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Regulation and Compliance > State Regulation

Medical marijuana leaves workers’ comp in cloud of confusion

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At the federal level, at least, there’s no confusion over medical marijuana and whether it’s covered by workers’ compensation insurance.

Marijuana possession is still considered illegal by the U.S. Justice Department, so “federal workers’ comp is clearly not paying for any medical marijuana, period. (But) it’s a trickier issue on the state level,” said Trey Gillespie, the senior workers’ compensation director for the Property Casualty Insurers Association of America.

Indeed, it is. That’s why Gillespie said PCI is closely watching the issue, “because it creates somewhat of a conundrum for employers. On one hand, they want safe workplaces. On the other hand, they don’t want to infringe on employee rights.”

There’s a lot to watch.

About 20 states, along with the District of Columbia, have legalized medical marijuana, while two states (Colorado and Washington) have legalized marijuana for recreational use.

In Florida, organizers have gathered enough signatures to put the question of legalizing medical marijuana on the ballot in November. In New York, Gov. Andrew Cuomo has announced a medical marijuana pilot project in his state.

Moreover, “we’re already seeing a host of bills (in state legislatures) this year related to marijuana,” said Lori Lovgren, the division executive of state relations for the National Council on Compensation Insurance Inc.

The NCCI highlighted medical marijuana as one of the top emerging workers’ comp issues to watch in 2014.

Hoping to get a clearer picture, the International Association of Industrial Accident Boards and Commissions last year surveyed states regarding their regulation of marijuana in workers’ comp claims, according to Executive Director Jennifer Wolf Horejsh.

Most of the states responded that they do not have any specific regulations in place, which may help explain why comp insurers are increasingly receiving requests to pay for medical marijuana.

Gillespie noted that, in most states, the law says insurers have to pay “for reasonable and necessary expenses that are proven to be efficacious.”

“I think that most insurance companies have probably taken the position that medical marijuana has not been conclusively found to be an efficacious treatment,” he said.

Of course, when that happens, “if the insurer says it will not pay, then the worker would be at risk for paying for it. In most jurisdictions, the carrier pays for treatment or nobody pays. There’s not supposed to be cost-shifting,” he said.

As might be expected, the big concern about medical marijuana, according to Gillespie and Lovgren, is its impact on safety and productivity in the workplace.

“Just because you’re taking medical marijuana for medical use doesn’t means it’s safe to use on your job,” Gillespie said.

More to the point, if employers or insurance companies pay for medical marijuana they might become liable for additional injuries caused by drug intoxication, Lovgren said.

She noted that, according to the National Institute on Drug Abuse, “marijuana has the potential to cause or exacerbate problems in daily life, including increased absences, tardiness, accidents, workers’ compensation claims and job turnover.”

And an employee who can legally use medical marijuana while off duty may still face consequences, including termination, for arriving at work with a detectible amount of marijuana in his or her system, she said.

So far, when courts have issued rulings related to medical marijuana and the workplace, they have been in the employer’s favor. 

  • In Casias v. Wal-Mart Stores Inc., the U.S. Court of Appeals for the 6th Circuit ruled that a Michigan employee who was fired by Wal-Mart after testing positive for validly obtained medical marijuana cannot sue the company for violation of the Michigan Medical Marihuana Act because the law does not regulate private employment.
  • In Roe v. Teletech Customer Care Management, the Washington Supreme Court ruled that the state’s Medical Use of Marijuana Act does not protect medical marijuana users from adverse hiring or disciplinary decisions based on an employer’s drug test policy.
  • In Ross v. RagingWire Telecommunications Inc., the California Supreme Court ruled that it is not discrimination to fire an employee for using medical marijuana. RagingWire terminated the plaintiff’s employment based on a positive test for marijuana even though the employee had provided a doctor’s note explaining that he was prescribed marijuana to alleviate back pains. 
  • In Emerald Steel Fabricators, Inc. v. Bureau of Labor & Industries, the Oregon Supreme Court ruled that because federal criminal law preempts Oregon’s medical marijuana law, employers in the state do not have to accommodate employees’ use of medical marijuana.


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