Tag Archives: social security disability

20 Work Comp Issues to Watch in 2016

In an “Out Front Ideas with Kimberly and Mark” webinar broadcast on Jan. 12, 2016, we discussed our thoughts around the issues that the workers’ compensation industry should have on its radar for 2016. What follows is a summary of 20 issues that we expect to affect our industry this year.

  1. Election Cycle

Everyone knows that this is a presidential election year. But election time also means governor and insurance commissioner seats are available. State insurance commissioners are elected in 11 states and appointed in the other 39. In the coming election, there are 12 gubernatorial seats and five insurance commissioner positions to be decided. The workers’ compensation industry needs to be paying attention to these elections because the insurance commissioners can have significant influence over procedures, policies and enforcement in their states.

  1. Viability of Workers’ Compensation

It is important for all of us to consider the continuing viability of workers’ compensation. Is the grand bargain still doing what it was established to do? There is a growing debate around the gaps and shortcomings of workers’ compensation. Our industry needs to engage in a critical analysis of these issues.

  1. Federalization

In October 2015, 10 high-ranking Democrats on key Senate and House committees sent a letter to the Department of Labor asking it to conduct a critical review of state workers’ compensation systems. Some are concerned that this is a sign we could see federal government involvement in state workers’ compensation systems.

In some ways, the federal government is already involved in workers’ compensation. For instance, OSHA has a tremendous impact on workers’ compensation. Medicare Secondary Payer Compliance is another example of federal law affecting the system.

Recent criticisms of workers’ compensation have focused on the vast benefit differences between states. There is also growing concern that workers who are permanently disabled are pushed off workers’ compensation and onto Social Security disability. With Social Security raising solvency concern, lawmakers will be receptive to discussions on how to keep workers’ compensation from shifting long-term claims to the federal government.

This is a substantial issue to watch in the coming years, and there is a significant chance that the federal government will suggest minimum benefit recommendations to the states at some point. This could especially affect states that have hard caps on the total amount of indemnity benefits that an injured worker can receive.

  1. Affordable Care Act

The Affordable Care Act (ACA) will continue to be a subject of discussion in 2016.

The implementation date of the high-cost, employer-sponsored health plans tax, dubbed the “Cadillac tax,” was recently delayed from 2018 to 2020. It imposes an excise tax of 40% on health plans whose value is more than $10,200 for individual coverage and $27,500 for a family. Regardless of the delay, employer-sponsored benefit plans have evolved over the past five years in preparation to avoid the additional tax. The formerly rich benefit plans were dropped in an effort to provide benefit plans within ACA’s requirements and often replaced by higher-deducible plans with reduced benefits.

NCCI and WCRI have both conducted studies on how the ACA has affected workers’ compensation. Results have not conclusively tied treatment delays or actual cost shifting to workers’ compensation. We believe continuing studies by these organizations and others are important to evaluate the impact of ACA on workers’ compensation.

Other issues that should be monitored include consolidation of health systems, providers and insurers. In 2015, there was more than $700 billion of consolidation in the healthcare marketplace. This is driven, in part, by the ACA, because scale and size assist providers with efficiency, purchasing power and the need to provide a continuum of care.

Another issue where the ACA could affect workers’ compensation is changing reimbursement models. Medicare is looking to shift into a value-based reimbursement model, and many state fee schedules are based on Medicare rates.

Although not specifically related to ACA, a healthcare topic to keep an eye on is drug pricing. Drug pricing will continue to be a topic within the media, PBMs, employer benefit managers, health plan experts and the political arena. Prescription drug pricing increased more than 10% in 2015, and this trend is expected to continue. This has an impact on the cost of workers’ compensation claims.

