Impacts of COVID-19 on Workers’ Compensation
Ohio employers are forced to handle a multitude of unprecedented challenges arising from the COVID-19 pandemic. With regard to the issue of workers’ compensation, Ohio employers should be aware of several proposed and enacted changes that will affect claims handling, and determine whether or not claims arising from exposure to COVID-19 are compensable. With that in mind, there are a variety of risk management best practices to be cognizant of as Ohio employers attempt to navigate these uncertain times.
Procedural and Legal Changes
In an attempt to ease the economic impact of the pandemic in Ohio, Governor DeWine requested the Bureau of Workers’ Compensation, and the BWC Board approved, a return of $1.6 billion to Ohio employers. Moreover, Ohio employers have the option to defer, with no application necessary, workers’ compensation premium payments for the months of March, April and May until June. Injured workers’ benefits will continue through at least April 30, 2020 regardless of whether the worker is able to submit to an Independent Medical Examination, have a physician complete a Medco-14 work ability form, or actively participate in job searches.
While the Bureau of Workers’ Compensation remains operational during the pandemic, several policies and procedures have been put in place to allow it to function in accordance with social distancing and shelter at home protocols. Industrial Commission hearings are being conducted by phone, but only on limited matters. Physician file reviews are being used over in-person IME where possible, and the option of virtual examinations is being explored. The Bureau has also suspended all face-to-face employer audits.
Compensability of COVID-19 Exposure Claims
When it comes to the issue of workers’ compensation, the biggest question facing employers as they try to plan for the impacts of the pandemic is, whether or not COVID-19 claims are compensable. Generally, communicable diseases are not compensable under workers’ compensation law as the following three elements must be demonstrated to establish a compensable “occupational disease”:
- The disease was contracted in the course of their employment;
- The disease is peculiar to the claimant’s employment by its causes and characteristics of its manifestation, or the conditions of the employment result in a hazard which distinguishes the employment from employment generally; and
- The employment creates a risk of contracting the disease in a greater degree and in a different manner than employment generally.
Given the present circumstances, it appears an employee would be hard pressed to conclusively establish that, more likely than not, they contracted COVID-19 at work. Even assuming a claimant could do so, they would still need to establish that their employment placed them at increased risk in comparison to the general working public. Outside of certain limited fields, this too would be a significant hurdle for a claimant.
In fact, when these elements have been applied to claims involving other communicable diseases in the past, courts have concluded they were not compensable and have pointed to the slippery slope that would be created if they were to be deemed otherwise. In one instance the Ohio Supreme Court opined,
“…if the term injury is to be construed to include typhoid fever contracted in the course of employment, it may as well include influenza, pneumonia, tuberculosis, smallpox, ordinary colds, rheumatism, and practically every disease which may be contracted by workmen in the course of employment, and the workmen’s compensation department will become a health and life insurance department for workmen, compulsorily supported by employers…”
However, several pieces of legislation have been introduced into the Ohio House of Representatives which would seemingly make it easier for employees to file claims for COVID-19. For instance, Ohio House Bill 573 proposes the creation of a rebuttable presumption that COVID-19 was contracted in the course of and arising out of employment for any employee who was required to work outside of their home following Governor DeWine’s March 9, 2020 emergency declaration. Such a presumption essentially negates the second two elements of a typical occupational disease claim and shifts the burden to the employer to prove that the employee’s exposure to the virus did not occur within the course and scope of employment. This presumption would apply only to claims arising during the declared state of emergency and the fourteen-day period thereafter.
Similarly, House Bills 571 and 605, propose the same rebuttable presumption, but are limited respectively to first responders/emergency medical workers and food service workers.
At first glance these proposals appear reasonable and tailored. However, we are well aware of the potential for this disease to cause critical illness resulting in extended stays in the intensive care unit and death. Moreover, we are only beginning to understand some of the longer term consequences of the disease, including reports of lasting cardiovascular and neurological damage. Even with the limited scope of these bills, the serious and potentially long term nature of COVID-19 claims could result in overwhelming costs. While no votes have been taken on any of these bills, and even if passed in the House, the bills would require Senate approval and the Governor’s signature, several other states have already enacted similar laws.
