Mary W, 43, an RN on a medical-surgical unit for more than 10 years, was assisting with readjusting a patient with severe obesity in bed and felt a twinge in her back. As the day progressed, her back bothered her more and more, but she did not think much about it as it was her fifth day of work in a row, and she was tired. The next day, she had difficulty getting out of bed, and was unable to stand up straight or lift anything over two pounds without severe pain. She was concerned that she had injured her back the day before, and it was more than just a little strain. She went to her primary care provider. They gave her an anti-inflammatory, instructions to rest her back and apply ice or heat as needed, and told her not to return to work for a week. Mary was instructed to return to see them if her symptoms did not improve in that time. In a week, the pain was not greatly better, and she still felt that she was unable to work.
The PCP asked if her employer provided workers’ compensation, but Mary did not know. They lived in a state that did not require that of her employer, so Mary’s PCP encouraged her to determine whether her employer provided coverage as she was going to need to utilize that resource given the difficulty she was having. She went to her employer after doing some research on her own to determine what workers’ compensation is and how the system worked. In the meantime, her PCP gave her a prescription for physical therapy treatments and suggested that she remain out of work.
Workers’ compensation, which was called workmen’s compensation until the name was changed to make it gender-neutral, is a form of accident insurance. It is paid by employers, with no payroll deductions taken out of employees’ earnings for this benefit. It provides coverage for medical expenses to employees injured in the course of employment. This includes those that acquire a work-related illness. If unable to work, workers’ compensation coverage will also pay for lost wages until the employee is able to work again. It is also designed to provide benefits to employees’ dependents if the employee dies as a result of a job-related incident or injury (US Department of Labor, n.d.c). The other side of this benefit is the mandatory agreement by the worker that they may not sue their employer for damages related to negligence if the employee believes that caused the injury. This agreement is known as “the compensation bargain” which prevents employers from going bankrupt due to high-damage awards, through which juries awarded incredibly high amounts of money to the injured.
Workers’ compensation insurance is a necessary safeguard for people in the workforce today. It is designed to protect employees from risking their health, safety, and assets for their jobs. The history of workers’ compensation provides some insight into how this system works and how it protects workers. When workers were forced to sue for compensation, many lost all they had in legal fees, with the risk of no settlement in the employee’s favor.
There are cases on record of employees who sued their employer and ended up bankrupt because of their injury and the cost of the lawsuit. There were three legal frameworks that employers used that were successful at winning these lawsuits. One was contributory negligence, meaning that if the worker was at least partially responsible for their own injury, such as slipping and falling, the employer could not be considered liable. A second method was for the employer to allege that a fellow workman caused the injury to occur, and again the employee would get nothing. A third method was the doctrine of assumption of risk. This doctrine holds that employees accepted the hazards of their work when they signed their initial employment contracts. Some companies even required new employees to sign a contract stating that they would not sue if they were injured in the course of their work. These death contracts are reported to be the stimulus causing Otto von Bismark to champion workers’ accident insurance (Boggs, 2015).
When the workers’ compensation statutes were developed, they protected the workers but also provided protection to the employers, as they could no longer be sued for increased damages over what was awarded for the injury. Statutes also included a provision for dependents of those workers who were killed in work-related accidents or illnesses. Other portions of the law protected employers and fellow workers by limiting the amount an injured employee can recover from an accident and the liability of other co-workers in most accidents (Boggs, 2015).
The first workman’s compensation law appears to have been established in 2050 BC in present-day Iraq. This law outlined compensation for injury to a worker’s specific body parts. Ancient Roman, Greek, and Chinese laws followed. Several versions of these laws existed over the years in different countries throughout the rest of history (Guyton, 1999). The United States version of workers’ compensation was fashioned after the one in Germany begun by Otto von Bismark in 1881 (Boggs, 2015). Wisconsin was the first state to enact a workers’ compensation law in 1911, with Mississippi becoming the final state to do so in 1948 (Guyton, 1999).
Workers’ compensation is compulsory for all employers in most states, depending on the type of organization it is. An exception, Texas changed its law in 2018, allowing employers to opt-out of the mandatory requirement. Employers in that state still have the option of purchasing insurance voluntarily. Other states have considered this type of “opt-out” legislation but have not passed or enacted any others yet (Kersey, 2017). States with compulsory insurance required of employers have differing regulations regarding which employers must, and which are exempted from, buying into the program. The US Department of Labor (n.d.b) offers information for state workers’ compensation programs through their website. Another useful website is the State and Local Government on the Net website. This website has links to every state’s workers’ compensation organizations, briefly describing who must provide workers’ compensation in that particular state (State and Local Government on the Net [SLGN], n.d.).
State Workers’ Compensation
The state workers’ compensation insurance is considered a statutory coverage because the benefits are established by state laws, also known as statutory laws. Therefore, the covered benefits and benefit levels differ from state to state. However, all states have some things in common. In general, each provides coverage for medical bills and lost wages for workers who are injured on the job regardless of where the fault for the injury lies, if any. For this to occur, the employees give up their rights to sue an employer if they believe the employer is at fault. As stated before, this compensation was intended to reduce the legal wrangling that occurred between workers and employers and assure that workers would get timely and adequate medical care without having to fight each step of the way to receive that care (SLGN, n.d.).
There are instances where employees will hire lawyers and sue to ensure that the benefits provided are correct. Each state, therefore, has a department or division to handle the workers’ compensation program, with an adjudicator (or judge) who will determine the amount of the benefit to be awarded to the employee from the common fund. When an injury or accident occurs, the employer notifies the state workers’ compensation board or their insurance company, who will do so, depending on the way the statutes are written in that state. The employee, in most states, must file a claim. This differs from state to state, and the employer should provide information to the employee about what they are to do. Because each state sets its own statutes, it is imperative that people understand whether workers’ compensation is provided for them, and what the procedures are for accessing that insurance. If the need to utilize the coverage arises, this will reduce any potential delays in getting the process started (SLGN, n.d.).