  1. Holes in Workers’ Compensation

What many people do not realize is that workers’ compensation protections are not available to all workers within the U.S. In 14 states, smaller employers with five employees or fewer do not have to secure coverage. In 17 states, there is no legal requirement for coverage of agricultural workers. Half of the states do not require coverage for domestic workers, and five states specifically exclude coverage for these employees. There are also states that create exceptions for certain types of workers, such as state employees in Alabama. Finally, we have seen from court cases around the country that occupational diseases that take several years to develop are often barred by the statute of limitations, leaving workers with no recourse for benefits.

These holes are yet one more thing that critics point to when talking about the inadequacy of workers’ compensation. The occupational disease issue is particularly concerning because it is very easy to question the fairness of barring a claim under the statute of limitations and, at the same time, denying the injured worker the ability to pursue a claim in civil court under the exclusive remedy protections of workers’ compensation. This is another area where we will not be surprised to see the federal government give recommendations.

  1. Blurred Lines Between Workers’ Compensation and Group Health

The employee health model is evolving. Employers are finding the need to provide a consistent healthcare experience for their workforce and plan members. Employers would like to find a model that provides both quality care and consistency for their employees, regardless of whether the need for treatment arises from a work injury or at home. Because a healthy workforce is a productive workforce, employers also feel that there is a need to tie health and productivity together.

We will continue to see health systems build accountable care organizations (ACO) and enter the health plan, insurance and risk-bearing arena with the goal of directly selling to and partnering with employers. ACOs are an attractive model for employers supporting a healthier workforce by extending the culture of health philosophy from work to the home for their employees and their families.

Mental health is a top driver for absence across employers and not simply a health cost concern. Mental healthcare should be as important as physical healthcare and is currently a focus of population health and employer programs. Employers are looking for healthcare models, which consider the person as a whole and offer consistent, engaging behavioral health and wellbeing programs for the workforce.

Workers’ compensation key stakeholders should be a part of the evolving health model discussions and early stage planning so as not to be left in the dark as health models change.

  1. Options to Workers’ Compensation

We all know that Texas has a unique system that allows employers to completely opt out of workers’ compensation benefits. The term “opt-out” refers only to the Texas system. Employers in Oklahoma have an option to workers’ compensation that allows them to develop a private benefit plan that replaces state-mandated workers’ compensation. It is this concept of an option that is looking to spread to other states. Bills on this issue will be reintroduced in Tennessee and South Carolina this year, and other states have begun preliminary discussions.

Some employers feel that they can provide better benefits to their injured workers at a lower cost with these option programs. Others are concerned that these programs lack the controls and oversight of state workers’ compensation. One thing is certain: This issue is not going away any time soon. Perhaps these discussions around options to workers’ compensation can lead to discussions about workers’ compensation reform, including employer medical control, increasing thresholds of compensability and reducing the bureaucracy of the workers’ comp system.

  1. Evolving Claims Model

There are significant discussions around the evolving claims model. The industry realizes that we need to focus more on the injured worker as a consumer. The model needs to focus more on advocacy, but what does this really mean? Should there be a person who assists the injured worker in understanding the claims process, or is there a need to change the culture of our industry to be less adversarial?

Other parts of the evolving model involve who actually touches the claim. Are there elements that could be automated? Should there be more specialization with different individuals performing different tasks instead of the current model where the claims adjuster is a generalist performing multiple tasks across multiple jurisdictions?

The claim handling model also needs to adapt to new technology and the way in which different generations want communication. Some injured workers prefer text instead of e-mail or phone calls. Some like to access claims information in an app on their mobile device or simply, 24/7, as they want it that moment. The model must evolve to take full advantage of new technology and communication methods.

The March 15 “Out Front Ideas with Kimberly and Mark” webinar will focus on the evolving claims model and include guests who are passionate about an advocacy-based design.

  1. Florida Supreme Court

Over the last two years, four cases challenging the constitutionality of various aspects of the Florida workers’ compensation statutes have made it to the state’s Supreme Court. The first of those cases, Padgett, ended in late December when the Supreme Court declined to review it. That case had been thrown out on procedural grounds during the appeal process, so the Court of Appeals and Supreme Court never addressed the underlying constitutional challenge.

