By Tom Ryan, Managing Director and Market Research Leader for Marsh’s Workers’ Compensation Center of Excellence
Nationally, the legal landscape for recreational and medical use of marijuana continues to evolve. Twenty-three states and Washington, DC, now allow for comprehensive medical marijuana programs. Recreational marijuana use, meanwhile, is legal in Alaska, Colorado, Washington state, Washington, DC, and Portland, Maine. For employers, this has highlighted the difficulty of preventing marijuana use in the workplace and raised the possibility that an employer will be required to pay for medical marijuana as treatment for a workers’ compensation injury.
Medical Marijuana in Workers’ Compensation
For employers, medical marijuana presents two workers’ compensation-related concerns: Compensability of a claim for an injury that involves marijuana and use of the drug as a form of medical treatment.
In most states, an employer can use an “intoxication defense” for a claim of workplace injury if an employee is drunk or high. But in some states, an employer must prove that intoxication or impairment was the sole cause of an injury. That’s a difficult standard to meet; if, for example, a wet or damaged floor or any other factor contributes to the injury, the intoxication defense could be invalidated. This may be true even if company policy bans the use of marijuana, alcohol, or another substance — meaning, potentially, that an employer could fire an employee for failing a drug test, but still have to pay his workers’ compensation claim.
The research on marijuana’s medicinal value is inconclusive. The Food and Drug Administration has not conducted any clinical trials on marijuana, nor has it approved its use as a form of medical treatment. In addition, no large-scale, randomized, and controlled human trials have been conducted that sufficiently ease the concerns about the inherent risks of marijuana use. Still, some state courts have ruled that marijuana is an acceptable form of treatment for a workers’ compensation injury.
It’s unlikely that claims for medical marijuana will be submitted through the traditional pharmacy benefit manager (PBM) process; claimants may instead be required to pay for medical marijuana out of pocket and submit a claim for reimbursement. So it’s advisable that employers, third-party administrators, and insurers have a medical marijuana strategy in place.
Your organization’s claims handling instructions should now include a marijuana-specific directive or communication protocol to follow. This protocol should require immediate discussions between the employer and adjuster following any request for reimbursement for medical marijuana or written verifiable recommendation for medical marijuana from a physician or medical provider.
More Positive Drug Tests
As the sale of marijuana is legalized in more jurisdictions, drug use appears to be on the rise. According to the most recent Quest Diagnostics Drug Testing Index, the positivity rate for urine drug tests in the US workforce increased from 4.3% in 2013 to 4.7% in 2014. Marijuana positivity increased from 2.1% in 2013 to 2.4% in 2014; the drug remains the most commonly detected illicit drug, representing approximately half of all positive tests.
These trends can be troubling for employers — especially those in industries with safety-sensitive positions like heavy manufacturing and transportation. According to the National Institute of Drug Abuse, substance-using employees are more likely to:
- Be involved in workplace accidents and potentially harm others.
- File workers’ compensation claims.
- Be tardy to or absent from work.
- Change jobs.
It’s no surprise then that many employers looking to create safer workplaces, comply with federal drug-free workplace laws, and reduce their insurance costs have introduced a zero-tolerance policy. Some employers that historically have not conducted employee drug testing are now exploring how to introduce such programs. And other employers are considering expanding their existing drug testing programs.
But this is easier said than done. Employers must deal with the growing complexity of workplace drug testing rules, requirements, and laws, and make difficult decisions about how to test their employees. For example, should employees be tested before they’re hired? After they’re hired, should all employees be tested randomly, when there is a reasonable basis for suspicion, or only after an accident or injury? And after an injury, what kind of follow-up testing is appropriate?
Employers should consult with their labor and employment counsel to ensure that drug testing policies are in compliance with all federal, state, and local laws and regulations
Despite the trend toward legalization, the legal landscape appears favorable — at least for the near future — for employers interested in maintaining drug-free workplaces. Employers seeking to prevent drug use in the workplace should talk to their claims advisors and insurance brokers when considering establishing zero tolerance policies and introducing or expanding drug testing policies.
About Tom Ryan
Thomas Ryan is a managing director and the Market Research Leader for Marsh’s Workers’ Compensation Center of Excellence. In this role, Tom oversees research and distribution of content on emerging issues, tracks federal and state regulatory changes and prevailing market conditions, and other topics related to the workers’ compensation environment. He also consults with clients and provides information and recommendations using Marsh’s holistic MPACT Workers’ Compensation strategy.
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