Things you should know

COVID-19 pandemic information

  • Worker advocacy groups create guidance for apparel and textile workersThe Worker Rights Consortium and the Maquiladora Health and Safety Support Network have issued a set of guidelines intended to protect apparel and textile workers during the COVID-19 pandemic.
  • EPA issues respirator guidance for agricultural pesticide handlersThe Environmental Protection Agency (EPA) has issued temporary guidance intended to help protect workers who handle agricultural pesticides against exposure to COVID-19.
  • ‘Extremely hazardous’: Alert warns against using ethylene oxide to sterilize masks, respiratorsEthylene oxide should not be used to sterilize filtering facepiece respirators for reuse because “this extremely hazardous toxic chemical poses a severe risk to human health,” the Washington State Department of Labor & Industries warns in a new alert.

 

NLRB: Employers can ban cellphone use if…

Adding to an earlier decision related to driving and cellphone use, The National Labor Relations Board (NLRB) recently decided that it is legal for employers to ban the use of cellphones by employees when the restrictions are based on safety and security concerns. The new case involved Cott Beverages Inc., an American-Canadian beverage and food service company, which prohibits cell phones on the shop floor and work stations. While The Board’s May 20 decision recognized that this rule would potentially infringe on employees’ ability to make calls or recordings about workplace issues, it is outweighed by the company’s legitimate business interests.

 

Contracting trades lead in opioid prescriptions in workers comp

Although opioid use has declined in the contracting industry, workers compensation claims still have higher opioid usage and almost double the costs when compared with other industry groups, according to a report, released by the National Council on Compensation Insurance. The average cost per claim in construction is $12,760, compared to $5,608 in all other industry segments.

 

WCRI state data on opioid regulations

As of 2020 most states have regulations on prescribing and managing opioids, but only 15 states have drug formularies and only 17 states definitively include “mental health services” for “drug rehabilitation” in workers comp statute, according to a report by the Workers’ Compensation Research Institute (WCRI).

 

CMS to authorize MSPRP users to view and print conditional payment correspondence

The Centers for Medicare and Medicaid Services (CMS) has issued a notice that starting July 13, 2020, authorized Medicare Secondary Payer Recovery Portal (MSPRP) users will be allowed to view and print CMS conditional payment correspondence.

 

Marijuana tops list of substances identified in CMV drivers’ failed drug tests: FMCSA

The first report to use data from the Federal Motor Carrier Safety Administration’s new Drug and Alcohol Clearinghouse shows that, from the database’s Sept. 28 launch through May, marijuana was the most common substance found in positive drug and alcohol tests among commercial motor vehicle drivers. According to the report, 19,849 CMV drivers had at least one violation, including 10,388 positive tests for marijuana. and were unable to operate until completing the return-to-duty process.

 

Preparing chemical facilities for extreme weather events: CSB releases safety alert, video

The Chemical Safety Board has published a safety alert and video intended to help hazardous chemical facilities prepare for hurricanes and other extreme weather events.

 

State News

California

  • Became the first state to pass a regulation requiring insurance companies to reduce premiums paid by employers for workers compensation insurance, effective July 1.
  • Adopts first in the nation workplace safety standard protecting nighttime agricultural workers.

Florida

  • Policyholders of the Florida Workers Compensation Joint Underwriting Association, a self-funding plan for employers unable to purchase insurance in the voluntary market, will be eligible for the premium refund, totaling $27.6 million.

Illinois

  • On June 5, Gov. J.B. Pritzker signed H.B. 2455, which creates a rebuttable presumption for essential workers, including first responders, who presumably contracted COVID-19.
  • Workers’ Compensation Commission has posted dial-in numbers, locations, and times for July arbitration proceedings.

Massachusetts

  • The Department of Industrial Accidents will no longer accept certain forms through the mail – Form 105, an agreement to extend the 180-day payment period, and Form 113, agreement to pay compensation. The forms must be filed by email and can be sent to DIA-Form105conciliation@mass.gov and to DIA-Form113conciliation@mass.gov.

Michigan

  • Gov. Gretchen Whitmer issued an executive order on June 17 that provides a rebuttable presumption for certain workers who believe they contracted COVID-19 on the job.

Tennessee

  • Two bills that recently passed the General Assembly are summarized on the Bureau of Workers’ Compensation website. One bill extends the deadline for an injured employee to file a claim for increased benefits. The other adds requirements for out-of-state construction companies and strengthens enforcement against uninsured businesses. As of this publication, the laws have not been signed by the governor.

Virginia

  • The Safety and Health Codes Board is creating an emergency temporary standard to protect employees from the spread of COVID-19. Employers who fail to comply with the standard may be fined $13,047 for a single violation, $130,463 for willful and repeat violations, and $13,047 per day for failing to abate the risk. Employers may receive reduced penalties based on the size of their workforce, but the minimum penalty is $600. It is slated to take effect July 15.
  • The Insurance Commission posted new rules that will help implement HB 46 beginning July 1. Under the new law, employers are required to notify workers within 30 days if they intend to accept the claim, deny the claim, or if they will be seeking further information. Additionally, under the law, when the employer denies a claim, they must provide details for the denial. Failure to meet these requirements will result in a $5,000 fine per claim.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

HR Tip: New EEOC guidance related to COVID-19 and family members

In recent guidance (Question D.13), the EEOC said that the Americans with Disabilities Act (ADA) does not require employers to accommodate workers who want to avoid exposing family members who are at higher risk of severe illness from COVID-19.

“The ADA does not require that an employer accommodate an employee without a disability based on the disability-related needs of a family member or other person with whom she is associated. For example, an employee without a disability is not entitled under the ADA to telework as an accommodation in order to protect a family member with a disability from potential COVID-19 exposure. Of course, an employer is free to provide such flexibilities if it chooses to do so. An employer choosing to offer additional flexibilities beyond what the law requires should be careful not to engage in disparate treatment on a protected EEO basis.”

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

OSHA PPE requirements and COVID-19

COVID-19 has not changed an employer’s responsibilities nor the primary tenets of OSHA’s PPE Standard. Employers must begin by conducting a hazard assessment in accordance with the PPE standard (29 CFR 1910.132) to determine the PPE requirements for their unique work site. PPE should be treated as the “last line of defense” in the Hierarchy of Controls. Since elimination or replacing the hazard is unfeasible, the first line of defense is engineering controls. These are mechanical methods of separating an employee from the exposure to COVID-19, such as improved air filtration systems, increasing ventilation rates, or installing physical barriers, such as clear plastic sneeze guards.

The second line of defense is administrative controls, which include focusing on changing human behavior to reduce exposure to a hazard. Examples include asking sick employees to stay home, minimizing contact with virtual meetings, telework, making it easier for workers to stay six feet apart from each other, staggered shifts, and training workers on COVID-19 risk factors and protective behaviors. It also includes providing the resources for safe work practices such as face coverings, no-touch trash cans, hand soap, alcohol-based hand sanitizers, disinfectants, and disposable towels for cleaning work surfaces.