There are three cases still to be decided:

  • Westphal, which deals with caps on temporary disability benefits.
  • Castellanos, which addresses limitations on attorney fees.
  • Stahl, which focuses on post MMI medical co-payments and the elimination of permanent partial disability payments.

The expectation is that the Florida Supreme Court will address all of these cases in 2016, but nobody knows when that will occur.

  1. Bureaucracy

Workers’ compensation is one of the most highly regulated lines of insurance, and regulators are increasingly aggressive in pursuing fines and penalties. Every form filed and every payment transaction is an opportunity for a penalty. EDI allows regulators to automate the fines and penalties. Some states perform retrospective audits on activity five to 10 years in the past. The IMR process in California adds administrative cost to claims without necessarily improving outcomes, and states with self-imposed penalties may be driving up the cost of doing business beyond the benefit of the penalty payment. Lobbying is becoming an increasingly important area for payers and service providers to consider.

The significant costs associated with the bureaucracy of workers’ compensation regulations are not improving the outcomes on claims. Most of the money collected from the fines and penalties is paid to the states. The programs may cover the operating costs of state workers’ compensation division and not be paid to the injured worker or medical provider.

This topic is an important issue to watch in 2016 and will be the topic of our Feb. 9 “Out Front Ideas with Kimberly and Mark” webinar.

  1. Regulatory Change

There are four states in particular that we should be keeping an eye on in terms of potential regulatory reforms in 2016:

New York

Employers in New York are continuing to push for additional workers’ compensation reforms to reduce their costs because the savings projected with the last round of reforms never fully materialized. Whether there is enough momentum to get a bill through this year remains to be seen, but the efforts are there.


In Florida, the situation is going to depend on what the state Supreme Court does with the cases mentioned earlier. If any of those cases punch holes in the constitutionality of the workers’ compensation law, then the legislature is going to need to address this. Again, this is a waiting game.


Illinois Gov. Rauner has made it a priority to enact workers’ compensation reforms to reduce employer costs. But his efforts have been blocked by the state legislature, and there is a budget stalemate in the state. There has been much political back-and-forth on this budget and the workers’ compensation reforms. It remains to be seen if the governor has the political muscle to get his legislation passed.


Ever since the Schwarzenegger workers’ compensation reforms in 2004, and continuing with SB 863 passed by Gov. Brown, the California legislature has been trying to undermine these workers’ compensation reforms. Every year, multiple bills are passed by the legislature, and every year both Gov. Schwarzenegger and Gov. Brown have vetoed those bills. Gov. Brown is committed to preserving his workers’ compensation reforms, and there are three years left on his term. Once he is gone, there is concern about what could happen with workers’ compensation in California. But, for now, significant change is not expected.

  1. Talent Acquisition

Talent acquisition and retention is probably the biggest issue facing the entire insurance industry. Consider:

  • 25% of insurance industry workforce will retire by 2018 (McKinsey)
  • There are 2.3 million workers in the insurance industry. More than 1 million will retire in the next 10 years, and 400,000 positions will be left open by 2020 (Deloitte and Jackson Group)
  • Workers over the age of 45 represent 48% of the insurance workforce

Are we doing enough with colleges to show the career opportunities in the insurance industry? Although more colleges and universities are offering risk management programs, the reality is that there are very few of these programs nationwide. Our industry needs to support these programs with both grants and internship opportunities.

In workers’ compensation, we need to be looking at the role of the examiner. Are there tasks that we could automate and reduce workload need? Millennials say they want to work with purpose. The role of the claims adjuster is to assist injured workers in their recovery. Could we be doing more to highlight the positive aspects of the claims adjuster role to make it more attractive to millennials?

We also need to be looking at ways to be flexible with work schedules and at whether someone is tied to the home office or able to work from a remote location. Finally, we need to continue to focus on promoting diversity and inclusion within our workforce.

