Month: October 2018 (Page 3 of 3)

To understand the modern concept of workers’ comp coverage and the serious threat being posed by legislation like Oklahoma’s recently overturned Opt Out Act, you must first understand the origination of workers’ comp coverage in America.

 

History of Workers’ Compensation Law

While there was likely a demand for workers’ compensation coverage prior to the Industrial Revolution, the developments made during the mid-1800’s created a labor market with new and increased risks to laborers, since the work environment was riddled with new health risks. In this new labor market laborers found themselves with injuries that were expensive and often resulted in long lasting employment limitations.

A precursor to the American workers’ comp system is the 1884 worker’s compensation legislation that was enacted in Germany, which eliminated government subsidies for workers’ compensation and placed the entire burden on employers. Of this system, the German chancellor at the time, Otto Von Bismarck was quoted to have said:

“The real grievance of the worker is the insecurity of his existence; he is not sure that he will always have work, he is not sure that he will always be healthy, and he foresees that he will one day be old and unfit to work. If he falls into poverty, even if only through a prolonged illness, he is then completely helpless, left to his own devices, and society does not currently recognize any real obligation towards him beyond the usual help for the poor, even if he has been working all the time ever so faithfully and diligently. The usual help for the poor, however, leaves a lot to be desired, especially in large cities, where it is very much worse than in the country.”

 

Setting the Foundation for Workers’ Comp in America

Over time the German law has been modified and updated. In America, the development of our modern workers’ compensation statutes was cultivated during the presidential tenure of Theodore Roosevelt. Roosevelt was passionate about workers’ compensation coverage in an era that was plagued with workplace injuries, most especially related to railway operations. To this end, Roosevelt is known for his association with legislation commonly referred to as the “Square Deal”.

On April 5, 1905, Roosevelt delivered an address in which he stated:

“It has been our profound good fortune as a nation that hitherto, disregarding exceptional periods of depression and the normal and inevitable fluctuations, there has been on the whole from the beginning of our government to the present day a progressive betterment alike in the condition of the tiller of the soil and in the condition of the man who, by his manual skill and labor, supports himself and his family, and endeavors to bring up his children so that they may be at least as well off as, and, if possible, better off than, he himself has been.”

“It is all-essential to the continuance of our healthy national life that we should recognize this community of interest among our people. The welfare of each of us is dependent fundamentally upon the welfare of all of us, and therefore in public life that man is the best representative of each of us who seeks to do good to each by doing good to all; in other words, whose endeavor it is not to represent any special class and promote merely that class’s selfish interests, but to represent all true and honest men of all sections and all classes and to work for their interests by working for our common country.”

“The good citizen is the man who, whatever his wealth or his poverty, strives manfully to do his duty to himself, to his family, to his neighbor, to the States; who is incapable of the baseness which manifests itself either in arrogance or in envy, but who while demanding justice for himself is no less scrupulous to do justice to others. It is because the average American citizen, rich or poor, is of just this type that we have cause for our profound faith in the future of the Republic.”

“Among ourselves we differ in many qualities of body, head, and heart; we are unequally developed, mentally as well as physically. But each of us has the right to ask that he shall be protected from wrongdoing as he does his work and carries his burden through life. No man needs sympathy because he has to work, because he has a burden to carry. Far and away the best prize that life offers is the chance to work hard at work worth doing; and this is a prize open to every man, for there can be no better worth doing than that done to keep in health and comfort and with reasonable advantages those immediately dependent upon the husband, the father, or the son.”

 

Risks and Threats to Injured Workers

Obviously, much has changed about our workforce and labor market since 1905, but one thing still remains:

“Far and away the best prize that life offers is the chance to work hard at work worth doing.”

These kinds of sentiments gave rise to workers’ compensation laws enacted federally and state by state. In recent years, those laws have been gradually eroded and the concept of the Opt-Out Plan arose. Most significantly laws enacted in both Oklahoma and Texas allow employers to opt out of workers’ comp coverage and develop their own workplace injury plans. The problem is that these employer-developed plans seem to cover less, exercise greater control over access to care, limit benefits, and sometimes even mandate settlements.

Even more concerning is the fact that while these employer-created plans appear to violate the law, there is little or no legal remedy to those adversely impacted. However, that all seems to be changing with a recent Supreme Court Decision in Oklahoma that ruled the State’s Opt Out Act unconstitutional. As a result, Texas is the only remaining state with an active opt out law in effect.

 

Workers’ Compensation in the State of Washington

The arguments from businesses and employers that they should have increased control over workers’ comp coverage is an argument worth hearing and a dialogue worth having. However, we must not and cannot forget what Roosevelt said 100 years ago is still true today:

“The health and wellness of our labor market is vital to the health and wellness of our economy. Laborers injured in the course of employment that are not provided with the tools and opportunity to recover and return to gainful employment become a burden to themselves and society at large.”

 

To this end, the State of Washington should be commended for the programs established by the Washington State Department of Labor and Industries, which were recently recognized internationally for statistical successfulness in returning injured workers to work. As an attorney representing injured workers in Washington State, I know there is still work to be done to improve our system, but it feels great to be in a state with such successful and positive workers’ compensation legislation in effect.

This is not a political post. The purpose of this article it to share my personal experience as to how the Affordable Care Act (a.k.a. The ACA or Obamacare) affected the lives of some of my clients. Given recent political developments, especially as they relate to healthcare coverage, I felt that I should write about my observations over the years and the current state of health insurance affairs.

