Using workers compensation systems to provide medical and indemnity benefits to workers who contract COVID-19 could be advantageous, according to a report by Rand Corp. released Tuesday.
“Assured benefits could encourage sick workers to stay at home, and workers compensation has long been recognized as an effective incentive for employers to proactively promote workplace safety by using insurance pricing to encourage safety investments,” researchers wrote.
States and insurers could also mitigate employer concerns about rising premiums by excluding COVID-19 claims from experience rating and, instead, using premium discounts or other incentives to encourage businesses to take steps to reduce transmission of the virus, according to the paper.
Researchers noted that many states expanded the ability of workers to receive benefits either through executive orders or legislation creating rebuttable presumptions.
“In the case of COVID-19, these rebuttable presumptions are particularly important given the community prevalence of the disease,” the report reads. “Because the disease is presumed to have arisen out of the course of employment, claimants face a lower bar to have their claims approved.”
Most jurisdictions adopted COVID-19 presumptions that take effect when a person tests positive or is diagnosed with the disease. In at least three states — Mississippi, North Dakota and Washington — the presumption is triggered when a worker is ordered to quarantine by an employer because of suspected COVID-19 exposure, according to the paper.
Researchers noted that payers are accepting COVID-19 claims from frontline workers in several states that have not adopted presumptions. Yet, most workers have limited options for replacing lost wages and covering medical expenses for treatment of COVID-19 outside of workers compensation systems, the researchers wrote.
“Expanding workers compensation to cover COVID-19 claims has several potential benefits for workers who might otherwise be left without recourse,” researchers wrote. “Many employers may fear losing their jobs if they need to take time off after becoming ill. Guaranteed coverage should, in theory, give workers incentives to stay home if they are sick, thus reducing the potential for continuing spread of the virus while offering compensation for lost wages and medical costs.”
This article was first published in Business Insurance.