In May, we will be doing an “Out Front Ideas with Kimberly and Mark” webinar devoted to this topic.

  1. Market Conditions

You cannot forecast the coming year for the workers’ compensation industry without talking about rates. Recently, for the first time in years, the Fed increased interest rates. This is good news, but the change is still insignificant and will not have a material impact on the workers’ comp industry. Because investment opportunities are limited for carriers, they continue to be very diligent with their underwriting. What does this mean for rates? Right now, the market is relatively stable. Accounts with good loss histories could see steady to slightly decreased rates, while accounts with poor loss histories will likely see slight increases. Overall, significant rate changes across the nation are not expected in the coming year.

  1. Predictive Analytics

Predictive analytics have been a buzz word in our industry for a number of years. Most data models identify at-risk claims, which may benefit from additional intervention in terms of nurse case management or a more skilled adjuster. The goal of the intervention(s) is to change the trajectory of the claim, to do something different than in similar prior claims, so the result is improved over the past experience. Although most payers reflect having predictive analytics and a variety of models available, there are limited published results on the outcome and effectiveness. Watch in 2016 to see if organizations begin sharing outcomes as a way to market their business or provide industry thought leadership on what is working and should be considered to drive success.

There is a need to evolve predictive analytics and big data models so that some human tasks are automated. Instead of just identifying cases where intervention is necessary, we should also identify claims where minimal intervention is needed. This approach frees resources and allows attention on claims, which will benefit from the touch. Future claims models will benefit from analytics using learning models similar to IBM Watson-type smart analytics.

  1. OSHA

OSHA continues to be a challenge for employers. Going into 2016, OSHA has increased reporting and recordkeeping requirements. It is also increasing its focus on certain industries, including healthcare, and employers are seeing a significant increase in fines. This is an area that is constantly evolving.

Our April 5 “Out Front Ideas with Kimberly and Mark” webinar will focus on these continuing developments and discuss the continuing issues that employers should track.

  1. Utilization Review

There is industry buzz and sidebar conversations around utilization review (UR) and the current approach deployed by employers, payers and service providers. Physicians are asking more than ever how they can help streamline treatment requests, obtain decision outcomes electronically and more quickly and provide timely, appropriate care for patients.

Utilization review should ensure that injured workers receive appropriate care within the right setting and for the correct duration. But what is the right UR model? Should all treatment be subject to UR or select treatment requests? Is UR a process strictly addressing the request for treatment and medical documentation submitted against guidelines of care or collaborative with adjusters, providers and the injured workers? Are denials of care driving up litigation unnecessarily? Do utilization review referral triggers change if the physician providing care is part of a high-performance network or known to be a top-performing physician? These are questions being raised by industry veterans and newcomers alike and are likely worthy of a review and further dialogue.

In the consumer-driven health world where we find ourselves, there is greater interest from injured workers to understand treatment options and outcomes. If not a part of UR, is your case management or claim model providing medical treatment option education, inclusive of outcomes awareness? Transparency is becoming increasingly important to consumers.

  1. Exclusive Remedy

Plaintiff attorneys are always trying to find ways around the exclusive remedy protections of workers’ compensation, and these efforts are becoming increasingly successful. In early January 2016, the District Court of Appeals in California allowed an injured worker to pursue a civil claim against a utilization review provider because the provider failed to warn him about the potential risks of medication withdrawal.

More and more, judges are allowing such litigation to survive a motion to dismiss on summary judgement because of workers’ compensation exclusive remedy protections. This creates enormous costs for employers and carriers, which then must spend hundreds of thousands of dollars or more defending such lawsuits and face the risk of a jury award that could be worth millions. In addition, an employer’s liability award based on the “intentional actions” of the employer may have issues with insurance coverage. The entire industry should be paying close attention to this area of increased litigation around exclusive remedy.