 

The Enactment of the Affordable Care Act (Obamacare)

To be perfectly honest, at first I didn’t know what to think or how to feel about the creation of the Affordable Care Act. On the one hand I was happy for the people who, for the first time in years, finally had access to the very most basic healthcare they so desperately needed. On the other hand, I felt sad for the people who rarely use or need access to healthcare being forced to pay for coverage or whose coverage was becoming significantly more expensive. What was a tremendous blessing to some was a significant burden to others, and it began to rip our society apart. Those who were burdened became resentful to those receiving low or no cost healthcare, feeling that these people were receiving a hand-out or an entitlement that wasn’t earned and that was being paid for on the backs of the hardworking middle class. Those who finally had access to the healthcare they so desperately needed became resentful towards the folks who opposed the plan, feeling that they were valuing the contents of their pocketbooks over the legitimate health needs of another human being.

Gradually I came to appreciate the ACA because I could see the tangible and positive effects of the legislation in my work on a daily basis. In the workers’ compensation setting in Washington State, when an individual is so catastrophically injured that he or she cannot work, the injured worker is provided with time loss compensation equivalent to 60% of the salary the person was making at the time of injury (for a single person with no dependents). Injured workers often received health coverage while working. However, upon becoming unable to work because of their injuries, these injured workers lost their general health coverage. Sure, the medical care they needed for their workplace injuries was covered by industrial insurance, but things like asthma medications, blood pressure medications, diabetes medications, anti-seizure medications, and anti-rejections medications for prior transplanted organs were not covered. Upon losing coverage associated with employment, most of these people could not afford the costs of health coverage like COBRA or private insurance. Even worse, these people could be denied access to new coverage on the basis of pre-existing conditions.

 

Real-life Example Prior to the Affordable Care Act

First, imagine this pre ACA scenario: As a result of a major illness when you were thirty years old, you had to undergo a kidney transplant. For the remainder of your life you must take medication to prevent your body from rejecting the transplanted organ. The cost of that medication is more than $1000 per month but because you were a blue collar worker, your insurance covered the cost of the medication. You obtained the transplant, got better, and went on with your life. However, when you were 45 years old with two children, you were catastrophically injured at work. As result you lost your job and your access to healthcare and you couldn’t purchase private insurance because no insurance company would accept your pre-existing health condition. You needed the medication or you would die, so you paid for the medication out of pocket but you really couldn’t afford it.

As a result you lost your home to foreclosure, your wife left you and you lost custody of your children because the court didn’t feel you could adequately take care of them. You became depressed but couldn’t afford treatment or medication for the depression. You began to collect food stamps from the Department of Social and Health Services (DSHS), started living in a tent, and turned to street drugs to numb the pain and misery. Eventually your attorney convinced the Department of Labor and Industries (L&I) to accept responsibility for your depression so that industrial insurance would at least cover the cost of seeing a psychiatrist and getting medication. However, your ability to recover from your catastrophic workplace injury was severely, negatively impacted, and you ended up being placed on a pension, receiving that 60% salary for the remainder of your life.

 

Someone always pays

In this scenario the worker pays, the worker’s family pays, the state aid administration (in WA – DSHS) pays, L&I pays, hospitals and doctors office pay when bills aren’t, and ultimately tax payers pay so that all of the services like the Court system, DSHS and L&I can intervene. It is also highly likely that the individual would have applied and been approved for Social Security Disability benefits, placing a further drain on that system. Society pays through increased taxation to fund the administrations to intervene to provide other services in the absence of health coverage.

 

The Same Example Under the Affordable Care Act

Now the same scenario post ACA: When you were catastrophically injured and lost your job, you lost the health coverage you had while working. However, under the ACA you were able to shop the marketplace and purchase low or no-cost health coverage for you and your family. You couldn’t be turned away for your pre-existing kidney condition. Your new insurance wouldn’t cover the same anti-rejection medication but would cover a less-expensive medication. It caused side effects and wasn’t your doctor’s top choice but it was covered and it kept you alive.

The money was still tight and you lost your house to foreclosure. Your wife asked for a divorce but you maintained split custody of your kids. Eventually you recovered enough from your injury that you were retrained and you returned to sedentary work in an office setting. However, you never collected food stamps and you never left a hospital or doctor’s office hanging with a bill you couldn’t pay. You never applied for Social Security Disability benefits because you were determined to return to work.

 

Again – Somebody always pays

In this scenario the worker pays, the worker’s family pays, L&I pays for the work related injuries and retraining, the new insurance pays for the non-industrially related healthcare needs, and all of society pays through mandatory insurance coverage and associated premiums.

 

Concluding Thoughts and Personal Notes

The bottom line is that in America we value life and we pride ourselves on having the best healthcare options in the world. However, options are not really options if they are not accessible. The ACA fixed the accessibility issue at a very identifiable cost to the middle class. With the dismantling of the ACA, it seems accessibility will become an issue once again and there will still be an extreme cost to society, the difference is that it will not be as identifiable. Administrations like DSHS, L&I and even local government groups like police departments will start expending additional resources to meet the needs of uninsured individuals. Eventually the middle class will feel the monetary impact in increased taxation; it simply will not be as easily identifiable as a new or increased insurance premium was.

Anyone who has ever talked with me for long knows I am ever the optimist. I believe there must be a better solution. I would have to agree that the ACA was clearly not the most ideal solution but I don’t necessarily fault the Obama Administration for that. In the face of what people seemed to universally agree was a health crisis, I believe our elected officials had an opportunity to come together and create a plan that would work. Instead they decided to bicker and hold party lines (both Democrats and Republicans) to such an extreme that it permanently damaged the ACA. In short the ACA was set up to fail. Nothing about the current election cycle changes that. The other thing that hasn’t changed is the simple fact that someone always pays.