4 things we’ve learned about COVID-19 & Texas Injury Benefit Programs
June 23, 2020
By Bill Minick, Chairman
Employers in and out of Texas workers’ comp handle COVID-19 injury claims similarly, and may have related liability exposures. But the pace of innovation and performance continues much faster in the Texas injury benefit program environment, led by companies that employ unsung heroes we finally recognize.
1. Injury Benefits Coverage is Similar to Workers’ Compensation. Most COVID-19 injury claims are denied by workers’ compensation systems and injury benefit plans, alike. Typically, there is no known, causal connection between the employee’s work environment and this communicable disease (or others, like the common cold or flu). But there are some differences.
Workers’ comp insurers approach COVID-19 from minimum-legal-compliance, “exclusive remedy” and cost-containment perspectives. On the other hand, Texas injury benefit programs approach COVID-19 with a view toward legal compliance, cost containment AND their fiduciary duty under the Employee Retirement Income Security Act (“ERISA”). As a result, we see many of these benefit programs pay for initial medical care, testing and even some wage replacement – taking a conservative, non-adversarial and customer service mindset to coverage issues – even when the claim must ultimately be denied for not meeting the “course and scope of employment” or other plan requirements.
Although this has been a fast-paced learning experience for all of us, Texas injury benefit program sponsors, claim administrators and insurers should now have a fairly good grasp on their COVID-19 claim coverages and procedures. Good guidance is available now in this 3/16/20 PartnerSource Client Update and 4/22/20 PartnerSource FAQ, as well as other pieces found in the ARAWC COVID-19 Series.
2. Negligence Liability Exposure is Real -- In and Out of Workers' Comp. COVID-19 is bringing a tsunami of litigation against employers. As of June 17, 2020, this study shows almost 3,000 complaints nationwide, including 191 in Texas, like this. But remember, a claim for medical and other benefits under a Texas injury benefit plan (which should be handled on a “no fault” basis to qualify for the QCARE designation) is not the same as a negligence liability claim (which seeks damages based on some fault of the employer). As stated in this excellent paper on nonsubscriber COVID-19 liability exposure, “a plaintiff would need to prove his or her employer breached a recognized duty and the plaintiff’s resulting damages were proximately caused by such breach.” We now know it will typically be very difficult for an employee to prove such fault.
Companies that subscribe to Texas workers’ compensation insurance may believe they are insulated from such liability litigation. After all, the “exclusive remedy” rule generally limits their responsibility to statutory benefit payments. But the workers’ comp system’s “Grand Bargain” will not support the simultaneous denial of benefits for an entire category of injury claims (like COVID-19) and complete negligence liability immunity against such claims. The potential for liability litigation against Texas employers inside and outside of workers' compensation is real and should be addressed by lawmakers at both state and federal levels. We’re not talking about “blanket immunity” or similar lawsuit prohibitions that remove all employer motivation to provide a safe workplace. Rather, reasonable liability limitations can recognize that we’re all human, and no one really saw COVID-19 coming. We should not leave this liability exposure hanging, for years, like a dark cloud, above the heads of employers, medical providers and others we are counting on to restart the amazing Texas economic engine that, for decades, has driven families to move here in droves.
3. Hyper-Regulated Systems Innovate More Slowly, in Good Times and Bad. Beginning in 2013, we saw local and national trial lawyers, insurance companies, regulators, and media join hands to keep other states from creating a competitive work injury marketplace, like the one found in Texas. Texas injury benefit programs survived those attacks because all objective research and data demonstrate we are delivering better medical outcomes and paying improved benefits to injured workers, while reducing taxpayer expense and saving billions of dollars for companies that create new jobs. Overall, workers’ comp system innovations over this same timeframe (since 2013) have been minimal. And for COVID-19, they continue to wrestle with current and newly complicated laws and regulations on medical care, provider networks, hearing procedures, premium rates, and the list goes on. For example, we now have at least six bulletins from the Texas Division of Workers’ Compensation on COVID-19 alone. This complexity has left many injured workers further bewildered and their recovery delayed.
On the other hand, substantial program improvements have been made in recent years to clarify the goals of Texas injury benefit programs, and establish credible program standards through the QCARE designation. Even in the midst of the COVID-19 crisis, Texas employers have expanded QCARE protections to hundreds of thousands more workers. Industry leaders are able to think fast, make decisions and press forward with delivering the medical care and benefits injured workers need in a time of crisis – without paralyzing reliance upon state or federal government permissions to do the right thing. And where further government rules have been needed (like new claim regulations from the U.S. Department of Labor suspending certain claim and appeal requirements for the COVID-19 pandemic), Texas injury benefit plans have responded.
The PartnerSource team of seasoned attorneys and claim professionals will continue to expeditiously identify, adopt and educate on best practices as the science around COVID-19 improves.
4. Unsung Heroes Recognized. In addition to police and other first responders that we highly appreciate, employees in the healthcare, food service, fuel, home improvement, retail, transportation, automotive and other industries that have taken care of us through the COVID-19 crisis are heroes. Their employers, most of whom sponsor a Texas injury benefit program, have been at the forefront of advancing employee advocacy, workplace safety, and mitigating the spread of COVID-19. Thank you for taking the risks to keep America well-fed, fairly productive and otherwise healthy. We’ve learned a profound sense of gratitude for these companies and important workers historically overlooked and under-appreciated. Thank you!