Bill Minick is the president of PartnerSource, a Texas company that helps draft laws allowing companies to opt out of state workers' compensation plans. Rachel Jenkins welcomes her daughters Kyonna Jenkins (left) and Ti'yonna Hill home from school in Boley, Okla. Originally published on October 15, 2015 6:07 am Billy Doyle Walker loved working in the sky.
Originally published on October 15, 2015 5:07 am Billy Doyle Walker loved working in the sky. Nearly two years after hurting his back at work, his benefits have stopped even though he's still in pain and in need of another surgery. Rachel injured her shoulder while working as a nursing assistant and was originally denied benefits because she reported the incident three hours too late. He used to say he could see forever, perched high up communications towers as he applied fresh paint. The opt-out plan his employer used provided his family with only a quarter of the benefits it might have received under the state's workers' compensation law.
Three years ago, working halfway up a 300-foot steel tower at the LBJ Ranch, the panoramic view included the rolling green hills and meadows of the Texas Hill Country. She was home at the couple's apartment in New Braunfels, Texas, with their 4-month-old daughter, Kaylee, when several of Walker's co-workers unexpectedly knocked at the door. And we all just started crying." What happened next to Meloy and Kaylee is indicative of an emerging trend in how workers and their families are compensated following workplace injuries or deaths. Nearly 1.5 million workers in Texas and Oklahoma do not receive state-mandated benefits under heavily regulated workers' compensation and are dependent instead on alternative, largely unregulated benefits plans controlled by employers.
State laws in both Oklahoma and Texas allow employers to opt out of workers' compensation and develop their own workplace injury plans. Those plans generally cover fewer injuries, cut off benefits payments sooner, control access to doctors and even impose mandatory settlements, according to an NPR and ProPublica investigation. In Oklahoma, we found that most plans blatantly violate the law, yet regulators say they are powerless to respond. NPR and ProPublica obtained nearly 120 opt-out plans used by Texas and Oklahoma companies and analyzed how this alternative to workers' comp compares with the system it's replacing. We found widespread differences in benefits among employers, and restrictions and requirements that make it easier for employees to be denied coverage.
Among the details in some employer plans: Brookdale Senior Living, the nation's largest chain of assisted living facilities, does not cover most bacterial infections. Foods, the nation's second-largest food distributor, excludes any sickness or disease "regardless of how contracted," potentially allowing the company to dodge work-related conditions such as heatstroke, chemical exposures or cancer. The analysis also found that many plans in Texas cover medical care for only about two years, whereas workers' comp pays as long as necessary.
Plans exclude payments for things like wheelchair vans and chiropractors or for injuries caused by exposure to silica dust, mold or asbestos. No due process." Most of the opt-out plans we reviewed in Texas — officially known there as "non-subscription" plans — strictly limit payments for catastrophic injuries and deaths on the job. His employer, Ransor Inc., paid a lump sum death benefit of $250,000, which mostly went into a trust for their daughter and paid for bills and a place to live.
If Ransor had subscribed to workers' comp, the state-prescribed formula for death benefits could have paid Meloy and Kaylee as much as $1 million during the rest of their lives.
Without her husband's income, Meloy struggles to get by on Social Security and is applying for food stamps. She says the jobs she can get don't pay enough to cover day care and other living expenses. It's sad." Proponents of the opt-out plans say they are not designed to reduce benefits but rather to impose some sanity on a bureaucratic system that is expensive, slow and inefficient and that often winds up forcing injured employees to go to court.
PartnerSource also set up opt-out advocacy and lobbying groups, and it consults for some of the biggest and best-known employers in America. When you're saving that kind of money, you don't have to get hung up on squeezing the employee." Minick's company had no role in Ransor's workplace plan. What we need to consider is what system is going to provide the best result in more cases." As NPR and ProPublica have reported, in the past 13 years legislatures in 33 states have cut benefits, made it more difficult to qualify for benefits or given employers more control over medical treatment. Some states went through protracted, repeated and often painful efforts to rewrite workers' comp statutes. A single piece of legislation in each state gives employers the ability to write their own workplace injury benefit plans. The changes found in Oklahoma's opt-out plans include new requirements for reporting workplace injuries. Last March, Rachel Jenkins was denied benefits for a workplace injury witnessed by her supervisor at a company called ResCare. The single mother of four was a job coach and personal care aide for mentally disabled adults when a client was suddenly attacked by another man.


I had to put all of my strength into this man and that's when I hurt my shoulder." Jenkins went to the emergency room and was given pain medication that knocked her out, she says, into the following day.
ResCare sent her to a company-selected doctor, and 27 hours after the incident, she called the ResCare injury reporting hotline.
A ResCare claims representative told Jenkins she was too late "because I didn't call the number within 24 hours," Jenkins recalled. She was like, 'I understand you got four kids but there's nothing I can do.' " Nothing Jenkins said to ResCare made a difference. It was not fair to the injured worker," says Minick of PartnerSource, which wrote the ResCare plan. That's not how Jenkins sees it, after enduring 16 days of pain while unable to afford treatment and worried about getting back to work. His company, PartnerSource, also wrote 53 of Oklahoma's 59 opt-out plans, for employers ranging from small health care companies to major national firms, including Macy's, Swift Transportation, Dillard's Department Stores, Big Lots and Cabela's. On paper, the benefits in the Oklahoma plans look similar to — or better than — state workers' comp.
An analysis by ProPublica found that 80 percent of the plans actually provide lower benefits.