After considering engineering and administrative controls as well as safe work practices, employers must determine if PPE (such as gloves, gowns, surgical masks, and face shields) is necessary for employees to work safely.

In its recent Guidance on Returning to Work, OSHA reminds employers to reduce the need for PPE in light of potential equipment shortages. “If PPE is necessary to protect workers from exposure to SARS-CoV-2 during particular work tasks when other controls are insufficient or infeasible, or in the process of being implemented, employers should either consider delaying those work tasks until the risk of SARS-CoV-2 exposure subsides or utilize alternative means to accomplish business needs and provide goods and services to customers. If PPE is needed, but not available, and employers cannot identify alternative means to accomplish business needs safely, the work tasks must be discontinued.”

Special considerations related to COVID-19:

  • If temperature screening of employees and/or visitors is part of your safety program, be sure the temperature taker is trained and protected from exposure with the proper PPE.
  • Cloth face coverings are not PPE. However, they are intended to reduce the spread of potentially infectious respiratory droplets from the wearer to others. Since they are not considered PPE the employer doesn’t have to pay for them, however, it is a smart move and reassuring message to employees. OSHA has taken the position that the General Duty Clause, Section 5(a)(1), may require employers to provide such masks as they are a feasible means of abatement in a control plan. Moreover, some state and/or local governments are not only requiring employees to wear face coverings at work but are also requiring employers to provide the cloth masks.

    For more information, review OSHA’s recent Q & A on face coverings.

  • When employers require employees to wear masks, there should be specific written regulations about when they must be worn, how to care for them, what medical or other protected reasons are valid exceptions, and what are the consequences if employees decline to wear them and do not meet the exception criteria. Training also is a good idea so employees can understand they do not substitute for social distancing or other administrative controls.
  • Employers must also be aware of situations where mask wearing can make it harder to breathe and do not in themselves create a hazard. For example, the California Department of Industrial Relations, in issuing its annual summer notice to employers on heat illness prevention noted, “Employers should be aware that wearing face coverings can make it more difficult to breathe and harder for a worker to cool off, so additional breaks may be needed to prevent overheating. Workers should have face coverings at all times, but they should be removed in outdoor high heat conditions to help prevent overheating as long as physical distancing can be maintained.”
  • N95 masks are considered respirators and if required in the workplace are subject to significant regulatory obligations under 1910.14. However, if an employee brings their own N95 or similar filtering facemask, they should be allowed to voluntarily wear them. The only regulatory burden is to provide the employee Appendix D of 1910.134. It is recommended that other types of respirators such as half-and-full-face, tight-fitting respirators, and PAPR’s be prohibited.
  • In March and April, OSHA issued temporary enforcement memoranda on relaxing respiratory protection enforcement.
  • Some employers have opted to make gloves available to workers, particularly those in work settings where employees are frequently touching the same surfaces or objects. Gloves should cover the entire hand, up to the wrist and employees need to be instructed on the proper way to remove clothes to ensure that it does not cause contamination.

What type of PPE is best for your workplace?

OSHA’s Guidance on Preparing Workplaces for COVID-19 identifies PPE requirements based on four risk categories of worker exposure to COVID-19. Workers in the very high-risk exposure level, such as healthcare, laboratory, and morgue workers are likely to need to wear gloves, a gown, a face shield or goggles and either a face mask or a respirator. Workers who interact with known or suspected COVID-19 patients should wear a respirator. The same PPE use is recommended for workers in the high exposure risk category, including healthcare delivery and support staff, medical transport workers, and mortuary worker.

The moderate exposure risk category includes those that require frequent and/or close contact with the general public in areas with community transmission of COVID-19, such as teachers, retail outlets, restaurants, and other public businesses. OSHA recommends that workers in this category wear some combination of gloves, a mask, gown and/or a face shield or goggles based on the level of exposure. For those in the low exposure risk category, such as teleworkers, OSHA does not recommend PPE.

OSHA has also published guidance for many specific industries that offers recommendations for engineering and administrative controls as well as PPE. The PPE Safety and Health Topics page provides additional information about PPE selection, provision, use, and other related topics.

Takeaway:

Employers can help protect themselves from OSHA fines and enhance their return-to-work protocols by:

  • Updating their Injury and Illness Prevention Program to align with Fed and State OSHA guidance and any specific industry guidance.
  • Implementing the generally applicable infection prevention control measures identified above.
  • Maintaining any records on safety and health measures implemented.
  • Documenting all training provided to employees.
  • Recognize that new guidance is being issued at the federal and state level almost daily and stay up to date.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

Early data guides employers on three key workers’ comp issues and COVID-19

Background: Divergent pressures on premiums

There’s been much speculation that workers’ comp will drive significant losses in the property/casualty industry as a result of COVID-19. On the one hand, there is the explosion of presumption laws that discard the basic tenet of workers’ comp that employees must prove they were exposed to the virus during the course of their employment and on the other hand, there are plummeting premiums driven by business closures and dramatic declines in payrolls.

In June, Arkansas, Illinois, and Michigan joined 13 other states in extending COVID-19 presumptive coverage and 12 other states are considering new laws or executive orders. The laws vary significantly, covering different groups of workers and some are rebuttable while others are conclusive. Some are retroactive, while others go into effect in conjunction with the order or law. Employers should keep up-to-date with these rules as they continue to evolve. The National Council on Compensation Insurance (NCCI) has a helpful tracker.

How this impacts premium will also depend on the state Rating Bureau’s position on including or excluding COVID-10 workers’ compensation claims on the experience mod. To date, the following states have adopted rules that exclude COVID-19 claims from the experience mod: Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Tennessee,Vermont, Virginia, West Virginia, and Wisconsin.

Also, the costs of many existing claims are rising. The restrictions on nonemergency medical care have meant longer recovery periods and delayed surgeries for injured employees. Delays in adjudication have also extended the life of claims.

Countering this upward pressure on premiums is the dramatic decline in payrolls from furloughs, layoffs, reclassifications, and exclusions of money paid to employees who are not working. PPP dollars ran out at the end of June and employers who had to keep workers on the payroll to qualify, won’t have to keep them “employed.”

According to CalMatters, only 1,098 workers comp claims were filed in California in May, compared with more than 50,000 in January. Although some states have urged insurers to refund premiums, similar to what was done for auto insurance, reflecting businesses’ decreased exposure to workplace injuries during the COVID-19 pandemic, California became the first state to pass regulation requiring insurance companies to reduce premiums paid by employers for workers compensation insurance. This emergency regulation is effective July 1, applicable to all employers in the state, retroactive to the state’s March 19 stay-at-home order and expires 60 days after the order is lifted. The amount of refund has not been calculated.

While it’s clear that these trends dramatically alter the workers’ comp landscape, uncertainty abounds and it’s too early to determine the overall impact. However, early claims data shed light on what’s occurring now.

COVID-19 claims

In Florida, the Division of Workers’ Compensation reported that there were 3,807 indemnity virus-related claims filed as of May 31. About 45% (1,718) of the claims were denied. Health care workers and those working in protective services accounted for 83.3% of the claims. About 55% of the claims from protective service workers were denied and 30% for health care workers. Service industry workers represented 9.1% of claims, office workers 6.1%, and airline workers 1.5%.