Each state sets up its method of funding differently. Some require that employers purchase from a private insurance company or buy into the state-funded group insurance plan. Some states allow employers to self-fund, although in those states, employers must prove they have the funds to cover that self-insurance. According to a report by the federal government, private insurers covered 58.6% of claims, state funds paid for 15.7%, and self-insured plans paid for 25.7% of workers’ compensation claims in 2014 (Congressional Research Service, 2017).
Federal Workers’ Compensation
The Department of Labor’s Office of Workers’ Compensation Programs (OWCP) administers four major disability compensation programs that aid federal workers and/or their dependents. These programs include:
- The Energy Employees Occupational Illness Compensation Program
- The Federal Employees Compensation Program
- The Longshore and Harbor Workers’ Compensation Program
- The Black Lung Benefits Program
This assistance is provided when an injury occurs at work or an illness is contracted because of the occupation and includes such things as wage replacement, medical treatment, and vocational rehabilitation, among other benefits. Some specific groups are covered by specific entities under the auspices of the OWCP (US Department of Labor, n.d.a, n.d.c). Within the OWCP, the specific department that handles workers’ compensation is the Division of Federal Employees’ Compensation (DFEC). The OWCP website directs federal employees regarding how to initiate a workers’ compensation claim. One significant difference between state and federal workers’ compensation benefits is that in the federal system, benefits can be withheld if a determination is made that the injury was the employees’ fault; this is not true in the state workers’ compensation statutes. The Federal Employees Compensation Act (FECA) has other differences as well, many due to the scope of those who are covered and the differences among them. For instance, all civilians employed by the federal government are covered. Both full-time and part-time employees are covered, as are many volunteers (Job Corps, for instance) or those serving on federal juries (Congressional Research Service, 2017).
The steps to receiving compensation in the federal system are different than in the state system; the employee must be given the tools to access that system when needed as they are much more involved and onerous for the employee than do the state statutes. FECA can be read in full by federal employees wishing to fully understand how and when benefits are provided, to whom, and all of the restrictions associated with workers’ compensation claims within the federal system (Congressional Research Service, 2017).
The administration of these funds is managed by each individual department, as there is not a third-party administrator involved in the adjudication process. FECA is described within the act as a self-insurance fund, covered entirely by the federal government, with no insurance companies or other third-party payers involved. Each department sends a budget for this fund along with its other annual budget requests to Congress each year. FECA contains very specific percentage amounts of salaries, which are to be calculated by the departments in order to determine how much money should be allocated for each employee when submitting their budget requests (Congressional Research Service, 2017)..
Importance of Workers’ Compensation Acts to Healthcare Workers
Many patients within the healthcare industry are currently or will be treated under some form of workers’ compensation insurance, and nurses must therefore educate themselves in order to better help our patients. We will continue to serve as patient educators and advocates, regardless of coverage, and will need this information in order to fulfill those roles effectively. However, it is also prudent that healthcare workers have an awareness of what will be available to them should they be injured on the job. A 2018 study by the Bureau of Labor Statistics reported that RNs experienced more work-related injuries in 2016 than did employees working for construction companies. This underscores the importance of healthcare workers being knowledgeable about the workers’ compensation system. The work that healthcare workers carry out is indispensable in our society; the physical nature of that work and potential for associated injuries necessitates being well-informed.
Mary W. called her hospital’s Human Resources office and explained her situation. She was referred to the institution’s officer tasked with managing workers’ compensation issues. This officer assisted Mary as she worked through the process and learned what was required, in her state, to be able to get her rehabilitation treatments covered. In addition, Mary discovered that she was eligible for assistance with lost wages to cover household expenses, which Mary needed as she was the primary provider for her family. The ultimate goal for Mary and her treatment team was for Mary to be able to return to work safely and quickly.
Boggs, C. J. (2015). Workers’ compensation history: The great tradeoff. Insurance Journal Retrieved from https://www.insurancejournal.com/blogs/academy-journal/2015/03/19/360273.htm
Bureau of Labor Statistics. (2018). Occupational injuries and illnesses among registered nurses in 2016. Retrieved from https://www.bls.gov/opug/mlr/2018/article/occupational-injuries-illnesses-among-registered-nurses.htm.
Congressional Research Service (2017). Federal Employees Compensation Act. Retrieved from https://fas.org/sgp/crs/misc/R42107.pdf
Guyton, G. (1999). A brief history of workers’ compensation. The Iowa Orthopaedic Journal, 19, 106-110. Retrieved from https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1888620/.N
Kersey, L. (2017). Alternative workers’ compensation mechanisms- What’s happening with opt-out? Retrieved from www.ncci.com/articles/pages/II_insights_opt-out.aspx
State and Local Government on the Net. (n.d.). State workers’ compensation sites. Retrieved December 2019 from http://www.statelocalgov.net/50states-workers-compensation.cfm
US Department of Labor (n.d.a) Federal Employees Compensation Act. Retrieved December 2019 from https://www.dol.gov/owcp/dfec/regs/statutes/feca.htm
US Department of Labor (n.d.b) State workers’ compensation officials. Retrieved December 2019 from https://www.dol.gov/owcp/dfec/regs/compliance/wc.htm
US Department of Labor. (n.d.c). Workers’ compensation. Retrieved December 2019 from https://www.dol.gov/general/topic/disability/workerscompensation