Workers’ Comp Medical Marijuana: Summer 2015 Update

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medica marijuana spring 2015

Will California allow medical marijuana in workers’ comp? The case of Christopher Cockrell v. Farmers Insurance, Liberty Mutual should shed some light on the matter in the upcoming months.

In the Cockrell case, California attorney Christopher Cockrell sustained an injury to his back, elbow, and heart, while working for Farmers Insurance. Cockrell’s workers’ comp claims were administered by Helmsman Management Services, a third party administrator (TPA) owned by Liberty Mutual. As part of Cockrell’s treatment plan, he self-procured medically recommended marijuana.

In 2011, Cockrell and the TPA stipulated to have an Agreed Medical Examiner (AME), Dr. Ernest Levister, determine if the medical marijuana was reasonable and necessary. The AME agreed to the use of marijuana given the applicant’s claim that his prior opioid use had proved problematic. The AME opinion, therefore, was found to be substantial un-rebutted evidence under LC Sec. 3202.5. Marijuana use is not covered by Medical Treatment Utilization Schedule (MTUS).

Compassionate Use Act Leads to Reimbursement Order

Later, Cockrell sought reimbursement from the TPA for his medical marijuana, (as opposed to the TPA providing marijuana or paying a supplier to do so). On June 20, 2012, the workers’ comp judge (WCJ) found that medical marijuana was reasonable and necessary under LC Sec. 4600, since the Health & Safety Code Sec. 11362.785(d) (AKA the Compassionate Use Act of 1996, which made medical marijuana legal in California) does not bar reimbursement. The WCJ ordered the TPA to reimburse Cockrell for the marijuana.

Decision Rescinded and Reinstated: Defining the Insurance Carrier

The TPA sought reconsideration, and in September 2012 the Workers’ Comp Appeals Board (WCAB) granted it and rescinded the decision. The WCAB remanded with this question: Does a workers’ comp insurance carrier fall under the definition of a “health insurance provider” or a “health care service plan” within the meaning of Health & Safety Code Sec. 11362.785(d)?

This is significant, as that code says health insurance providers and health care service plans are not liable for any claim for reimbursement for marijuana. On remand, the WCJ did not analyze whether a workers’ comp insurer was a “health insurance provider” but did rule that a workers’ comp carrier is not a “health care service plan.” The WCJ again ordered the TPA to reimburse Cockrell.

The TPA sought reconsideration again, but was not granted it until September 2014. Six months later, the WCAB, consisting of Commissioners Lowe, Sweeny, and Zalewski, struck the WCJ’s order for reimbursement, ordering the WCJ to examine Health & Safety Code Sec. 11362.785(d), which states that a “health insurance provider” is not liable for reimbursement for the medical use of marijuana. It is unclear why the WCJ did not analyze this the first time; the case has now gone back to the WCJ.

Will the WCJ Rule Differently Depending on the Type of Insurance?

According to the WCAB’s statement, as the WCJ examines whether a workers’ comp insurance carrier falls under the definition of “health insurance provider,” that judge will need to analyze whether or not there is any rational basis to treat occupational and non-occupational insurers differently with regard to reimbursement for medical marijuana. For example, in group health, Kaiser Permanente, per the Health & Safety Code above, would not have to reimburse a Kaiser insured patient for medical marijuana. In that instance, the medical marijuana is legal, but not covered by insurance.

Experts believe this case will make its way back to the WCAB, then to the Court of Appeal, and finally to the Supreme Court of California. No one can predict the Supreme Court’s verdict. Either way, Cockrell v. Farmers Insurance, Liberty Mutual, once resolved, is set to be a landmark ruling for the issue of medical marijuana in California workers’ comp.

Tom Swiatek

As Assistant Vice President of Regulatory Services and General Counsel, Tom Swiatek draws on his experience as an insurance attorney on both the general liability side, as well as on workers’ compensation matters. As a Workers’ Compensation Section Member, Tom is leading the discussion with respect to the regulatory challenges and opportunities facing the workers’ compensation system.