While the data did not include medical-only claims, experts have said that most coronavirus claims involve time off from work. The claims amounted to more than $3.4 million in benefits paid so far, or about 3% of the total amount of comp benefits paid for all types of claims from January through May.

Florida has a limited presumption for frontline state employees including first responders, corrections officers, child safety investigators, members of the Florida National Guard, and others who are required to contact people infected with COVID-19.

In Ohio, a monopolistic state but one without a presumption rule, some 23% of claims were denied by the state-run comp program, and 35% of COVID claims were denied by self-insurers.

In Colorado, where a presumption law was introduced in the Senate on June 2, the state’s largest workers’ comp insurer, Pinnacol Assurance, reported to the Colorado Sun that as of mid-May, it had received nearly 1,000 coronavirus-related claims. “But it said the majority of those – 60% – were filed out of an abundance of caution and were dismissed after it was later determined that the worker did not contract COVID-19.”

Of the roughly 400 claims remaining, Pinnacol said it has agreed to pay out on the majority of them, with the average claim amount running around $13,000, The majority of claims has come from first responders and healthcare workers.

According to the article, a spokesperson for Pinnacol said that if the presumption for first responders, health care workers, food-processing workers, and grocery store workers who test positive for COVID-19 passes, there could be a 27 percent increase in workers’ compensation premiums for employers in those industries. If the presumption just applies to first responders and health care workers, the premiums in those industries would triple.

The state has received 1,425 claims, about 60% have been denied by employers and about 27% approved by employers. The remainder are still being processed and investigated. The claims submitted include six for worker deaths; one approved and five remain under investigation.

In California, more than 5,000 COVID-19 related claims were filed from January to May, according to CalMatters. More than 1,000 were denied, but that was before the Governor signed an Executive Order extending protections for essential workers infected on the job on or after March 19.

According to a report by the California Workers’ Compensation Institute that examined over 1,000 claims filed as of April 30, 35% were denied, 28% accepted, and the remainder under investigation. The primary reason for denial was negative results on COVID-19 tests (70%). Lack of exposure at work accounted for 15% of denials and other reasons included refusal to take a test, working from home, and lack of symptoms. About 41 percent of workers’ comp claims were made by health workers, with another 32 percent by first responders including police and firefighters.

In the blog, Managed Care Matters, Joe Paduda of Health Strategy Associates reports that 35 workers’ comp insurers, state funds, TPAs, and service providers and large self-insured/self-administered employers were surveyed on the impact of COVID-19 claims. Payers have received about 33,000 COVID-19 claims to date and accepted just over 20% of all claims filed. The most common reasons for denial are a lack of a diagnosis, no symptoms, and/or a negative test for COVID-19.

The good news is that only a few have been very expensive claims (>$200,000) involving ICU and ventilator care.

The survey also reported on the “non-COVID” effects:

  • a drop of 25% to 50% in new injury claims since the outbreak
  • slower return to work due to an inability or unwillingness to access care and/or adjudication processes
  • respondents’ estimate that 2020 will end with a 20% decrease in the total number of claims

Of course, the impact will vary by industry with disproportionate COVID-19 claims in public entities and healthcare, and small businesses, retail, hospitality, and travel hardest hit by declining payrolls.

Takeaway

It is premature to make predictions bases on this data, particularly since much comes from the early months when there was a shortage of diagnostic tests. However, it does provide guidance on how employers should proceed when faced with a COVID-19 claim.

  • Understand the state’s position on presumption.
  • Know what information the insurance company wants to process the claim and how to identify it as a COVID-19 claim. Share any information about the job/employee that may relate to a perceived lower or higher risk of exposure from the workplace.
  • Be proactive. Find out when the symptoms began and if the diagnosis has been confirmed. Determine if the worker had contact with a person known to be infected with COVID-19 and when and where that contact occurred. Determine if immediate family members are currently showing similar symptoms or recently traveled to any high-risk areas.
  • Ask what other employees the worker may have had close contact with recently and begin contact tracing.

Substance abuse and mental health issues surge

The data indicates that employers can face a surge in addiction, stress, depression, and mental health issues as employees return to work. Isolation, uncertain job security, family distractions, and a lack of access to traditional support networks have caused some employees to turn to alcohol or drugs. At least 30 states are reporting increases in fatal opioid overdoses amid the COVID-19 pandemic. The percentages of individuals who sought screening for anxiety and depression in May were 370% and 394% higher, respectively, than in January, reported the nonprofit, Mental Health America.

Prescriptions in the U.S. for anti-anxiety medications and antidepressants rose 10.2% and 9.2%, respectively, in March compared with March 2019 according to health-research firm IQVIA Holdings Inc. Sales of alcoholic beverages in March were up 55% compared with March 2019 according to marketing research firm The Nielsen Co., and at least one state with legalized marijuana, Washington, reported record sales during the pandemic.

For many employees, the issues are not going to go away when they return to work, affecting employees’ well-being long after the crisis has passed. And it can continue for those who work remotely. A survey by alcohol.org found that one in three Americans are more likely to drink when working from home. The National Safety Council (NSC) is urging employers to implement substance abuse policies and procedures as part of their return to work strategy and offers free resources for employee mental health and wellbeing. Such issues can be a serious threat to worker safety and cost tens of thousands in productivity losses, absenteeism and presenteeism, and workers’ compensation claims if employers do not plan ahead.

Remote workers and cybersecurity

Almost as quickly as the pandemic brought the world to its knees, cybercriminals seized the opportunity to attack the millions working from home. Phishing attempts, the largest source of ransomware, are quickly increasing. According to Net Diligence, the average ransomware cost is $229,000 and the cost of a cyber breach for small businesses (85% of claims) is $673,787 and $8.8 million for large businesses.

In addition, data protection and managed services provider, Digital Guardian, published a report created by aggregating anonymized telemetry from January 1, 2020 through April 15, 2020, via 194 global companies. It found a 122% increase in employees copying company data to USB drives, 74% of that data was classified. Also, a 79% increase in data egress via all means (email, cloud, USB, etc.). More than 50% of observed data egress was classified data.

The Cybersecurity and Infrastructure Security Agency (CISA), a department of US Homeland Security, recently announced key cybersecurity recommendations for employees working from home.

  • Update VPNs, network infrastructure and devices used for remote work – as all devices are variables.
  • Notify employees of increased phishing attacks and offer training/guidance.
  • Ensure IT Security teams are proactively monitoring logs/devices and are prepared for incident response/recovery.
  • Implement Multifactor Authentication (MFA) on all VPN connections and wherever possible.
  • Routinely test VPN network for limitations of mass usage.
  • Do not use Public WIFI, even with a VPN.

