If you're a State of Oklahoma employee, you may have received information from your agency or division during the past couple of years regarding the switch from a private workers' compensation insurer to a state pool designed to cover around 37,000 employees. Since 2014, this enacted bill has permitted state agencies to cancel their private workers' comp policies or allow them to lapse and, instead, take part in a "self-insurance" program called the Consolidated Workers' Compensation Program (CWCP). However, this program has recently come under fire and even been described as unconstitutional, drawing a civil lawsuit from a group of workers' compensation attorneys who argue that this law is unfairly burdening taxpayers and harming workers' comp plaintiffs. Read on to learn more about how this lawsuit could change how workers' comp claims are handled for state employees in Oklahoma, as well as what the outcome of this lawsuit could mean for your own workers' comp claim.
What aspects of Oklahoma's state employee self-insurance plan are being challenged in court?
Since the creation of the CWCP, many covered state agencies have opted to purchase policies with ultra-high deductibles in order to save money. As with most other types of insurance, the higher the deductible, the lower the premium -- and because the CWCP premium is paid from the funds specifically allocated to the agency, while the deductible is paid from Oklahoma's general fund, choosing a high deductible can save a state agency a significant amount of money. This cost savings can exist even if the state agency at issue has a higher-than-average number of workers' comp claims due to negligent management or hazardous work.
The money used to pay these higher deductibles isn't free, however, and years with a large number of state employee workers' comp claims could wind up siphoning money from other programs paid through the state's general fund. Alternatively, these claims may simply go unfunded, with injured employees forced to litigate in court to recover workers' comp benefits to which they're entitled.
Arguing that this shifting of workers' comp deductible costs onto the taxpayer is unconstitutional and places injured employees in danger of not having their claims paid, a group of workers' comp attorneys has banded together to file a civil lawsuit against the state. Specifically, these attorneys allege that the state's failure to include a loss guarantee provision in its self-insurance plan essentially renders it an unlicensed insurance company, operating outside the bounds of the law and the Oklahoma Constitution.
How could the outcome of this case affect your pending workers' comp claim?
If your workers' comp claim is pending alongside this lawsuit, the verdict reached could potentially impact your own claim. If the state's high court agrees with the plaintiff attorneys that the absence of a guarantee of all losses makes the state's plan unconstitutional, it may order that the state amend the terms of the plan to render it less vulnerable to economic fluctuations while paying up to $42 million in damages. This could benefit you as a workers' compensation plaintiff, as the terms of your new plan will likely be retroactive due to the court's determination that the current plan is unconstitutional. This new plan can provide you with some additional protections not currently available, like guaranteeing coverage of all directly-related workers' comp costs (like lost wages and medical bills).
If the court determines that the statute is constitutional, you could find yourself in trouble if your workers' comp claim hits during a downturn for your employer. If your employer hasn't met its workers' comp deductible for the year and budgeted dollars are tight, you may wind up in the middle of a "who pays?" battle between the state general fund and your employer. In the meantime, you may be racking up medical bills and having trouble keeping up on your normal obligations with the sudden drop in income. You may want to consult a workers' compensation lawyer to ensure that your rights are preserved throughout the workers' comp process.