Tips for Reviewing Workers' Comp for the New Year

Dec. 15, 2016
While many factors are driving the costs of workplace injuries higher, these three issues are especially significant.

As we close the books on 2016 and look forward to 2017, now is the perfect time for employers to thoroughly review workers’ compensation policies and procedures.

Workplace injuries affect approximately 3.7 million workers per year, at a cost to employers of over $170 billion annually. Upon review, many employers will find that the costs associated with workplace injuries have gone up yet again.

While many factors are driving the costs of workplace injuries higher, the three issues highlighted in this article have had a unique impact on workers’ compensation claims in 2016. Each of these issues will continue to have a dramatic impact on the costs of workplace injuries unless employers take action.

1. Post-Accident Drug Testing

In May 2016, OSHA published a final rule to “improve” the reporting and tracking of workplace injuries. While the rule imposes some new electronic reporting requirements, perhaps its most significant aspect is that it limits the reporting of results of certain post-accident drug testing. This is not explicitly stated but falls under the provision that a procedure for reporting workplace injuries is not reasonable “if it would deter or discourage a reasonable employee from accurately reporting a workplace injury or illness.

The agency stated in its commentary on the rule that it views mandatory post-accident drug testing as deterring the reporting of workplace injuries, resulting in incomplete and inaccurate workplace injury data.

While the new rule does not prohibit all post-accident drug testing, employers must be wary of two aspects of the rule.

The drug testing policies most likely to violate the new OSHA rule are those that contain a universal post-accident drug test requirement.

According to the rule, employers should modify their drug testing policies to “limit post-incident testing to situations in which employee drug use is likely to have contributed to the incident, and for which the drug test can accurately identify impairment caused by drug use.” OSHA did not define a “situation in which employee drug use is likely,” but they provided some examples of circumstances where employee drug use was not likely to have contributed to the accident, including a bee sting, a repetitive strain injury, or “an injury caused by a lack of machine guarding or a machine or tool malfunction.”

The new rule requires that all post-accident drug testing identify impairment caused by the drug use, not just the presence of the drug.

Therefore, drug testing policies should require drug testing that is sufficient to identify the level of drugs in the employee’s system. For example, a urine screen might show the presence of carboxy-THC, a metabolite for marijuana. However, the mere presence of carboxy-THC does not measure impairment. On the other hand, a blood test that is positive for delta-9-THC will allow a toxicologist to render a more definite opinion with respect to impairment.

The new OSHA rule carries with it significant penalties, so employers should evaluate their drug testing policies to ensure compliance with these requirements of the new rule. Among other things, employers should consider revising their drug testing policies to provide for drug tests only after accidents in which employee drug use is likely to have contributed to the accident, and to require drug testing that can actually be used to identify impairment from drug use, not merely the existence of a drug.

2. Opioid Abuse

Recent studies have shown that the over-prescription of opioids to treat workplace injuries causes significant increases in the costs of claims, increases the risk that the injuries will become chronic, and increases the risk of additional injuries. A Workers’ Compensation Research Institute study showed that opioids represent only 3% of the cost of shorter claims, but in longer-term claims that amount grows to 15 to 20%. Dr. Leonard Paulozzi of the Centers for Disease Control (CDC) has noted that opioid abuse has  become “more prevalent among the injured worker population,” with the highest overdose rate being middle-age workers.

Employers can take steps to curb the over-prescription of opioids and the associated costs. The CDC has issued guidelines governing opioid prescriptions that seek to control and reduce opioid prescriptions. And some states have implemented their own guidelines to reduce the over-prescription and abuse of opioids.

Employers should work with their carriers, adjusters and workers’ compensation attorneys to utilize those guidelines to reduce the cost of opioids. It is important to note that these guidelines have been implemented in piecemeal fashion, with little consistency or coordination between the states. Therefore, employers in states without any opioid guidelines would be well served to encourage and lobby for the adoption of the CDC (or similar) guidelines within their states’ workers’ compensation systems.

3. Disconnect Between Workers Comp and Other Laws

The complicated and dangerous interplay between workers’ compensation laws and state and federal employment laws like the Americans with Disabilities Act (ADA) and the Family Medical Leave Act (FMLA) has persisted in 2016. Once an employee sustains a workplace injury, the employer traditionally turns to its workers’ compensation carrier, third-party adjusters, attorneys, and other outside resources to ensure that the injured employee is provided only those benefits to which he or she is entitled under the applicable workers’ compensation law. This can result in a claims adjuster making decisions regarding an employee’s return to work, the job duties of that employee upon their return to work, and even workplace accommodations. Those decisions may very well overlap with the ADA, the FMLA, or similar state laws, but they are often made without adequate consideration of those laws.

There are a number of possible reasons for this disconnect, but the fundamental cause is a lack of coordination between those people handling the workers’ compensation claim (the risk managers, adjusters and workers’ compensation attorneys) and those who are responsible for compliance with the various employment laws (human resources personnel and employment attorneys).

Therefore, employers should take care to ensure that the risk managers, adjusters and attorneys handling their workers’ compensation claims coordinate with their human resources personnel. Employers should also review their workers’ compensation practices in conjunction with their FMLA and ADA policies to ensure that their practices comply with those laws.

For instance, employers subject to FMLA should consider designating time off work for a work-related injury as FMLA leave in order to avoid a situation where the employee is entitled to more protected leave than FMLA requires. Employers should also be cautious prior to terminating an injured employee and/or requiring that employee to resign as part of a workers’ compensation settlement. Those practices could run afoul of the FMLA and the ADA. 

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