A white paper prepared by TechAssure, a not-for-profit trade association for insurance brokers that specialize in technology-related risks, offers additional tips:

  • On all devices that employees are using to access their work environment, Multifactor authentication (MFA) is critically important.
  • Alert employees that fraudulent websites and apps are appearing daily claiming to contain COVID-19 resources, safety supplies, etc.
  • Password management is key. Reusing passwords is common, which increases vulnerability if one account is hacked.
  • Picking up the phone can avert a disaster if something appears suspicious. The client/vendor will appreciate the extra steps to confirm the request.

Cyber insurance policies might provide valuable coverage to mitigate against the possibility of a costly cyber incident during a time when many businesses can afford it the least.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

Things you should know

Database of EPA-approved disinfectants for COVID-19 pandemic available via app

The Environmental Protection Agency has released its List N Tool, a new web-based application (app) that allows smartphone users and others to quickly identify disinfectant products that meet EPA’s criteria for use against SARS-CoV-2, the virus that causes COVID-19.

States without fee schedules pay more

The Workers’ Compensation Research Institute’s (WCRI) medical price index study found states with no workers’ compensation fee schedule pay higher prices for professional services. In states without fee schedules, including Indiana, Iowa, Missouri, New Hampshire, New Jersey, and Wisconsin, prices paid for professional services were between 42% and 174% higher than the median of study states with fee schedules.

Similarly, outpatient hospital payments are higher and growing at a faster rate in states without fee schedules. Comparing hospital payments from a group of common workers’ comp outpatient surgeries in 36 states from 2005 to 2018, WCRI researchers found that states that paid a percentage of charge versus a fixed-amount fee schedule paid as much as 168% more per surgical episode than the median of study states with flat-rate fee schedules in 2018.

Top 10 private industry occupations with the largest number of injuries and illnesses, 2018

The Insurance Information Institute released its list of the top ten private industry occupations with the largest number of injuries and illnesses. It may surprise you that retail salespeople and registered nurses had more injuries than construction laborers.

FMCSA final rule amends trucker hours-of-service regulations

The Federal Motor Carrier Safety Administration has unveiled a highly anticipated final rule the agency claims will add flexibility to hours-of-service regulations for commercial truck drivers.

CMS releases new WCMSA reference guide

The Centers for Medicare and Medicaid Services (CMS) released its latest version of the WCMSA reference guide version 3.1 (May 11, 2020). The link to the CDC life table has been updated to the current CDC life table (2017) CMS has been using as of April 25, 2020, to calculate an injured worker’s life expectancy for Workers’ Compensation Medicare Set-Aside. It should only result in minor differences.

Electrical safety group creates infographic for people working from home

Aiming to promote electrical safety among people who are working from home during the COVID-19 pandemic, the Electrical Safety Foundation International has published an infographic.

“Dirty Dozen” list of 12 most egregious employers focuses on coronavirus response

The National Council for Occupational Safety and Health (National COSH) releases the report each year and this year focused on companies and organizations that allegedly are failing at preventing their employees from exposure to the novel coronavirus.

Updated COBRA Model Notice issued

On May 1, 2020, the U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) issued revised COBRA model notices (both the general notice and the election notice), along with brief Frequently Asked Questions related to the Consolidated Omnibus Budget Reconciliation Act (COBRA).

State News

California

  • Insurance Commissioner Ricardo Lara issued an order requiring insurers to provide an adjustment to the premium in the form of a premium credit, reduction, return of premium, or other adjustment as soon as possible and no later than Aug. 11, 2020. The order covers insurance lines including workers’ compensation, commercial automobile, commercial liability, commercial multiperil, medical malpractice, and any other insurance line where the risk of loss has fallen substantially as a result of the pandemic.
  • The Division of Workers’ Compensation (DWC) and Workers’ Compensation Appeals Board (WCAB) continue to expand the hearing schedule.
  • There was an 11.3% drop in workers’ compensation independent medical review letters in 2019 when compared with 2018, according to a report issued by the Workers’ Compensation Institute.

Georgia

Illinois

Massachusetts

  • Attorney General Maura Healey called on the state’s Division of Insurance (DOI) to take immediate steps to ensure that businesses pay fair workers’ compensation insurance premiums that reflect the businesses’ decreased exposure to workplace injuries during the COVID-19 pandemic.

Michigan

  • Pursuant to the Governor’s latest Executive Orders, the Workers’ Disability Compensation Board of Magistrates’ hearing schedule has been updated.

North Carolina

  • Furloughed employees who are paid will not be counted on payroll for premium calculations, the rate bureau announced in a recent circular.
  • Deputy Commissioner Hearings (Non-Medical-Motion Hearings) to Resume in June 2020 via Webex.

Virginia

  • Workers’ Compensation Commission has issued an order to return to in-person hearings on or after June 11, 2020.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

OSHA watch

Guidance on distancing

Recent guidance focuses on strategies to implement social distancing in the workplace. Spanish version. It urges employers to isolate workers showing symptoms of coronavirus until they can go home or seek medical care, establish flexible worksites and work hours, stagger breaks and rearrange seating in common areas to maintain social distance, mark social distancing with floor tape where customers are present and reposition work stations and install plastic partitions to create more distance. It also issued new procedures to make it easier for federal workers in high-risk industries to obtain workers compensation for COVID-19.

Coronavirus alerts: Industry specific recommended practices

In May, recommended business practices were released for food service, nursing homes and long-term care facilities, dental practitioners, retail pharmacies, and rideshare, taxi and car services. All business guidances released to date can be found here in English and Spanish.

COVID-19 Quick Tips Videos

New animated videos provide quick tips to keep workers safe from COVID-19:

For all the quick tip videos released related to coronavirus, including Spanish versions, go here.

Eight ways to protect meat processing workers from COVID-19

Principal Deputy Assistant Secretary Loren Sweatt outlined eight ways to protect meat processing workers from COVID-19.

Guidance is now available in English and Spanish.

COVID-19 Q & A: Social distancing in meat and poultry facilities

Q. In some areas of meat and poultry processing facilities, social distancing at 6 feet of distance may not be feasible in order to maintain continued operation at the maximum capacity possible. In these areas, are other controls, based on the hierarchy of controls outlined in the CDC/OSHA guidance (e.g., personal protective equipment) acceptable in order to maintain safe operations at the maximum capacity possible?

A. Employers should use the hierarchy of controls to control hazards and protect workers, including by first trying to eliminate hazards from the workplace, then implementing engineering controls followed by administrative controls and safe work practices, and finally, using personal protective equipment (PPE). When engineering controls, such as physical barriers, are not feasible in a particular workplace or for a certain operation, other types of controls, including PPE, may be considered in accordance with the hierarchy.

Poster and video show right way to put on, take off respirator

A poster and video detail seven steps to properly put on and remove a respirator at work.

English version of poster

Spanish version of poster

Guidance and resources from state OSHA programs

California

Indiana

Michigan

Minnesota

North Carolina

Tennessee

Virginia

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

Highlights of the 2020 NCCI Symposium: focus on what coronavirus means for the workers’ comp industry

Each year, the National Council on Compensation Insurance (NCCI), which gathers data, analyzes industry trends and legislation and prepares insurance rate and loss cost recommendations holds an Issues Symposium. Needless to say, the virtual event differed from years past, which looked at recent trends to project future performance. Like everything else the pandemic touches, the unknowns make projections a formidable task.