Other Actuarial Considerations
By all indications employers should be anticipating an increase in claims costs. Given the sheer number of people who (as is forecasted) will become infected and the difficult economic circumstances created by the pandemic, a sizable number of COVID-19 claims must be anticipated. Combined with the critical illness and fatality associated with COVID-19, this will correlate to exceptionally high claims costs. Increased legal and litigation expenses are another projected consequence as employers will seek legal opinions with regard to risk management, when deciding whether to accept or deny claims, and in order to test what is and is not compensable at the industrial commission and in the courts.
There are also a variety of tertiary elements that will impact the total number of claims and claims costs. Furloughs, workforce reductions and work from home policies have the potential to reduce the number of non-COVID-19 claims. However, these circumstances also pose a risk for fraudulent claims. Unfortunately, impending furloughs or workforce reductions can be seen as an opportunity for some to make a false workers’ compensation claim. Employers must also be mindful of the fact that their employees are subject to workers’ compensation when they are working from home. Generally speaking, it would be a compensable injury if an employee is injured at their home while acting for the benefit of their employer. The lack of witnesses and the difficulty in investigating such claims creates a greater potential for fraud. The challenges associated with investigating at home work related injuries also translates to increased claims costs due to the need for specialty investigations.
Regardless of the type of claim, costs will also increase as a result of longer claim durations. The Industrial Commission and the Courts are operating on a limited basis with many deadlines being continued thereby delaying the claims handling process. There is also the matter of limited access to the medical system delaying the treatment and evaluation of claimants. While this can be mitigated to a certain degree by way of virtual medical visits, the bulk of workers’ compensation claims involve orthopedic injuries that require imaging, objective testing, physical therapy, and elective surgery. Access to these in person diagnostics and treatments are limited and in many cases suspended. Once again, creating significant delays in the progress of workers’ compensation claims.
Considering the vast breadth of the pandemic and the efforts to contain it, as well as the developing projections of additional waves of the virus, its impacts are far reaching, and in many cases, likely still yet to be seen.
Risk Management and Claim Prevention
Certainly the most effective way to reduce the risks and costs of the direct and indirect COVID-19 workers’ compensation impacts is to prevent claims. The level of defenses an employer needs to take is dependent on the level of risk inherent in the particular industry and work environment. Consider the number of employees, the frequency with which employees come in contact with others, and the proximity of the contact. Taking into consideration the potential risks, employers should take all possible precautions to minimize employee exposure by way of administrative and engineering controls.
Administrative controls are policies and procedures that employers can put into place that function to both minimize risk and establish corporate culture. They are the first line of defense when facing the hazards posed by the COVID-19 pandemic. Examples of administrative controls include:
- Employee screening
- Temperature checks
- Experiencing symptoms
- Caring for someone who is ill
- Travel history
- Abiding by social distancing
- Establishing hygiene standards, including promoting frequent and thorough hand washing
- Encouraging employees to stay home if they are sick
- Allowing employees to work from home
- Altering and staggering work and break times
- Limiting the number of non-employees coming into the workplace
- Treating requests from employees with heightened vulnerability as a request for any other reasonable accommodation
These controls demonstrate to employees that an employer is taking the risk seriously and has their health and welfare in mind. In turn, employees are more cognizant of the risks and take necessary precautions as well.
Engineering controls are the physical changes to the work environment employers can implement in order to mitigate the risk of employee exposure. Examples of administrative controls include:
- Providing hand sanitizer containing at least 60 percent alcohol
- Routine cleaning and disinfecting
- Increase frequency of cleaning
- Alter cleaning schedule so that cleaning is visible to employees
- Providing employees with disposable wipes for commonly used surfaces
- Physical barriers
- Closing of common areas or reducing/separating seating and tables
- Altering processes to comply with social distancing
- Increased ventilation
- Isolation areas for the ill
- Providing masks or other personal protective equipment
Additional resources and materials on this subject can be located at the CDC Resources for Business and Employers. It should be noted that potential consequences with regard to employment injury and employee rights need to be taken into consideration when implementing various controls. For example, changing a manufacturing process to distance employees could result in an increased ergonomic exposure or over exertion. There is also the potential for employees to be moved too far from emergency stop buttons or positioned in a way that safety guards are not effective. Furthermore, attention must be given to employee privacy when performing symptom screening and interviews. Implementing some of these measures are far easier than others and can require significant planning and preparation.
Please contact us at email@example.com if you have any questions about COVID-19 impacts on workers’ compensation or any other COVID-19 legal issues.