The Uninsured: Up Close and Personal

Our colleague Joe Paduda has done a great job of blogging the problem of the millions of Americans who lack health insurance. Over the past week, he has blogged good and not-so-good articles relating to this national crisis. The problem has many ramifications, one of which, Joe points out in today's blog, should be a business opportunity for health insurers who are looking for new markets. Unfortunately, insurers don't seem very focused on the issue.

We have blogged this problem a number of times ourselves, with particular reference to the implications for workers compensation. It's relatively simple: people who work might not have health insurance, but they do have a disability policy for work related injuries (workers compensation) that provides indemnity payments and full medical coverage, with no copays, no deductibles and no time limits. In order to be eligible for these benefits, they have to prove that their condition is work related.

Real Life Problem
Last week the problem of no health insurance came home as we sat down with an artisan contractor who had a problem with one of his employees. This valued worker has a pre-existing back problem, recently exacerbated by a bike riding accident on the weekend. The employer, a thoughtful and considerate man, placed the employee on light duty, which has continued for three weeks. The employee is loyal and reliable; he presents his physical problems as being unrelated to his job. Given his diminishing physical capacities, the employee is questioning whether he can do this type of work (painting) much longer.

LynchRyan, a claims adjuster and the employer met to review the situation. We agreed that it would be best to secure up-to-date medical information on the employee's condition. How serious is it? What are his restrictions and how long are they likely to continue? At first we thought we should refer the employee to an occupational doctor for a "fitness for duty exam." This would give us a line on current restrictions and a timeframe for returning to regular duty. The employer was willing to pay for this exam.

Here's where the absence of medical insurance came into play. What if the doctor wants to run some more tests? What if an MRI is needed? Who pays for that? At this point, this is not a work-related condition. It is not covered by workers compensation -- indeed, the employer is motivated to keep the situation off of his comp loss run.

After considering all the options, we came up with the following approach:
First, the employer will have an informal conversation with his employee as soon as possible, letting him know that the light duty cannot continue indefinitely. He will explore the employee's latest thinking about a change in career. If the employee is ready to move onto a different kind of work, the employer will provide a month’s severance and a letter of recommendation.

On the other hand, if the employee wants to continue painting, the owner will set up a physical exam at an occupational clinic, to determine whether the employee is capable of performing the essential functions of the job. If the physical indicates that further treatment or diagnostic testing is needed, or that the employee should probably give up painting, the employer will be confronted with a number of problemmatic decisions that will require consultation with a labor attorney. Given his own narrowing options, and despite his appreciation for his employer, the employee may feel compelled to seek the advice of an attorney and even to file a comp claim. The conundrum, pure and simple, is the lack of any medical insurance outside of the comp system.

Ironically, the employer wants to provide health insurance coverage for all of his employees, but he has to wait until his workers comp experience mod comes down. His premiums were inflated by a large back claim for an injury that was probably not work related. His insurance premiums are cutting deeply into available resources, so he cannot afford to provide his crew the relatively expensive benefit of health insurance.

Staying Power
The issue of health insurance is not going away any time soon. As Joe Paduda points out, it impacts the health and well-being of millions of American workers. It is probably no coincidence that in Texas, where over 30% of the workforce lacks health insurance, the cost for workers comp is very high, second only to California. The cross-over issues between health coverage and workers comp are wide-ranging and complex, as our little case study of just one well-intentioned employer makes abundantly clear.