State of the Line

Donna Glenn, NCCI’s chief actuary began with a look at where the industry stands, which was good news. Highlights of the State of the Line address include:

  • In 2019, the industry reported a combined ratio for private carriers of 85%, making it the sixth consecutive year that the workers’ comp line of business has posted an underwriting gain. The two most recent years, including the 83% combined ratio in 2018, showed the lowest workers’ comp combined ratio since the 1930s, according to the presentation.
  • Years of profitable underwriting and healthy reserves in 2019 in the workers’ compensation sector will help the industry weather coronavirus-related claims amidst lower premiums in the coming months.
  • Claim frequency continued to decline with average lost-time claim frequency across all 38 states that work with NCCI declined by 4% in 2019.
  • Looking at types of injuries, sprains and strains decreased more quickly than most – 5.4%.
  • For body parts, back injuries decreased more than other types. Head, brain, and face injuries increased and can be attributable to the increase in motor vehicle accidents, likely the result of smartphone use.
  • Average indemnity claim severity increased by 4% relative to the corresponding 2018 value, which was in line with wage growth.
  • Medical lost-time claim severity increased by 3%, which is trending faster than personal health care costs.
  • The average indemnity claim cost in NCCI states is $54,800, including $25,300 for lost wages and $29,500 for medical costs.

Unlike previous years, the past does not give a lens into the future. It’s unknown what level of claims insurers will face from the COVID-19 outbreak or how much premium will be lost as a result of high unemployment. The extent of presumption coverage in states adopting changes to workers’ comp laws will be a major factor.

Claim activity unrelated to COVID-19 is also unpredictable. Some employees may delay care or not report claims, and those with existing injuries could see their return to work and recovery hindered by fewer jobs and doctor check-ups. Fears over unemployment can cause workers to file claims over smaller and non-acute workplace injuries.

 

Coronavirus and the Recession of 2020-Impact on Workers’ Compensation

Dr. Robert Hartwig, PhD, CPCU, presented the pandemic’s effect on our economy and the workers’ compensation system. While the industry has entered the COVID-19 era in a position of significant financial strength, the impact of the pandemic is still unfolding and is unlike anything faced before.

The impact will vary by industry. Sectors hard hit by unemployment, such as hospitality, retail, manufacturing, and tourism will see large drops in premiums. At the same time, there will be upward pressure on costs, as more states pass presumptive laws and exclude COVID-19 claims from Experience Mod ratings. Workers’ compensation coverage will spike in severity and frequency for essential workers like those in healthcare.

The bottom line is that the workers’ comp line will be severely impacted given the reduction in payrolls, flattened wages, historically low interest rates, and stock market volatility. Dr. Hartwig estimated up to a 25% drop in workers’ compensation premium written. He noted insurers have received tens of thousands of claims related to COVID-19. There have been extraordinary efforts to stretch contract language to find coverage where none exists or none was intended – especially in workers’ compensation and business interruption.

 

Workers’ compensation research: demographics and medical services

NCCI also released reports prepared by two of its research experts. Latest Trends in Worker Demographics was presented by Barry Lipton, FCAS, MAAA, practice leader, and senior actuary at NCCI. Highlights include:

  • The number of older workers (65+) in the workforce continues to increase. This age group will see the largest growth between 2018-2028 (projected 6.1 million more workers), closely followed by those ages 25-44, who will see a projected growth of 4.8 million.
  • There has been an increase in accident frequency among older workers and they lose more time for work-related injuries. The average worker will lose eight working days for an injury, while those ages 65 and older, lose an average of 14 days. Falls, slips, trips and overexertion are major causes.
  • Short-tenured employees suffer a disproportionate share of total workplace injuries. New workers with under five years of experience account for a third of all injuries, but only make up a fifth of all employment. Workers with five or more years of experience account for another third of all injuries but make up half of all employment.

Raji Chadarevian, director of Medical Regulation and Informatics for NCCI, offered Gen rX-The Next Generation of Medicine. Highlights include:

  • In 2012, non-physicians made up 47 percent of all professional services. In 2018, that share has jumped to 59 percent. Non-physicians are composed of professions like physical therapists, physician assistants, and nurse anesthetists.
  • There’s a massive increase in telemedicine services in response to COVID-19. This trend, which the industry had been slow to adopt, offers potential cost savings and accelerated care.
  • Overall opioid use is on the decline, with the share of all prescription claims receiving opioids decreasing 38 percent from 2012-2018.
  • One out of every 42 chronic pain claims received mental health services in 2018, a 20% increase since 2012.
  • There were 23 physical therapy visits per chronic pain claim during the first year of injury in 2018, a 15% increase since 2012.

Employer takeaways:

  • Employers that have experienced a reduction in payroll should be proactive in working with their insurance agent to get the insurance company to adjust premiums now rather than waiting for an audit.
  • Employers must accurately document how their operation has changed and affected the classification of employees.
  • Given the high costs of indemnity claims, a strong recovery-at-work program and good hiring practices are cornerstones to lower rates.
  • Stay focused on all safety measures and maintain a strong risk profile. No one knows exactly how the expected massive increase in costs, coupled with the reductions in premiums, will be paid. Since many of the claims will be exempt from the Experience Mod rating, it’s reasonable to guess that it will come from rate increases. Expect to see a tightening market and more rigid underwriting.
  • Safety management and loss prevention can put extra focus on short-tenured workers and older workers.
  • When the unemployment rate was at record lows, employers relaxed hiring and onboarding practices. Employers in a position to take advantage of a surging labor market pool can make the best choices with good hiring practices.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

Ten costly mistakes when reopening and operating a business during COVID-19

These challenging times are a stress test for all companies. Survival mode is not sufficient. What’s needed is an ability to lead employees through the crisis, absorb and respond to uncertainty, agility to modify the operating model quickly, and creativity to improve the experience of customers. The Internet offers an overabundance of information – google “preparing your business to reopen after COVID-19” and there are 1,780,000,000 hits. There’s no argument – it’s a daunting task. Here are ten costly mistakes to avoid:

  1. Fail to have a written, site-specific COVID-19 Exposure Control and Response Plan

    Many states and localities require businesses to develop and implement a written, site-specific COVID-19 Exposure Control and Response Plan and both the CDC and OSHA recommend adopting one. Dustin Boss, a Certified Risk Architect and Master WorkComp Advisor with Ottawa Kent Insurance, notes that any business that operates without an Exposure Control Plan will be exposed to a number of legal or business risks. These include OSHA citations, being shut down by state or local health departments, becoming a target for a wrongful death action brought by families of employees, temporary workers, customers, vendors, and/or guests. Lawyers have already started filing wrongful death suits, including high profile cases against Tyson and Walmart.

    Moreover, there is significant reputation exposure. Recently, a worker on the production line of American Fork (Utah-based Built Brands LLC), who contracted the virus along with her disabled daughter and roommate filed suit against her employer, charging she was threatened with termination when she complained about the company’s safety procedures. The case has received national attention.

