No April Fool’s Joke ― ACA to Federalize Work Comp

At first, when I read Joe Paduda’s post this morning on my smartphone, I thought it had to be some kind of April Fool’s joke.

But when I clicked on the links Joe provided in his article, I found out he wasn’t joking. His brilliant article, Obamacare exchanges to be used for work comp enrollment, caught me and a few commenters by surprise.

It caught me by surprise because back in the summer of 2011, I took an online elective course on the PPACA as part of my MHA degree program. The term paper I wrote, PPACA: The End of Workers’ Compensation?, mentioned that:

“In 1972, the National Commission on State Workmen’s Compensation Laws issued a report that took the position that it would be unwise and unnecessary for any national health insurance program to assume medical costs of workers’ compensation. The Commission stated that to fold workers’ compensation medical costs into a national health insurance program would be inconsistent with the central tenet of workers’ compensation and that the costs of work-related injuries and diseases should be allocated to the responsible source.”

I went on to write in my paper that in the 1990’s, the Clinton Administration favored the merging of the medical component of workers’ compensation into a federal health care system as part of their health reform proposals. The Administration backed off of this proposal after strong opposition from business owners who said it would not produce any real savings, would have pre-empted state “choice of provider” laws and empower employees to select providers from any federally approved health plan.

Yet, I found that any talk of federalizing workers’ compensation was speculative, since one bill introduced into the House of Representatives was stalled in committee, and when the PPACA was being drafted, the issue of workers’ compensation was not a minor focus of the legislation, and as I quoted:

“there is no language in the law that would directly and explicitly affect workers’ compensation. From the beginning of bill-drafting in both the House and Senate, it was clear that workers’ compensation was not an area that should get mixed into the reform process”.

Well, from reading Joe’s article this morning, it would seem that the Obama Administration has picked where the Clinton Administration left off, and even went further because they ignored the report of the National Commission on State Workmen’s Compensation Laws, and went ahead with a plan to federalize part of the workers’ compensation system.

According to Joe, the reason why the small employer mandate has been delayed is because the “Feds are incorporating a national “single payer” work comp program” that is not ready to be introduced.

This program is called POWER (Protecting Our Workers and Ensuring Reemployment). It is to be administered by the Office of Workers’ Compensation Programs.

Without going into any great detail about the program, here are the key takeaways from Joe’s article:

  • POWER was not part of the original healthcare reform bill; it was initiate as part of a Presidential directive (boy, this is really going to get the Tea Party angry) shortly after PPACA was passed and signed into law. ( July 19, 2010)
  • Detailed in the POWER initiative, the program will measure employers; performance across eight metrics, with those employers failing to demonstrate improvement targeted for additional Federal oversight (another thing that will launch the Tea Party into orbit)
  • Implementation date is June 1st; small employers (26-99 employees) will be required to sign up as their current workers’ comp policies expire
  • Employers WILL be allowed to “opt out”
  • POWER will utilize OSHA reporting system to cross-index claims reporting
  • Employers will avoid reporting claims to reduce the risk of the dreaded “additional Federal oversight.”
  • The federal fee schedule will likely be used for medical treatment, and
  • OSHA will have to revamp their reporting process

It is Joe’s opinion that now that the health exchange “glitches” are mostly fixed, the workers’ comp program will move very quickly, and it will be much less complicated, as there will be a single payer, a single payment system, and universal benefits and coverage specifications.

What does this mean for medical tourism and workers’ compensation?

My guess is that depends on how you view a federal role in workers’ compensation in the first place. Some may like that idea and some may hate it. It could be a boon for medical tourism because now there will be federal coverage for workers’ compensation for employers with less than 100 employees, and as many people have already commented on social media and in medical tourism forums, the ACA may bring more patients to medical tourism destinations.

But it could also be a hindrance because we don’t know how flexible federal workers’ comp rules and regulations are regarding the location of treating physicians, the licensing of physicians, liability and malpractice laws, and whether federal law recognizes the right of choice of physician to the employee or his employer.

In addition, the federal fee schedule for medical procedures may or may not be lower than the fee schedules in states that have fee schedules, or lower in those states that do not have fee schedules. If the federal fee schedule is lower, the question then becomes, can medical tourism physicians and facilities quote lower costs than even the federal fee schedule? (airfare and accommodations included in the cost of going abroad).

Finally, medical tourism facilitators, providers and facilities will have to adhere to OSHA rules under the POWER program. Will facilitators and providers and facilities be able to comply with and understand OSHA rules? That and the other points I mentioned is what will ultimately determine if this program will be a boon for medical tourism. I really don’t know. Only time will tell. It’s up to the medical tourism industry to decide if it is worth going after.

Happy April Fool’s Day everyone! It really was a joke on Joe’s part! 🙂


This entry was posted in Affordable Care Act, Health Care Reform, Medical Tourism, Workers' Compensation and tagged , , , , , , , on by .

About Transforming Workers' Comp

Have worked in the Insurance and Risk Management industry for more than thirty years in New York, Florida and Texas in the Claims and Risk Management spheres, primarily in Workers’ Compensation Claims, Auto No-Fault and Property & Casualty Claims Administration and Claims Management. Have experience in Risk and Insurance Business Analysis, Risk Management Information Systems, and Insurance Data Processing and Data Management. Received my Master’s in Health Administration (MHA) degree from Florida Atlantic University in Boca Raton, Florida in December 2011. Received my Master of Arts (MA) degree in American History from New York University, and received my Bachelor of Arts (BA) degree in Liberal Arts (Political Science/History/Social Sciences) from SUNY Brockport. I have studied World History, Global Politics, and have a strong interest in the future of human civilization in all aspects; economic, political and social. I am looking for new opportunities that will utilize my previous experience and MHA degree. I am available for speaking engagements and am willing to travel. LinkedIn Profile: Resume:

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