On Friday, the Oklahoma Workers' Compensation Commission called the alternative workplace-benefit plans that some employers adopted under the law "a water mirage on the highway that disappears upon closer inspection," and ruled unanimously the law that allows employers to opt-out of state-regulated workers' comp plans. The commission order said, "A closer look at the statutorily authorized plan requirements reveals that the benefit plans permitted to be used to opt-out establish a dual system under which injured workers are not treated equally."
The ruling is expected to be appealed but the U.S. Department of Labor is looking at whether opt-out plans in Oklahoma and Texas violate federal laws.
PartnerSource, which bills itself an 'alternative to Worker's Comp' and does double duty helping draft laws allowing companies to opt out of state workers' comp plans, has two plans - the Texas Nonsubscriber Option and the Oklahoma Option. Both options promise lower costs and no state regulatory expenses. According to PartnerSource president Bill Minick, his plans save employers up to 90 percent in claims costs.
Several states have similar provisions that give employers to set up their own work place injury plans as an alternative to state-regulated benefit plans. These alternative plans frequently provide fewer benefits, make it easier for employers to deny benefits, give employers control over medical assessment and treatment, leave appeals in the hands of employers, and force workers to accept lump-sum settlements.
But in a NPR's ongoing investigation 'Insult To Injury: America's Vanishing Worker Protections' says the opt-out plans let employers pick and choose what workplace illness and/or injuries they cover. For example, the Texas plan only covers injured workers for two years, won't cover exposure to hazardous materials such as asbestos and silica dust, and authorize only a fraction of settlements for catastrophic injuries and deaths.
The ruling "stops opt-out in its tracks," says Bob Burke, an Oklahoma City attorney who has filed 17 cases challenging the law. "This decision assures that all Oklahoma men and women who are injured on the job are treated equally and will be allowed to tell their story to a judge," Burke said in a statement. "The opt-out plans put all power in the hands of the employer, with no independent review ever of the employer's decision. The employer under such a plan decides what constitutes an injury, has total control over the doctor and hospital that an injured worker goes to and can force a settlement at the end of the case. If the worker does not accept the settlement, all benefits are terminated."