  1. ICD-10

The ICD-10 medical classification came along last year with a lot of hype and a significant amount of work effort to update systems and train teams. There was concern that the new diagnosis codes would result in slowed claims processes and treatment decisions. Thus far, workers’ compensation key stakeholders report little to no impact from the change. This may be because states did not mandate the use of ICD-10 for workers’ compensation and most organizations continue to accept ICD-9. Bill review receipt to pay timeframes have not lengthened, and e-billing rejections did not increase, which were two areas to watch after the ICD-10 go-live.

In 2019, Medicare plans to roll out an incentive-based reimbursement model tied to patient outcomes (MACRA). The American Medical Association believes this will be a significant reimbursement change for physicians. Changes to Medicare reimbursement could impact workers’ compensation because some state fee schedules are Medicare based.

History has proven Medicare does not always follow through with what it says it is going to do in terms of changing reimbursement models, but the MACRA implementation is an issue worth monitoring.

  1. Marijuana

Thus far, New Mexico has been the only state allowing medical marijuana for treatment under workers’ compensation. But as the use of medical marijuana spreads, it is inevitable that we will see other states take on this issue. The answer is simple –if states put something in their statutes barring medical marijuana under workers’ compensation, then that solves the problems. Some medical marijuana states have already indicated that insurance is not responsible covering medical marijuana. State legislators and regulators can stop this before it becomes a legitimate problem.

The bigger issue is employment practice concerns. Many expect the federal government to reclassify marijuana as a Schedule 2 drug, possibly by the end of this current administration. Once that happens, it will no longer be an “illegal” drug. Employers are going to need to adapt and drug test for impairment rather than just testing the presence of the drug. Standards are going to need to be developed on what constitutes “impairment” with marijuana. The science needs to catch up with the realities of this new normal when it comes to marijuana in the U.S.

  1. On-Demand Economy

The on demand economy is creating new concerns about what constitutes an employee/employer relationship. Is an Uber driver an employee of Uber or an independent contractor? What about a repair person you hire through Angie’s List?

While the on-demand economy is a newer dynamic, determining what constitutes independent contractor vs. an employee has been a challenge for the workers’ compensation industry for many years. In July 2015, the Department of Labor issued an interpretive memorandum indicating that the DOL feels “most workers classified as independent contractors are employees under the Fair Labor Standards Act’s broad definitions.”

So perhaps the issue to watch here is not so much the on-demand economy, but instead whether we are going to see the Department of Labor push for fewer and fewer workers to be classified as independent contractors. This could have a significant impact on many industries as well as significantly changing the business model of services like Uber and Lyft.

Looming Collapse of SSDI–What It Means

An extremely well written article from David Langham graces our Blogwire pages today. In it he recounts for us the looming financial collapse of the Social Security Disability Income program, or SSDI. Langham is the Deputy Chief Judge of Compensation Claims for the Florida Office of Judges of Compensation Claims and Division of Administrative Hearings. Within this jurist’s missive he provides one of the best breakdowns that I have ever read concerning the financial issues that program faces.

Bottom line? SSDI now supports over 11,000,000 people, and is projected to be broke within two years. Each and every full time worker in this country needs to cough up $750 a year just to maintain this entitlement program at its current levels (and it has grown 73% since 2000, so good luck with that).

Langham goes into excellent detail as to the causes of this unprecedented growth. There are a good number of contributing factors, including population growth, aging population, more working women eligible for the program, and expanded qualifications for disability. However, there is one postulation he did not make. That is the possibility that intentionally overworked Social Security Disability Administrative Law Judges find it much easier to approve cases than to deny them. I once heard of one judge indicating as much, saying that when he approves an application, it simply takes his signature. When he denies one, it requires many written pages of justification.

Approval in the face of an overwhelming workload, it would seem, is the path of least resistance.

One other very interesting tidbit that Langham provides: at one point during the economic downturn, an estimated 117,000 Americans “double dipped”, drawing simultaneous payments from both unemployment and SSDI. With one program dedicated to assisting people who cannot find work, and the other designed to support those who cannot work, how can that possibly be?

