Each year, our workers compensation system in Alabama faces new threats from the insurance industry. In some states, like Texas, the system has been dramatically altered leaving many injured workers unable to recover and return to gainful employment. In Alabama, injured workers with a partial disability that impacts their ability to work are often compensated at an amount below Federal poverty levels. Our state has not increased partial disability payments in over two decades! While benefits to workers are over two decades behind inflation, some of our legislators continue to propose new laws that would cut off other important benefits.
What is the purpose of our workers’ compensation laws? Why were they created? A recent article titled Workers’ Compensation: The System’s Devastating Economic Impact on Workers’ Lives provides an excellent answer:
Workers’ compensation was created for two primary purposes—to provide at least partial compensation for lost wages and to pay for medical treatment and rehabilitation services for workers injured or made ill on the job.
The problem is that our system often fails these purposes. Insurance carriers routinely refuse or delay needed medical care in an effort to save themselves money. Yet, the cost to society of leaving an injured worker unable to recover for an extended period of time is much greater. Constantly, I see denials of medical care that are simply wrong. Is it right for medical care to be refused because the insurance adjuster simply ignores the requests of the treating physician for weeks? Is it right for the insurance carrier to pick a surgeon and then subject all of their surgeon’s recommendations to some anonymous medical reviewer who may not even practice medicine? Or, to deny the requested care repeatedly because of some claim as to missing paperwork that nobody understands?
Because our system does not penalize or prevent insurance carriers from wrongfully or needlessly cutting care and benefits, the entire system is dysfunctional. The first question I am usually asked by injured workers is how quickly they can get back to regular work. Yet, needlessly delaying or denying care frustrates this. That costs the worker and his or her family tremendously. It also costs the rest of us in lost productivity. The article points out the results of allowing insurance carriers to disrupt the important goals of the system:
By compromising workers’ capacity to earn a living, injuries and illnesses unleash a cascade of destructive impacts affecting access to housing and food, stability of relationships, and poverty-related health problems.
It is unconscionable that workers’ compensation places much of the economic burden of occupational injuries and illnesses on workers and their families. This makes workers’ compensation all too often the accomplice, if not direct perpetrator, in pushing workers – especially low wage workers – into debilitating economic insecurity. Injured and ill workers report depleting their savings, sometimes taking out retirement funds or even declaring bankruptcy in their efforts to cope.
All of us need the system to work. Yet, it often does not. I have seen far too many clients who were forced into selling their possessions or declaring bankruptcy after months of begging for basic medical care so they could return to work. What’s more – the long-term trend does not look good:
Because every state has its own workers’ compensation program, there’s a dangerous race to the bottom as states compete to attract businesses by reducing workers’ benefits. In addition, the largely privatized nature of the system guarantees ever-deepening power disparities between workers and employers. This skews the system to primarily represent the interests of employers and the insurance industry, ensuring that discussions on workers’ compensation and reform initiatives are focused on the cost of the system.
Costs are important. If we are going to focus on costs, we should not simply focus on the costs to insurance carriers paying claims. They collect premiums and make a nice profit. A focus on costs should focus on the larger costs to communities of having injured workers unable to return to productive employment, unable to support their families, and unable to get the medical recovery they need.