  2. Fail to follow appropriate guidance

    While most business owners are responsible for making their plans to keep employees, customers, and vendors safe when reopening and operating their establishments, there are critical guidelines to incorporate. The CDC has issued detailed guidance on reopening businesses, health care facilities and providers, schools, transit, and other industries. This guidance also provides information regarding testing and data to assist with exposure and risk concerns for those industries. Joint guidance by the CDC and the EPA to clean and disinfect surfaces is available here.

    OSHA has provided general guidance for businesses as well as industry-specific guidance, which are offered in both English and Spanish. Its most recent guidance focuses on strategies to implement social distancing in the workplace. Spanish version.

    In addition, most states have provided specific guidelines that must be incorporated into the exposure plan. The best resource is the state’s dedicated webpages for COVID-19. Recognizing that each state has its own guidance, the U.S. Chamber of Commerce established the Essential Critical Infrastructure Workplace Tracker. It provides a state-by-state glance of stay-at-home orders with links to each order, start and current end dates, and other details about each state’s guidance.

    Beyond the federal and state resources, stick with sources you know you can trust such as your trusted advisors and industry and trade organizations. Professional organizations such as the National Safety Council (NSC) and the American Industrial Hygiene Association (AIHA) offer industry-specific guidance. The North America’s Building Trades Unions and CPWR, The Center for Construction Research and Training have developed national guidance on infectious disease exposure control practices for construction sites.

    Keep an open mind, constantly evaluate, and adjust your plan as operations evolve.

  3. Fail to incorporate the full range of operations in your plan, including remote workers

    Even when the plant or office has been reconfigured to conform to physical-distancing protocols, there’s a need to figure out adaptations for bathrooms, breakrooms, entrances and exits, hallways, elevators, and any other common areas. Determine how visitors, whether customers, vendors, or delivery people, will be managed. If your workforce relies heavily on public transport, you may want to consider other options such as ride-sharing subsidies or more flexible hours to avoid rush hour.

    Stay-at-home orders were issued at such speed that employers had no time for home assessments and ergonomic training. Training and investment in proper desks or chairs for those workers who will continue to work remotely for an extended period should be part of the plan. To the extent that an employer has not created or revisited their telework policy, now is the time to do so.

  4. Fail to properly communicate the plan to employees and customers

    In the early stages of the outbreak, Dr. Fauci said, “… if it looks like you’re overreacting, you’re probably doing the right thing.” If it feels like you are overcommunicating, you are probably doing the right thing, too. The fear of the virus, coupled with the fear of losing a job, is unprecedented. Tell your employees and customers early and often what you are doing to keep them safe. If you have a phased return to work and some employees are furloughed, be sure to communicate with all of them. Keep an open dialogue with employees and be transparent. Do they feel safe?

    Be specific about what you are expecting of the workers. If face coverings are required, is the company going to provide them, when they have to be worn, how they can be cleaned, can they wear a bandana, and so on. What are the consequences if they don’t comply? Identify their responsibilities to help with prevention efforts while at work by following company instituted housekeeping, social distancing, and other best practices at the workplace.

    Of course, communication and training must adhere to social distancing protocols or be safely automated. Studying “essential businesses” that stayed open during the pandemic, McKinsey researchers found that online training and education modules to familiarize employees with the new safety and hygiene protocols before they return to work played a significant role in instilling new habits.

    Ongoing reminders, whether signage, texts, or announcements to sanitize workstations, wash hands, and maintain social distance help to reinforce positive behavior as well as build employee confidence in their safety. Also, don’t assume that employees know what to do in the event of exposure or diagnosis; constant reminders are important.

  5. Fail to properly train managers and supervisors

    Managers and supervisors are the linchpins to successfully reopen and maintain business continuity. Educate and involve them in the development of new protocols before reopening. Be realistic about what the changed working conditions mean for production and discuss expectations. Not only do the managers have to adapt to changed working conditions, but they have to understand the fundamentals of assessing the risk, recognizing the hazard of COVID-19, how to handle a suspected case and even rumors of a suspected exposure. Moreover, they will be working with many employees whose mental and emotional health has been upended by the virus. They’ll need to understand at the most granular level employee sentiment about COVID-19 and their comfort level with the company’s response.

  6. Assume your workers are ready to return to workA nationwide survey of 1000 workers in late April by Eagle Hill Consulting LLC found that 54% were worried about exposure to COVID-19 at their job and 58% said the availability of protective protections like masks, gloves, and hand sanitizer would make them feel safer. Fifty-five percent say mandating employees with symptoms stay home and 53% said making COVID-19 tests available would also lessen concerns, but only 43% support employers testing for symptoms. Seventeen percent worried the test results would affect their employment.

    The good news is that most employees (71%) say their employers will be prepared to safely bring employees back to the workplace. However, there will be some workers who may refuse to work or may upset others if forced to return. Others may want to continue to work remotely. Be prepared about how you will treat these workers in a fair and non-discriminatory way and document your response.

  7. Fail to recognize the toll on physical and mental health

    For many people, this has been the most distressing time in their lives. They’re concerned about their family, economic hardship, and health. Those with physically demanding jobs may not be in shape. Some have had difficulty sleeping or turned to substance abuse and others have been severely stressed. The impact on mental health is real. Knowing that you understand what they are going through and offering resources to those in need can help to ease anxiety.

  8. Not understanding the privacy and logistic issues of conducting tests, taking temperatures, and contact apps

    Guidance from the EEOC permits certain exceptions to the traditional rules under the ADA, but it doesn’t mean that privacy rights can be ignored. Further, the guidance does not address which tests are appropriate, who should conduct the tests, how tests should be administered, what should be done to protect workers’ privacy, the reliability or frequency of testing, how the tests will be paid for and whether employees should be paid for the time they wait in line to have their temperatures taken.

    It’s important to realize that under OSHA temperatures are medical records, which must be maintained for 30 years. Some legal experts recommend minimizing the amount of data you collect, such as recording only those that exceed the COVID-19 threshold of 100.4 degrees and are sent home. Under the ADA, the information that is recorded should be treated as a confidential medical document and not placed in an employee’s personnel file.

    Employers should also review the CDC guidance on testing and any relevant state guidance.

    Similarly, companies must also decide on whether they use contact apps to track and identify people who might have been exposed when someone tests positive. To date, the EEOC has not issued guidance, but employer-based contact tracing implicates a variety of laws, including workplace laws like the Americans with Disabilities Act (ADA), other federal and state employment, civil rights, privacy, and consumer protection laws.

    Before embarking on testing or tracking, it is best to seek legal counsel.

  9. Discriminate against those considered susceptible to the coronavirus

    The CDC has identified the population that is at high-risk for severe illness, including people over 65 and those with pre-existing health conditions, and recommends that employers protect such employees by encouraging options to telework and offering duties that minimize interaction. The EEOC has also issued guidance that states that if an employer is concerned about an employee’s health being jeopardized upon returning to the workplace, the employer cannot exclude the employee “solely because the worker has a disability that places him at a ‘higher risk for severe illness'” if he gets COVID-19. Such an action is not allowed unless the employee’s disability poses a “direct threat” to his health, and cannot be eliminated or reduced by reasonable accommodation. However, it is appropriate to reach out to employees in high-risk groups and discuss accommodations that may be possible.

