Within the last year I participated on several blogger panels at conferences around the nation. For at least two if them, the question of potential intervention in workers' comp by the Federal Government was broached. Almost all involved unequivocally stated that this would never happen; workers' comp has been, is and shall remain a state controlled issue. While I was not forecasting a “takeover” of comp by the feds, I was one of the lone voices predicting that federal intervention in workers' compensation was a real possibility.

And with statements last week by the Secretary of Labor, it appears the Feds may be poised to “get all up in our bidness”; and the Opt Out movement is the convenient doorway they are going to use.

NPR reported last week that “U.S. Department of Labor Secretary Thomas Perez says his agency will use its “bully pulpit” to strike at what he calls “a disturbing trend” that leaves workers without medical care and wage replacement payments when they are injured on the job.” The bulk of Secretary Perez' comments are directly related to Oklahoma Opt Out and Texas Non-Subscription, but there is a statement at the end of the article to which our industry would be wise to pay attention. It simply notes, and I quote: 

Perez says the Labor Department is commissioning a report about the opt-out trend and cutbacks in workers’ comp benefits “to document the precise nature of this problem across the country.”

Pay special attention to that part about “cutbacks in workers' comp benefits”. We have some culpability there.

Skeptics will point out that current law gives the DOL very little direct control over the issues it is threatening to address. I would suggest, however, that the use of the phrase “bully pulpit” is indicative of a broader strategy to address the concerns of the agency. I can't say for sure, but I imagine the 60 plus employers who selected to Opt Out in Oklahoma are delighted that they are about the become the target of the DOL's potential wrath on the topic. I am also certain that all the non-subscribers in Texas are thrilled to have the activities of their northern neighbor thrust them into the spotlight as well. There are many ways the DOL could make life difficult for companies it believes are violating the basic rights of their employees. Current law be damned; as the old saying goes, there is more than one way to skin a cat.

I would suggest, however, that Opt Out is not the only concern of the Federal Government. Of equal interest to them is a program that is actually (IMHO) the Achilles Heal of workers' comp and its continued independence.  That program is a (soon to be bankrupt) little affair commonly called SSDI. While statistics are not clear, it is estimated that as many as 15% of SSDI beneficiaries are in the program as a result of a workplace injury. Our industry has not done an acceptable job of keeping people out of that program. With the continued push for reduced benefits, the concept of fault being introduced in areas of comp, the consolidation and growing “impersonalization” of the claims handling processes, we have a recipe for disaster that will only feed applicants to the SSDI system. As Joe Paduda once commented in one of those blogger panels, “We have become a disability machine”.

I believe the DOL and other parties can hold strong influence over Congress to act on that point.

This would not be unprecedented. The feds have already interjected their oversight on elements of our processes. The entire MSA industry was borne of efforts to protect Medicare and the taxpayer that supports it. Why would we think the government would view the continued transfer of obligations to SSDI any differently?

So, my question to the industry is this: Did the Federal establishment of MSA's make things easier for the injured worker? Did it simplify the process, or enable better claims outcomes? Of course not. It only layered more process and expense onto an already complex and burdensome system. Why would our expectations of SSDI protective actions be any better?

Instead, the better solutions reside within the industry itself. Several weeks ago I wrote an article asking “Who Will Lead the National Conversation on Workers' Comp?” As a result of that article and the dedication of a number of professionals around the country, that conversation will soon be underway. The IAIABC has dedicated part of their upcoming Spring Forum to the effort, as well as committed to assisting others with the dialogue over the next year. We have also assembled what is being called the 2016 Workers' Comp Summit, happening in May. That two-day meeting will see an unprecedented collection of industry leaders and innovative thinkers, laying the groundwork for an extended conversation on comp. We need to take that opportunity to take workers' comp from a system concerned about managing compensation, to one that focuses on recovery.

As far as the Federal Government and Opt Out, I believe we have only seen the surface of a much broader effort. Oklahoma Opt Out has laid the red carpet for the feds, and will be bringing them to our dinner table. From there it is just a brief walk to the kitchen. We'd best make sure our recipes for success are in place.

We better start talking. And then we best walk the walk defined by all that talk.

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