Historically worker’s compensation does not cover community spread diseases (i.e., common cold/flu) because they generally cannot be tied back to a workplace. With the COVID-19 pandemic, some workers and workplaces have been deemed essential and present a unique problem when considering worker’s compensation coverage. As a result, some states recently have implemented amendments to their state workers’ compensation statutes or have issued other authority to make it easier for healthcare workers, first responders, or other essential workers to receive workers’ compensation benefits, by providing a presumption of coverage for these types of employees who test positive for or are impacted by exposure to COVID-19. Each state is unique in its definition of who is “essential,” there are instances where some industries, otherwise not thought of as essential are being defined essential during the pandemic. A presumption places the burden on the employer and insurer to prove the infection did not happen at the workplace or in the course of work. Absent that, it is presumed to have occurred at or due to work and is covered by worker’s compensation. The level to which any essential employee may be able to prove that they contracted the disease at work and therefore be eligible for benefits relies on the status of this presumption in every state.
Self-funded plan sponsors must be sensitive to the possibility that COVID-19 may have been contracted in the course of work, therefore it is imperative to at least attempt to rule out worker’s compensation before paying the claim under the plan. It is much more difficult to have a claim paid under the health plan, then later determine it should have been paid under worker’s compensation.
Diversified Response: In an attempt to avoid plan payment of a worker’s compensation claim, we look at each COVID-19 claim and will reach out to the plan sponsor for information regarding the circumstances surrounding the claim. We realize that this adds an additional onerous burden to plan sponsors, however, our intent is to avoid health insurance subrogation against the worker’s compensation carrier which can be an arduous, drawn out process.
Items to consider when evaluating if the claim is for worker’s compensation:
- Is the employee or the workplace considered essential under their state’s jurisdiction?
- Does the state have presumptive worker’s compensation rules? If so, does it apply to all essential works or only first responders and healthcare workers?
- Has the claim been filed with the worker’s compensation carrier for a determination?
Additionally, stop loss carriers will most definitely require this information/documentation listed above should the member reach stop loss and a claim for reimbursement is submitted.
The self-funded plan sponsor operates as the fiduciary of the plan and its members. By law, the fiduciary must act prudently, protect the plan and apply its terms judiciously to avoid exposing the plan to unnecessary costs. Our goal as your plan’s Third Party Administrator is and remains to assist our clients operate their self-funded plans to run efficiently, cost effectively and to meet its fiduciary responsibilities.