    In deciding who will return to work, legal experts suggest employers should follow the same procedures they would in reductions-in-force by statistically analyzing those they are asking to return and see if it is disparately impacting protected classes. If there’s a statistical anomaly, documentation is critical. A good beginning is to look at the skill sets you’ll need in the new economy and employees who are cross-trained.

    Also, employers must pay close attention to employment laws, including exempt and non-exempt classifications, overtime calculations if performing work in two positions at different rates, and benefits for existing and furloughed workers. For workers’ compensation, employers will want to carefully document all changes to their operation and job classifications, as well as employees on paid medical leave.

  10. Lose focus on other health and safety risks

    It’s well-known that distracted workers are prone to make more mistakes and safety incidents increase. There’s little doubt that COVID-19 and concerns about job security are major distractions. Reinforce the importance of safe work practices and while social distancing may make pre-COVID-19 meetings impossible, alternative methods should be used.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

OSHA changes course again on recording of COVID-19 cases and increases onsite inspections

OSHA’s shifting guidance has employers’ heads spinning. For the third time since the onset of the pandemic, OSHA has issued guidance about recording COVID-19 cases. In March, it sent a memo reminding employers that COVID-19 diagnoses are recordable events, but in April it backtracked, significantly limiting the reporting requirements. Specifically, only cases related to health care workers, first responders, and correctional institution employees had to be recorded. All other employers were exempt except in cases in which “objective evidence” existed that a COVID-19 infection was work-related or the evidence was “reasonably available” to the employer.

New guidance announced on May 19 overrides the April guidance.Essentially, the new guidance requires an individualized work-relatedness analysis for all industries.

Effective May 26, COVID-19 cases are recordable if the illness is confirmed as COVID-19, the illness is work-related as defined by 29 CFR 1904.5 and the case involves at least one of the general recording criteria listed in 29 CFR 1904.7. The criteria include death, days away from work, medical treatment “beyond first aid,” loss of consciousness, and restricted work or transfer to another job. The revised enforcement policy directs that employers “make reasonable efforts” to investigate confirmed cases of coronavirus in the workplace to determine if they were more likely than not work-related.

Recognizing employee privacy concerns, OSHA indicates that employers are “not expected to undertake extensive medical inquiries” and may rely only “on the information reasonably available to the employer at the time it made its work-relatedness determination.” According to Conn Maciel Carey LLP, an OSHA/MSHA Workplace Safety, Labor and Employment Boutique Law Firm, it will be sufficient in most cases for employers to:

  1. Ask the employee how he believes he contracted the COVID-19 illness
  2. Discuss with the employee his work and out-of-work activities that may have led to the COVID-19 illness; and
  3. Review the employee’s work environment for potential SARS-CoV-2 exposure (which should be informed by any other instances of workers in that environment contracting COVID-19 illness).

During the investigations, employers need to consider workers’ privacy and refrain from disclosing the names of those who have tested positive for the virus to others in the workplace and should document all aspects of the investigation. OSHA notes, “If, after the reasonable and good faith inquiry described above, the employer cannot determine whether it is more likely than not that exposure in the workplace played a causal role with respect to a particular case of COVID-19, the employer does not need to record that COVID-19 illness.”

To assist employers in identifying work-relatedness, OSHA describes the types of evidence that may weigh in favor of or against work-relatedness. For instance, OSHA says, COVID-19 illnesses “are likely work-related” if:

  • Several cases develop among workers who work closely together and there is no alternative explanation;
  • The illness is contracted shortly after lengthy, close exposure to a particular customer or coworker who has a confirmed case of COVID-19 and there is no alternative explanation; and
  • Job duties include having frequent, close exposure to the general public in a locality with ongoing community transmission and there is no alternative explanation.

The guidance also indicates that an employee’s COVID-19 illness likely is NOT work-related if:

  • Only one worker in a general vicinity in the workplace contracts COVID-19;
  • Job duties do not include having frequent contact with the general public, regardless of the rate of community spread;
  • Outside the workplace, the infected employee associates closely and frequently with a non-coworker (e.g., a family member, significant other, or close friend) who has COVID-19.

As Conn Maciel Carey LLP points out, the biggest differences between the April 10 guidance and the May 19 guidance are:

  1. There is no exemption from conducting case-by-case work relatedness analyses for medium and low-risk exposure workplaces; and
  2. The new memo expands the examples of the type of objective evidence of likely work-relatedness from just a cluster of positive cases, to also include cases where someone contracts the illness after a lengthy exposure at work or has job duties that involve frequent, close exposure to the general public.

The firm also notes the importance of the term “no alternative explanation.” Where there is widespread community spread, it is important to document if an employee acknowledges such interactions away from work.

When determining whether an employer has complied with the revised policy, OSHA instructs compliance officers in a memo issued the same day to apply these considerations:

  • The reasonableness of the employer’s investigation into whether the COVID-19 case was work-related
  • The evidence available to the employer
  • The evidence that COVID-19 was contracted at work

Consistent with existing regulations, employers with no more than 10 employees and certain employers in “low-hazard industries” do not have an obligation to report COVID-19 cases unless a work-related illness results in death, in-patient hospitalization, amputation, or loss of an eye.

It is important to remember that even if a COVID-19 is recordable, it does not mean that it will be compensated by workers’ comp. OSHA recordability does not impact workers’ comp determinations and vice versa.

What employers should do now

For employers to prove a reasonable and full faith inquiry, Dustin Boss, a fellow Certified WorkComp Advisor offers this advice:

  • Implement preventive measures and methods for contact tracing as employees return to the workplace
  • Develop procedures to respect employee privacy during investigation into work-relatedness of a confirmed case of COVID-19
  • Update 2020 OSHA records and retrain staff members responsible for tracking injuries (if late, submit 2019 data which was due March 2)
  • Focus on minimizing the risk of transmission in the workplace and develop procedures to investigate the circumstances surrounding employees who test positive for COVID-19

Beyond the recording requirements, employers are exposed to the possibility of OSHA citations. As the fear of contracting the novel coronavirus permeates the workplace, thousands of employees have complained to OSHA regarding the insufficiency of their employers’ protection against COVID-19. In the same news release announcing the new enforcement guidelines, OSHA announced that it is increasing in-person inspections at all types of workplaces. “The new enforcement guidance reflects changing circumstances in which many non-critical businesses have begun to reopen in areas of lower community spread. The risk of transmission is lower in specific categories of workplaces, and personal protective equipment potentially needed for inspections is more widely available. OSHA staff will continue to prioritize COVID-19 inspections, and will utilize all enforcement tools as OSHA has historically done.”

Boss points out that enforcement of COVID-19 issues falls under the catch-all General Duty Clause that employers will provide a place of employment free from recognized hazards that are likely to cause death or serious harm to his employees. He notes that citations for COVID-19 exposure will rely on guidance the employer did not meet, including OSHA’s.