So we find ourselves with another bloated and overwhelmed government program screaming towards financial crisis, and a generally oblivious public will soon awaken (once again) to the fact that there is no such thing as a “lock box” or “government trust fund”. The money is gone. We’ve spent it all on underwear for the illegals streaming across our southern border.

Not to fear, however, for I have a solution for this mess. SSDI should hold a fundraising bake sale.

The pivotal bake sale has for decades been the go to solution for those programs in need of a cash infusion. Schools and churches have used them. Rush Limbaugh once famously orchestrated one in the 1990’s for a listener named Dan who couldn’t afford his subscription newsletter. Limbaugh told him to hold a bake sale, and over 100,000 people ultimately flooded downtown Fort Collins, CO the day of “Dan’s Bake Sale”. I believe some misguided people have even used them in some perverted “guns for cookies” exchange program. That endeavor failed miserably when they were robbed at gunpoint and someone stole their cookies. Seems they should have also traded for some ammo.

So why not an SSDI bake sale? Think of the pure numbers. There are 11,000,000 people in the program, presumably with a great deal of free time on their hands. If they all fire up their ovens and contribute to the effort, we’re talking one crapload of cookies and other baked goods available for sale. Granted, there are people receiving SSDI that are completely disabled, and would not be able to contribute to the effort, but many would still be able to do so.

There was the woman who once blasted me in my blog for using the word “entitlement”. She told me how difficult it was for her to get SSDI, and explained how she was entitled to it – without using the word entitled, of course. Her blog and Facebook page told us she was an active real estate agent, and owned a tax preparation service as well as a legal documents preparation firm. She could probably cough up some cookies, if she can get enough time away from her day jobs and cashing her disability checks. And of course, we have the 117,000 people who collected unemployment while on disability. We can safely presume if they are able to work, they are able to bake. And since they are on unemployment, they have the time.

So for sake of conjecture, let’s say that one half of the people on SSDI would have the ability for a short duration to make cookies or baked goods for one mammoth SSDI “Going Out of Business” Bake Sale. That means with 5.5 million people, baking, say 6 dozen cookies each, and selling them for $5 a dozen (this is a fundraiser, after all), we could raise $165,000,000 in a single afternoon, less location and promotion expenses.

As far as location, I figure we could use Tropicana Field in St. Petersburg, Florida, where the Tampa Bay Ray’s baseball team plays. There is ample parking, and the seats are almost always empty. Plenty of room for a ginormous bake sale.

Now, with the current SSDI burn rate of $12.4 billion a month, or $413,333,333.33 a day, the bake sale would only raise enough to fund the program for an additional 9 ½ hours.

But hey, it’s a start, and I haven’t even yet broached my idea of the SSDI “Going Out of Business Car Wash”.

Why Workers’ Comp Claims Will Keep Falling

According to NCCI, the number of lost-times claims has been on a downward trend for more than a decade. With the exception of 2010, the number of lost-time claims has been declining over the past decade at a predictable rate of approximately 2% to 3% a year. The question, though, is whether this trend will continue.

Many analysts are predicting a rise in the number and frequency of lost-time workers’ compensation claims. This certainly may be true for 2014 as the U.S. is finally emerging from one of the longest recessions in history, coupled with the resurgence of the domestic oil and natural gas industry. However, this upward blip will have little, if any, effect on the long-term downward trend. I see several reasons why, except for 2014, this downward trend will continue:

Decline in manufacturing jobs

It should come as a surprise to no one that the U.S. economy has been shifting away from manufacturing jobs and toward a service-based economy. Even before to the Great Recession of 2008, manufacturing jobs were disappearing at an alarming rate. 2005 marked the first year since the Industrial Revolution that fewer than 10% of American workers were employed in manufacturing.

According to the Bureau of Labor Statistics, U.S. manufacturing employment fell from 19.6 million jobs in 1979 to 13.7 million jobs in 2007. Since 2007, the decline has only increased.

