March 17, 2016
Who Is to Blame on Oklahoma Option?
by Bob Wilson
There is plenty of blame to go around for the current mess, but a good deal of it belongs to the folks on the Oklahoma Insurance Commission.
I’ve been highly critical of the Oklahoma Option, the alternative workers’ compensation system that was recently found to be unconstitutional by that state’s Workers’ Compensation Commission. I’ve been critical of the backers of the system, as well as the employers that willingly set up plans in this closed and tightly controlled scheme. And while I’ve questioned how the Oklahoma Insurance Department, headed by Commissioner John Doak, could have approved plans so obviously deficient in comparison to those in the workers’ compensation system, I’ve never accused commissiioners of being otherwise involved. I just assumed it was stupidity, incompetence or slothfulness that allowed plans, required to provide benefits that are “equal to or better” than those provided under the workers’ comp laws of the state, to be approved for use when they were ultimately substandard.
That all changed last week, during the second opt-out session held during the 32nd WCRI Annual Issues & Research Conference. The speaker who changed my point of view was James Mills, director of workers’ compensation and captive insurance at the Oklahoma Insurance Department. Mills went on at length about how proud they were at OID to have developed a “powerful system with options” for employers in their state. I do not recall his mentioning that those options have been found to discriminate against their employees, and were therefore unconstitutional. He did not address that at all. In fact, he spoke so positively about Opt Out that he sounded to me just like the concept’s biggest promoter, Dallas attorney Bill Minick. He was just like Minick’s mini-me, or a mini-Minick, if you will. It became apparent from his presentation that the OID approvals were not borne of incompetence; no, the agency was instead directly culpable in the development and promotion of a scheme that creates discriminatory sub-classes of employees in the state.
Mini-Minick did not explain how plans that have draconian reporting requirements (most require an incident be reported in 24 hours or less, or all benefits may be denied) got approved when the state system allows for 30 days. He did not explain how plans that exclude a wide variety of injuries or conditions, like asbestos exposure or workplace violence, could be approved when the state system covers them. He did not explain how plans that do not even let an employee testify at an appeal of his denial could get by the OID. Frankly, there are many areas where the alternative plans come up short when compared with the state system, and mini-Minick didn’t explain any of them. He simply touted the OID’s desire to work to preserve these options for employers.
Clearly, Commissioner Doak appears to be a healthy proponent of the Oklahoma Option. This made clear to me why plans that have left everyone around the nation scratching their heads got approved in the first place. Of course, not every action may be intentional. There is obviously room for a little incompetence, as well. This is, after all the same insurance department that in 2012 issued an email announcement that an Insurance Commissioners Award for Tornado Awareness would be given to “the girl with the biggest [breasts].” (Seriously. Click here to read about it if you doubt me). Pesky details like proofreading emails or comparing benefit levels don’t appear to be a top priority in Doak’s department.
I suppose it is appropriate the agency is run by a man whose last name rhymes with the sound Homer Simpson makes when he is completely flummoxed.
I was speaking with some people at WCRI the morning following mini-Minick’s session when this topic came up. One of the people pointed out how employers always take the blame in situations like this, but that what they were doing was approved and legal. The problem was the legislative and regulatory environment that created the system to begin with. There is validity in that view, although the employers still should be held to account for the plans they adopted. “Because I could” was never an excuse that worked for me when I was in trouble as a child, and I suspect it will not be widely accepted in the public eye today (unless, maybe, you are Donald Trump, but that is another topic entirely).
See Also: The State of Workers’ Comp in 2016
For the failures of the Oklahoma Option, there is plenty of blame to go around, but a good deal of it apparently lies with the folks charged with watching the hen house. And it does not sound as though they understand their mistakes, which means they are likely destined to repeat them.