Last Thursday the Oklahoma Supreme Court unanimously ruled that a state workers compensation commission established by major reforms last year does not have jurisdiction to adjudicate claims for injuries occurring prior to the commission’s effective date. The decision means that Oklahoma may be running two distinct workers compensation systems for many years to come.
It is the latest example of unintended consequences resulting in the continuing reform of reformers reforms.
Oklahoma’s landmark bill SB1062 carried two major components. The first, which garnered the bulk of attention nationally in our industry, was “opt out”, providing employers in that state a means to choose an alternate route and bypass workers’ compensation coverage. The other major element was to convert the states judicial comp system to an administrative one.
The Workers’ Compensation Commission was established in that effort, and was to oversee claims that occurred after February 1, 2014. Claims occurring prior to that date would be handled by the Oklahoma Workers’ Compensation Court of Existing Claims up until 2020. After that time all remaining open claims were to have been migrated to the new administrative system.
The Supreme Court, however, has different views on the matter. In their opinion, which reads, “All aspects of the adjudication of claims for injuries occurring prior to Feb. 1, 2014 are governed by the law in effect at the time of the injury”, they determined the state must now continue to operate the Workers’ Compensation Court until all open claims are settled. With more than 100,000 cases in the queue, that likely means operations will continue there for many years.
This is going to be a minor nightmare for people managing comp claims in Oklahoma. Trying to navigate one system is tough enough – managing your way through two different systems should put some claims professionals on suicide watch. Even here in my office we’ve had to move all the sharp objects off of the desks of our Compliance people. The look on their faces this week frankly scares me a bit.
Now, I am no expert on Oklahoma law, so I will do what all non-experts do when they, regardless of their ignorance, insist on opining on the topic anyway. I will ask some questions. What happens to secondary claims? Let’s say for example that John Doe twisted his knee on January 31, 2014, and then hurts himself again on February 15, 2014. If the second injury is a re-aggravation of the first, well that is one thing; but what if it is determined to be a new and unrelated claim? Does Suzy Q. Adjustor now have to navigate two separate systems for the same claimant? And does that apply if the second injury was partially attributable to the first?
In a world where 80% of our claim activity comes from 20% of our claimants, that is not an unlikely scenario.
Even if a different adjustor handles the new claim, who wants to explain to Mr. Doe that each claim has different rules, different benefits and in fact are adjudicated by completely different systems? And it will be this way for the life of his claims? Not to mention, how do we justify to stakeholders that identical injuries in different systems have completely different processes and benefits, even 10 or 20 years down the road?
Oy vey ist mir.
To compound the issue, this was just one of the early tests of Oklahoma's new law. One plaintiff's attorney in Oklahoma City believes he has “identified more than 50 potential constitutional questions raised by the workers comp law”.
Please understand I am not being critical of Oklahoma reform, or even the court that has now altered a component of it. It is just the process we see when we attempt to alter such complex systems, and the unintended turns that we often experience as a result. So down the rabbit hole we go, creating mayhem and confusion under the banner of reform.
I can't complain, actually. Changes like this help keep many of us in business, even if it does make our Compliance people grumpy.