It stands to reason that as this trend away from manufacturing jobs continues, increased jobs in the service sector (where safety risks are often reduced) will lead to reduced lost-time workers’ compensation claims. Even if 2014 is an outlier, this trend will continue for the foreseeable future.

Increased Social Security disability claims

Obviously, people who receive Social Security disability benefits are either out of the work force or have a reduced employment capacity. While the last three decades have revealed a sharp increase in the number of Americans receiving Social Security disability, this trend has increased even more sharply over the past few years.

According to the Wall Street Journal, the number of Americans receiving Social Security disability benefits is up a whopping 42% since 2004. The actual number of Americans receiving Social Security disability benefits hit almost 11 million in 2013.

Data for 2014 shows that the number of people filing new Social Security disability claims has leveled off. However, this plateau is above the levels seen before 2013, and there is no indication that the number of such claims will actually decrease soon.

Increased focus on safety

Over the past decade, we have seen the creation of an entirely new business sector — workplace safety. Driven by both the requirements of OSHA and the workers’ comp savings realized by reducing accidents, this workplace safety business sector continues to make strides.

According to the Bureau of Labor Statistics, 4,383 fatal work injuries occurred in 2012, with 3.2 injury deaths per 100,000 full-time equivalent workers. This is a drop from the 2011 figures of 4,693 fatal work injures and a rate of 3.5 deaths per 100,000 full-time workers.

According to Amanda Wood, director of labor and employment policy at the National Association of Manufacturers, OSHA has played a role in this downward trend, but the bulk of the credit for these improvements should go to employers who are focused on a safe work environment. “I think those numbers show business’s commitment to a safe workplace,” Wood said in a recent interview with Safety and Health Magazine.

Insurance carriers have also jumped on the safety bandwagon. In years past, I would often speak with “the” safety professional with an insurance carrier. Now, carriers have entire safety divisions and even local safety professionals in every major market — all dedicated to reducing the number of workplace accidents.

A changing definition of ‘workplace’

Two technology trends are truly changing our definition of the workplace — mobile technology and internet/cloud technology. Telecommuting is now commonplace. There was a day when claims adjusters were all working from regional call centers scattered across the country. Now, more often than not, a claims adjuster is working from his or her basement…as are scores of other 21st century workers.

If all of the data accessed by an employee is available in the cloud as opposed to an office mainframe computer, it makes sense to give workers flexibility on where the actual work is performed. Employers can lower costs by reducing the amount of real estate that must be owned or leased, while employees spend less time commuting — and the average number of claims related to workplace accidents keeps dropping.

Combine this trend with the current emphasis on mobile technology and one can easily see why “getting to work” may become as archaic as saying “saddle up the horse.” While using mobile technology does increase the opportunities for accidents while driving cars, this is more than offset by the physical removal of a large number of employees from company-owned “workplaces” that present even more opportunities for accidents and injuries.

Bottom line: Except for 2014, we should continue to see great strides in workplace safety and a continued downward trend in workplace injuries.

Obesity as Disability? Workers' Comp Effects

A federal district court ruled in April 2014 that obesity itself may be a disability, amounting to the first shot in a war of lawsuits on grounds of obesity discrimination and opening up additional liability for workers' compensation claims across the country.

The case is Joseph Whittaker v. America’s Car-Mart, in the federal district court for the Eastern District of Missouri. Although the case is pending in Missouri, the implications apply nationwide because the court is applying provisions of the ubiquitous Americans with Disabilities Act (ADA).

The plaintiff claims the company, a car dealership chain, fired him from his job as a general manager after seven years of employment even though he was able to perform all essential functions of his job, with or without accommodations. He alleges that “severe obesity … is a physical impairment within the meaning of the ADA,” and that the company regarded him as being substantially limited in the major life activity of walking.

Attorneys for the company had moved to dismiss the case, arguing that obesity was not a disability under the Americans with Disabilities Act, and citing language from the Equal Employment Opportunity Commission that, “except in rare circumstances, obesity is not considered a disabling impairment.”

