How Opioids Affect Workers' Comp Costs

mar 3 blog image

Opioid use among employees continues to rise, presenting a myriad of unprecedented challenges for small and midsized employers. Among these challenges include navigating workers’ compensation claims when opioids are involved - either as a result of a work-related injury or contributing to a work-related injury.

The Reach of the Opioid Crisis

Considering 11.5 million Americans misuse prescription opioids, there is no doubt that the epidemic crosses the boundary between home life and professional life, dramatically impacting employers. Here's why it's so important for employers to be aware of the epidemic and invested in prevention:

  • two-thirds of people suffering from an opioid use disorder are in the workforce
  • opioid addiction makes it more challenging to recruit qualified employees who are able to pass drug screening requirements
  • those with opioid use disorders are at greater risk of both reduced productivity and absenteeism
  • the economic burden of this disease was $504 billion in 2015 alone, and in 2016, American employers spent $2.6 billion on opioid treatment and medical care related to overdoses, contributing to the rising cost of healthcare premiums
  • annually, the employer pays $7,000 in healthcare costs for an employee with an untreated opioid use disorder, and that number increases to $35,000 per year in safety-sensitive industries
  • employees who misuse opioids are at higher risk of participating in illegal activities, like buying and using illegal drugs, which may require action on an employer's part (dismissal, referral to treatment, etc.)
  • impaired employees are at higher risk of accidents harming themselves, their coworkers, and their workplace

kansas city's opioid surge what employers can expect

 

Opioids and Workers’ Compensation

Here’s what you need to know at the intersection of opioid addiction and workers' compensation: 

  1. Most states allow for a denial or reduction of benefits if the employee was under the influence or drugs or alcohol when an injury or accident occurred. For this reason, employers can protect themselves and their stakeholders by implementing a post-accident drug-testing policy, requiring all employees who have had an accident at work - that results in either injury to themselves or someone else or damage to company property - to submit to a drug test immediately following the accident. 
  2. Work-related injuries are directly contributing to the opioid crisis. According to the Centers for Disease Control and Prevention (CDC), 15% of the workforce suffers from chronic pain and millions of employees are prescribed prescription opioids for work-related strains, sprains, and fractures. Perhaps even more alarming, 15% of workers' compensation patients taking opioids are taking them for an injury that occurred six or more years ago. Employers must be good stewards of their human resources by providing a safe workplace with the appropriate training, equipment, and safety measures in place. Employers who work to prevent workplace injuries also reduce the risk of opioid addiction. 

    Opioids int he Worplace - steps employers can take to reduce employee substance abuse
  3. Employees on high dose opioids miss more work. California Workers' Compensation Institute conducted a study that found that employees who are prescribed high-dose opioids for a work-related injury stay off of work three times longer than those prescribed low doses, increasing the financial burden on the organization as well as the physical burden (and risk of injury) on coworkers, who are often pressured to achieve the same output with fewer days during the absence. Workers' compensation premiums can rise as a result of lost wage claims. 
  4. Employees prescribed opioids incur higher claims. As your organization works to reduce Workers’ Compensation injuries and claims, those who are prescribed opioids incur higher claims overall due to extended recovery time, the cost of opioid prescriptions, potential for addiction, and the treatment services rendered to address it. 

Key Takeaways

Employers can reduce their risk and navigate workers’ compensation claims successfully by implementing pre-hire and post-accident drug screening; working closely with DMPs to share the employer’s perspective on the use of prescription drugs, and creating a workplace that inherently promotes safety and prevents injury. Partnering with a PEO can help ensure that the appropriate policies, procedures, and training are implemented for maximum risk mitigation.

 

Steve Donovan

Written by Steve Donovan