductible Policies

Regulators feel that there is confusion on the differences between large-deductible policies and self-insurance, with many employers assuming that the two are interchangeable. In some states, courts have ruled that employers under a large-deductible policy cannot have influence over the claims-handling process, so they cannot access items like adjuster files.

The carrier is ultimately responsible for payment of the claims and compliance with the statutes. If the carrier is unable to collect the deductible from the employer, the regulators do not have jurisdiction over the issue. The deductible agreement is outside the parameters of the insurance policy.

Immigration Reform On The Horizon: What It Means For Medical Tourism And Workers' Compensation

Five years ago, members of a risk management discussion group I belong to on Yahoo Groups raised the question of whether or not illegal immigrants (i.e., undocumented immigrants) were entitled to workers’ compensation benefits. The answer most of the respondents gave was yes, but with some restrictions depending upon the state. One respondent in particular even provided the group with documents from the Independent Insurance Agents & Brokers of America, Inc. (IIABA) that gave the pros and cons in the debate on whether undocumented immigrants were entitled to benefits or not.

The purpose of this article is not to rehash the debate points, but to explore what impact impending immigration reform, which has been promised by the Obama administration in the upcoming second term of the president, will have on workers’ compensation and the likelihood that injured newly legal immigrant workers, especially from Mexico and other Latin American countries, will avail themselves of the benefits of medical tourism to their home countries as an option if injured on the job.

According to the IIABA White Paper, which cited a Pew Hispanic Center report published in 2006, there are probably 11 to 12 million undocumented immigrants in the US, depending upon how many have “self-deported” recently due to the current US economic slowdown. Demographically, this represents 5.4 million men, 3.9 million women, and 1.8 million children. In addition, there are 3.1 million children who are US citizens, having been born here (64% of all children of the undocumented) from one or more parent.

President Obama’s Executive Order last year gave many of these children a reprieve from deportation while they are attending college here and until more comprehensive reform can be achieved for all undocumented immigrants. Undocumented immigrants account for almost one-third of all foreign-born residents of the US, and about 80% of these are from Mexico and other Latin American countries.

The report also states that out of the total number of 9.3 million undocumented adults, 7.2 million (77%) are employed and account for around 5% of the US workforce. They comprise a disproportionate percentage in some industries, such as 24% of farm workers, 17% of cleaning workers, 14% of construction workers, and 12% of food preparers.

These industries typically account for much of the claims filed under the US workers’ compensation system. Within a particular industry, undocumented workers comprise a higher percentage of more hazardous occupations. For example, 36% of insulation workers and 29% of all roofing employees are estimated to be undocumented.

In my blog post, The Stars Aligned, I briefly touched upon the issue of immigration reform’s impact on medical tourism for workers’ compensation in regard to Mexican workers in the US. But since President Obama and Florida Senator Marco Rubio have recently outlined different reform plans, which I will discuss here in this post, it is important to mention first how undocumented workers are treated under the various laws each state has established to govern their workers’ compensation systems.

A document I mentioned in that blog post was a chart of the laws governing workers’ compensation and undocumented workers that one of the respondents had forwarded to the discussion group.

Undocumented workers are entitled to workers’ compensation benefits in thirty-eight states; however, six states have statutes that allow or restrict benefits for various reasons such as:

  • if the employment was obtained under false pretenses (Florida);
  • if disability benefits were payable or they were unable to work because of the injury (Georgia);
  • if they were entitled to medical, but not disability benefits because of a commission of a crime under the Immigration Reform and Control Act (IRCA) of 1986 signed by Ronald Reagan (Michigan);
  • if vocational rehabilitation benefits were covered since the worker could get employment outside the US (Nevada);
  • if disability payments were recoverable at US wages rather than those of the home country or if the employer was aware or should have been aware of the undocumented status (New Hampshire); or,
  • if disability benefits were not payable if the worker was unable to work due to his status and not the injury (North Carolina).

Three states — California, Georgia and Nebraska — have statutes that indicate that undocumented workers are not entitled to benefits in certain situations. California case law establishes that undocumented workers could be refused vocational rehabilitation benefits. Georgia case law establishes that disability benefits are not payable if the worker is unable to work due to his status and not his injury. And, Nebraska case law established that a worker named Ortiz could be refused vocational rehabilitation benefits because he could not legally work in the US and did not plan to return to Mexico to work.

Only Wyoming has a statute that expressly includes only “legally employed … aliens.” And case law in 1999 confirmed that undocumented workers were not entitled to benefits. Eleven states — Alaska, Delaware, Indiana, Maine, Missouri, Rhode Island, South Dakota, Vermont, Washington, West Virginia and Wisconsin — were listed in the chart as unknown as to whether or not undocumented immigrants are entitled to benefits.

As we begin the second Obama Administration, immigration reform has risen to the top of the list, only to be preceded by the debt crisis and the fiscal cliff. As I mentioned above, both President Obama and Florida Senator Marco Rubio have outlined their own versions of what immigration reform would look like. Senator Rubio’s plan would rely more on skilled workers such as engineers and seasonal farm workers while tightening border enforcement and immigration law. Senator Rubio’s plan would not provide blanket amnesty to those already here.

On the other hand, President Obama’s plan, as outlined in a recent New York Times article, would seek to give undocumented workers a path to citizenship. Sen. Rubio’s plan would focus more on merit and skill as prerequisites for entry into the US, much like earlier immigration laws passed in the 1920s and other decades. The president’s plan would be broader and more immediate, and would probably have less of an impact on the economic stability of those industries that currently rely on undocumented workers.

Whatever form immigration reform will take, the opportunities to offer medical tourism as an option to injured undocumented workers, once they achieve some legal form of citizenship, will no doubt increase. The likelihood that something will be done this year has already been the topic of many news programs and even has been discussed by congressional leaders such as Harry Reid, the Senate Majority leader.

Once the currently undocumented can legally remain in the US and continue to work in the industries they occupy, it is more likely that they will opt to go to their home country for medical treatment should they get injured on the job. With the benefits of doing so, such as not having language barriers, cultural barriers, and being able to be visited by friends and family living there, they will be more open to receiving treatment at facilities they normally could never get into. And as many of these countries are fast becoming “rising stars” as medical tourism destinations, the more likely they will want to get treated at the best hospitals in their countries, which will have a huge impact on their recovery, their well-being and their standing with friends and family. And the financial burden of not having to look for a job back home and being able to return to the US will convince them to opt for medical tourism as injured workers.