The workers’ compensation system as we know it today has not changed in ways that anyone would consider major since it was created over a century ago. Each year, states spend years trying to repair one area of the program and chip away at another. At the end of the day, one group wins and another loses, but workers rarely gain any benefits.
Few would argue against the fact that an injured worker needs and deserves protection. Assistance is necessary when someone is injured while on the job. What many don’t agree on is the roles employees and employers should play in a program that offers such protection.
Close to 25 years ago, Texas became the first state to begin moving away from the traditional form of workers’ compensation insurance. Employers who chose to not participate in a traditional plan, built and managed their own benefits program. These programs were and are clearly explained to employees and new hires. Today, nearly one-third of all employers are covered by this “Texas Option.”
Seeing the success in Texas, Oklahoma decided to build its own option in 2012. The two programs are not identical, but they each contain the same three components: employee accountability, free-market competition and medical management control. Oklahoma employers have jumped on board and, four years later, more are using the option instead of traditional insurance.
Employers, Option brokers, TPAs and other service providers were quick to recognize the success of the option in Oklahoma and have formed a core group to offer programs in other states. The Association for Responsible Alternatives to Workers’ Compensation (ARAWC) is now advocating for the option in states across the nation.
The group plans to work with state employers and legislators to create state-specific Options. The group provides a model framework but will remain flexible in order to create plans that make the most sense for the employers and employees of the states it works with. This is sure to provide a very real alternative to the traditional workers’ compensation system that has only made very minor adjustments over the last 100 years, despite very major changes in the workforce.