When Businesses Opt Out Of Workers' Comp, Employees May Struggle For Care As states consider allowing employers to completely opt out of workers' compensation plans, NPR and ProPublica take a look at how the concept has worked in Texas.

When Businesses Opt Out Of Workers' Comp, Employees May Struggle For Care

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Some employers are dropping out of workers' compensation programs. We've been reporting on how they set up their own work place injury plans instead. And we're about to go where this trend started, Texas. Their employers have been opting out of workers' compensation for decades. Our joint investigation with ProPublica found the alternative system benefits employers just not necessarily their workers. NPR's Howard Berkes reports.

HOWARD BERKES, BYLINE: Billy Doyle Walker loved being in places like this.


BERKES: A bucolic setting of lush meadows and squat oaks. It's peaceful and historic. This is the Texas ranch of former President Lyndon Johnson. And rising 300 feet is a steel, red and white communications tower. Billy Walker was here three years ago applying fresh paint more than halfway up. His wife, Krystle Meloy, was at home when she got the terrible news.

KRYSTLE MELOY: They just walked in very silent, you know, straight faces. They were trying not to cry, basically. They said Billy fell. You know, he's on his way to the morgue. And I said, what? And that's when I just couldn't even hold my knees. I just fell, and we all just started crying.

BERKES: Walker's employer was cited for safety violations and had opted out of state workers' comp. It had a workplace injury plan instead, which paid a death benefit of $250,000. If the company had workers' comp, Meloy and her daughter could have received as much as a million dollars in lifetime payments.

MELOY: When you die that tragically and you're a good person and you love - he just had a child - his first and only child. And he loved me and her. I just feel he was worth more. It's sad. I mean, it's just - I feel desperate.

BERKES: Krystle Meloy is struggling to get by on Social Security and can't afford day care. Most of the money she received is in a trust for her daughter and went for bills and a place to live. Meloy is among the survivors and injured workers in Texas who find the alternative to workers' compensation doesn't work well for them. Payments are smaller. They're cut off far sooner. Fewer injuries are covered, and strict rules can leave them without any benefits at all. Rick Levy is with the Texas AFL-CIO.

RICK LEVY: What is being allowed is the employer to have absolute and complete control over every aspect of the system - no negotiation, no compromise, no standards, no due process.

BERKES: The same system saves employers 40 to 90 percent in claims costs according to Bill Minick of PartnerSource, a company that promotes rights and supports alternative plans. We told Minick about Krystle Meloy.

BILL MINICK: You know, this is a difficult situation it sounds like. There's no occupational injury system that we've found yet that will provide perfect results in 100 percent of cases. What we need to consider is what system is going to provide the best result in more cases?

BERKES: Minick says heavily-regulated workers' comp has higher medical and employer costs, delays in treatment and expensive and time-consuming litigation. He says opting out of workers' comp provides a...

MINICK: Free market environment, which encourages competition and more aggressive, best practice development and patient care. A component of that needs to be some measure of self-regulation.

BERKES: That means being flexible with benefits and rules. But with no state regulation, there's nobody to make them do it. And NPR and ProPublica found workers who've suffered as a result. Joe Becker is a 44-year-old truck driver in Abilene, Texas who stepped down from his flatbed trailer and felt a sharp pain in his back. Three years later, he's still in pain.

JOE BECKER: Feels like somebody's got a pair of soccer cleats on, pushing their foot into my back repeatedly.

BERKES: Becker grimaces in his darkened living room, where drawn drapes and a humming air conditioner ward off summer heat. His employer, Dent Truck Lines, doesn't subscribe to workers' comp. Owner Cliff Dent says his alternative plan costs about half as much, perhaps because it doesn't last as long.

BECKER: They paid everything up to the 104-week mark. After that, it was - everything's been left to me, doctor bills, medications, even the additional surgery, you know, $10,000. I don't have that.

BERKES: Another surgery is needed to relieve ongoing pain and to get Becker back to work. Workers' comp would have covered medical bills and wage replacement payments as long as necessary. Rebecca Amador is also struggling and still in pain two years after her injury at the Mulberry Manor Nursing Home in Stephenville, Texas.

REBECCA AMADOR: Like I'm in a fire, and I can't get out of that fire. That's how it hurts.

BERKES: The petite Amador, who was 51 then, bore the full weight of 250 pound patient when a wheelchair brake slipped. Amador felt a pinch in her back but figured it might go away. That night, the pain was so severe she could hardly breathe. But she was denied benefits because she hadn't reported the injury by the end of her shift.

AMADOR: I think they did me wrong. Me being there so long, helping them as much as I can, I could not believe they did this to me. When I most need them, they don't know me anymore.

BERKES: Amador would have had 30 days to report her injury if Mulberry Manor had workers' comp. The spokeswoman for her employer declined to discuss the case. Seventy percent of the alternative Texas plans reviewed by ProPublica and NPR have the same rules - injuries must be reported by the end of the shift. Bill Minick and PartnerSource are not involved in these cases, but Minick says there's a good reason for tighter rules and lower benefits in Texas, including the death benefit received by Krystle Meloy.

MINICK: Part of the reason why $250,000 would be a reasonable level for a death benefit is that there's that additional liability exposure.

BERKES: Under workers' comp, employers are shielded from workplace injury lawsuits. That's the trade-off for guaranteeing care and benefits for as long as necessary. Opting out of workers' comp in Texas removes the shield and makes lawsuits possible. So if the alternative plan isn't paying enough long enough, sue the employer, maybe for negligence or for violating federal workplace benefits law. Joe Becker is trying. By the time his case gets to court, he'll have an entire year of pain without the surgery he needs. Krystle Meloy also tried to sue.

KAYLEE: What's that? What's his name? Daddy Billy. Whoa. That's his name.

BERKES: Meloy's daughter, Kaylee, is now 3, and she only knows the man she calls Daddy Billy through snapshots in a photo album. Her mother had high hopes when she sued given the safety violations of the tower. Then, Billy Walker's employer declared bankruptcy. Howard Berkes, NPR News.


INSKEEP: We have more details of our investigation at npr.org, including charts that you can use to compare alternative plans to workers' comp laws.

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