Both OSHA and the CDC recommend employers adopt exposure control plans. (see post for more detail)

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com

Coronavirus, Workers’ Compensation and legislative updates

Like everything else the pandemic touches, the regulatory and legislative actions related to COVID-19 are a work in progress and continue to evolve.

Workers’ Compensation

Presumptive coverage

Governors and state legislatures grappling with how best to protect employees, while balancing the interests of businesses, continue to look to emergency adjustments to the workers’ compensation system to deal with COVID-19. The dominant issue is providing presumption of coverage for COVID-19 so that first responders and health care workers and, in some cases, other essential workers, have unimpeded access to workers’ compensation benefits.

Legislation is pending or has passed in several states, but the laws vary significantly. In some states, the presumption is conclusive, scrapping the basic tenet of workers’ comp that employees must prove they were exposed to the virus during the course of their employment. But in others, the presumption is rebuttable. The trend, which dramatically alters the workers’ comp landscape, is so prevalent that the National Council on Compensation Insurance, (NCCI) tracks this information.

States implementing changes include Alaska, Arkansas, California, Florida, Kentucky, Michigan, Minnesota, Missouri, New Hampshire, New Mexico, North Dakota, Utah, Washington, Wisconsin, and Wyoming. States with legislation pending include Illinois, Louisiana, Massachusetts, New Jersey, New York, North Carolina, Ohio, Pennsylvania, South Carolina, and Vermont. Updated status can be found here.

Not surprisingly, the action with the broadest sweep came from California. On May 6, Governor Gavin Newsom issued an Executive Order making it easier for employees to prove that they contracted COVID-19 at work and thus, get workers’ compensation benefits. While the presumption can be disputed if there is evidence the disease was contracted outside of work, the order effectively makes workers’ comp coverage available to all employees who worked outside their homes from March 19 to July 5 and contracted COVID-19 within two weeks of performing on-the-job duties. It is expected to cost between $600 million on the low end and $2 billion if higher estimates come to fruition, according to the WCIRB.

In Illinois, a significant court challenge compelled the Workers’ Compensation Commission to withdraw a sweeping emergency amendment that would have created a rebuttable presumption that when medical personnel, first responders, and essential employees contracted COVID-19, it was work-related. Both houses of the General Assembly recently passed a more limited bill that was a compromise measure that both businesses and workers’ advocates could live with. It provides death benefits for first responders who were presumably infected with COVID-19 on duty between March 9, 2020 and December 31, 2020 and worker’s compensation benefits for essential workers under certain conditions, but gives businesses a path to rebuttal.

The term “COVID-19 first responder or front-line worker” is defined in the bill as “all individuals employed as police, fire personnel, emergency medical technicians, or paramedics; all individuals employed and considered as first responders; all workers for health care providers, including nursing homes and rehabilitation facilities and home care workers, correction officers, and any individuals employed by essential businesses and operations as defined in Executive Order 2020-10 dated March 20, 2020, as long as individuals employed by essential businesses and operations are required by their employment to encounter members of the general public or to work in employment locations of more than 15 employees. For purposes of this subsection only, an employee’s home or place of residence is not a place of employment, except for home care workers.” Further, COVID-19 claims will not count against employers’ experience modification and premiums.

Employers can rebut claims under certain conditions if they can demonstrate the workplace was following current public health guidelines for two weeks before the employee claims to have contracted the virus; can provide proof that the employee was exposed by another source outside of the workplace; or, the employee was working from home for at least 14 days before the injury claim. Documentation will be critical to support rebuttals. The bill is expected to be signed by the Governor.

Employers and insurers are concerned that these presumption policies will increase insurance costs for employers at a time when businesses are already facing significant financial challenges. In Minnesota, the Senate recently passed a bill which creates a coronavirus relief fund with stipulations that such funds will help local government organizations cover workers’ compensation costs related to COVID-19, among other needs generated by the pandemic.

While few states have extended presumption beyond health care workers and first responders, some have issued warnings about the handling of COVID-19 claims. Recently, the Industrial Commission of Arizona issued a policy statement noting “claim denials related to COVID-19, like any claim denial, must be ‘well-grounded in fact’ and ‘warranted by existing law'” or based upon a good faith argument for the extension, modification, or reversal of existing law.

NCCI: Impact of claims on Experience Mod

In mid-May, NCCI posted Item E-1407 which excludes all COVID-19 claims from Experience Mods. In the early days of the crisis, new claim codes were created specifically for COVID-19 infections that were paid under workers’ compensation. This filing serves to exclude those claims from experience rating (and merit rating). This applies to claims with accident dates of December 1, 2019 and later and there is currently no expiration date for this rule.

This rule has been approved by Arizona, Arkansas, Colorado, Connecticut, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kentucky, Maine, Maryland, Mississippi, Montana, Nevada, New Hampshire, New Mexico, Oklahoma, South Dakota, Tennessee, Vermont, and West Virginia. Other states are expected to follow suit.

 

Independent states

Pennsylvania

In early May, the Pennsylvania Comp Bureau posted the rules relating to COVID-19, effective 3/1/20 to 12/31/20.

These changes allow for:

  • Temporary reclassification to 953 (Clerical) for employees who are now doing clerical work at home during the crisis.
  • Exclusion of payroll for wages paid to employees who are performing no services to the employer. This payroll will be assigned to Code 1212.
  • Exclusion of COVID-19 claims from Experience Rating.

There was a filing to make changes to the Basic Manual as well as the Statistical Plan.

Delaware

Also in May, Delaware made changes identical to Pennsylvania, effective April 1, 2020.

New York

New York has approved new rules, which differ from other states. According to RC 2512, published 5/1, payroll for employees who are not working at all OR employees who are temporarily reassigned to work at home will have their payroll assigned to the new code 8873. 8873 will carry the same rate as 8810. This means that employees who are being paid to not work WILL have premium applied to them, albeit at the very low 8810 rate.This rule is retroactive to 3/16/20 and applies for 30 days following the lifting of the Stay at Home order.The filing also excludes COVID-19 claims from any future experience rating.

Massachusetts

The Massachusetts Rating Bureau released a statement, “For the time being, we are interpreting Rule V.G. 6 to apply to the COV-19 situation. It states that employees who are not on strike, but are unable to perform their normal duties because of a strike, and they are performing absolutely no work for their employer and are not present on their employer’s premises during this period, such wages shall be assigned to Code 8810 – Clerical Office Employees NOC, provided the facts are clearly disclosed by the employer’s records.”

Minnesota

In Minnesota, the bureau has adopted NCCI’s payroll rules, but has stated that COVID claims WILL BE included on the experience mod.

Michigan

Unlike most states, the Michigan bureau (CAOM) does not file rules on behalf of carriers operating there. The carriers have the option to adopt or not adopt anything. CAOM has approved NCCI’s payroll rules for the Assigned Risk market, but individual carriers will have the option whether to follow this or not.

For Cutting-Edge Strategies on Managing Risks and Slashing Insurance Costs visit www.StopBeingFrustrated.com