The judge rejected the company’s position, noting: “Plaintiff has sufficiently pled a claim that he is disabled within the meaning of the ADA.”

The plaintiff’s argument could be seen as a legal extension of the medical policy change made by the American Medical Association in June 2013, when the AMA adopted a policy that recognizes obesity as a disease.

Application to workers' compensation

One of the main issues in many workers' compensation claims is whether the employee is able to return to work in the open labor market. If the employee can’t, there is a focus on whether the inability to return to work was caused by the work accident alone, or is caused by pre-existing conditions, or a combination of the pre-existing disabilities and the work-related injuries. Claims are then adjudicated based on the primary cause of the inability to return to work.

Although most states have statutes that limit an award for permanent total disability benefits to those situations where the work injury alone is the cause, the practice is must different. For example, if a claimant has pre-existing disabilities and is then injured at work and cannot return to the workforce, judges are often reluctant to award minimal benefits, knowing that the claimant cannot ever return to work. It is much easier for the judge to find that the work injury alone is the primary cause and to award permanent total disability benefits even if the work injuries are only part of the equation.

Once obesity is accepted as a valid disability, injured workers could more easily argue that their obesity is a permanent condition that impedes their ability to return to work, as opposed to a temporary life-choice that can be reversed.

Injured workers could more easily qualify for Social Security disability benefits and for permanent total disability benefits, as the work injury is usually the last event in a chain of events (including, now, a history of obesity).

Once again, employers are being asked to shoulder not only the responsibilities of a work injury but also the responsibility of dealing with issues that have little, if any, relationship to the work environment.

After the ADA became law in 1993, I remember hearing the Americans with Disabilities Act referred to as “The Lawyers Full Employment Act.” Unfortunately, that moniker is now coming closer to reality.

A Catch-22 on Hiring the Disabled

In the Missouri Court of Appeals' recent decision in Stewart v. Second Injury Fund, the facts were not in dispute: Ms. Stewart worked at Subway for a few months, suffered a moderately severe injury at work and could not return to any type of employment.

Here’s where the story becomes interesting: The claimant qualified for Social Security disability in 1997 — more than 10 years before she started working at Subway. 

Her Social Security disability was awarded based on confirmed medical conditions including arthritis, reflex sympathetic dystrophy, degenerative joint and bone disease and carpal tunnel syndrome. She continued to receive Social Security disability benefits even while she was working at Subway.

After her work injury in 2009, she filed for workers' compensation benefits, claiming that she was permanently and totally disabled.

Was the claimant permanently and totally disabled before her injury at Subway? Apparently not, because she was able to obtain that job and perform the duties associated with that job. In the absence of her injury, she would have presumably been able to continue working. 

Why would she be entitled to Social Security disability benefits if she was able to compete in the open labor market? If she was disabled in 1997, should she be entitled to more benefits when she was injured at a job that she should not have been able to obtain?

What if Subway had told the claimant during her initial job interview that she could not be hired because of her multiple disabilities? She could have sued Subway under the Americans with Disabilities Act, arguing that Subway was discriminating against her. Subway, not wanting to be sued, could have been forced to hire the claimant only to face the prospect of being liable for permanent total disability after only a few months of work.

I’m not attempting to disparage the claimant. She obtained benefits that are legally provided. My question is this: Is it fair to place employers in no-win situations where they face litigation if the employee is not hired, yet still face litigation if the employee IS hired?

This situation arises because of the myriad of state and federal laws that regulate every facet of the workplace. Every employer must wade through an alphabet soup of overlapping laws every single day (ADA, FMLA, COBRA, EFCA, EAD, ERISA, FLSA, FCRA, INA and a host of others). 

One cannot swing the proverbial dead cat without hitting five politicians giving a speech focused on creating jobs. Yet, can jobs be created by strangling the very companies that create these jobs?