But almost every PartnerSource plan includes a section titled "Mandatory Final Compromise and Settlement." The provision gives employers the right to determine when to settle and how much to pay.
If workers don't accept the terms, the plans say, "no further benefits will be payable." The state's insurance department approved every one of those plans. NPR and ProPublica cited this inconsistency between the plans and the law in emails and then an interview with officials at the Oklahoma Insurance Department. General Counsel Gordon Amini acknowledges the discrepancy and says the agency hadn't noticed it until we asked about it.
In fact, NPR and ProPublica reviewed more than 2,000 pages of internal emails between the agency and PartnerSource and employers. In almost every instance, the agency only cited errors in punctuation, spelling, grammar and even formatting. One email between an agency lawyer and a chain of long-term-care facilities notes a missing period in a paragraph that causes a run-on sentence. The same paragraph says the employer promises "no interference" with the doctor-patient relationship — while also warning workers that seeing their own doctor, instead of a doctor selected by the company, "may result in a complete denial" of benefits. That's especially offensive to Burke, who is challenging Oklahoma's opt-out law on constitutional grounds.
Two years after her injury at work at a nursing home in Stephenville, Texas, nursing assistant Rebecca Amador is still in pain and out of work. Early the next morning, she returned to work, reported the injury and was sent to the hospital. But her employer, Fundamental Long Term Care, rejected any further care or benefits, saying Amador hadn't reported the injury by the end of her shift. If Amador had worked for Fundamental in any of the 12 other states in which the company operated and had workers' compensation, the injury would have been covered. When I most need them, they don't know me anymore." A spokeswoman for Fundamental declined to discuss the case. Even when employers do provide benefits, workers still sometimes get less under the opt-out plans, NPR and ProPublica found. Joe Becker, a 44-year-old truck driver in Abilene, Texas, received the medical care and surgery he needed, as well as money to replace lost pay, after he stepped down from his flatbed trailer and herniated several disks in his lower back. His employer, Dent Truck Lines, has a workplace injury plan that cuts off benefits after two years. Minick of PartnerSource insists employers care more for workers now in his "free market" solution to a "hyperregulated environment." "Workers' compensation systems grew up at a time when employers did not care about their employees," Minick says. Now companies are competing to be the best place to work." Minick also points out that opt-out employers in Texas can still be sued for workplace injuries. It is known as the "Grand Bargain" and "exclusive remedy" and it exists because employers agreed to pay medical and wage replacement benefits, on a no-fault basis, even for life, if necessary. So opting out removes the shield, and the ever present risk of lawsuits provides a powerful incentive to treat workers right.
The plans also claim that they are regulated by a federal workplace benefits law, the Employee Retirement Income Security Act, or ERISA, even though the law specifically excludes benefit plans "maintained solely for the purpose of complying with applicable workmen's compensation laws." If ERISA applies to opt-out plans, employers are able to assert federal court jurisdiction and keep disputes out of state workers' comp commissions and state courts.
The burden of proof is higher for workers under ERISA and the federal court process can take far longer.
By the time his negligence lawsuit even gets to court, he'll have an entire year of pain without the surgery he needs. Her wrongful death lawsuit seemed promising because Ransor was cited and fined for safety violations in the death of Walker. Minick cites the possibility of a suit as justification for Ransor's $250,000 death benefit because Meloy had the opportunity to recover much more in a lawsuit.


Minick is working to spread the opt-out gospel to South Carolina and Tennessee, where a lobbying group he formed has bills pending.
Transcript DAVID GREENE, HOST: Let's return to an issue we've been following very closely this year, workers' compensation.
State regulated systems are supposed to pay medical bills and lost wages when workers are injured on the job. Earlier this year, NPR and ProPublica reported that dozens of states have either cut workers' comp benefits or made them more difficult to get. Employers in two states are dumping out of workers' comp completely and providing fewer benefits. That's what NPR and ProPublica found after reviewing dozens of employer injury plans that replaced workers' comp. HOWARD BERKES, BYLINE: Bill Minick says his Texas company, ParternerSource, has saved clients a billion dollars, money they didn't have to spend on workers' compensation. They avoided expensive treatment and litigation and delayed medical care by opting out of workers' comp. BILL MINICK: We can take care of injured workers more effectively, get them back to their families and to their work as productive members of society, save incredible amounts of money that create new jobs. BERKES: Some of Minick's clients pay more for lost wages in their own workplace injury plans. In Texas and Oklahoma, the two states that permit them, we found fewer benefits, tougher qualifying rules, even failures to comply with state law, regulators powerless to respond and workers suffering as a result.
The single mother of four tried to protect a client from an attacker at a sheltered workshop for disabled adults.
BERKES: Jenkins worked for ResCare, one of 59 employers in Oklahoma who've opted out of workers' comp.
They're supposed to provide the same forms of benefits, but NPR and ProPublica found major gaps.
They put me on some powerful medicine, but I was two or three hours late from calling the number.
Just giving the employer the right to deny all benefits - and no matter how serious the injury is - because it was not reported to a toll-free number within 24 hours, I believe is wrong. BERKES: Almost all of Oklahoma's opt-out plans have reporting deadlines of 24 hours or less.
MINICK: Simply by voicing the concern and by having the claim reviewed informally, it was determined that that was not a good denial.
BERKES: Well, not to Rachel Jenkins, given 16 days of pain while unable to afford treatment and worried about getting back to work.
Attorney Bob Burke doesn't blame PartnerSource or ResCare for problems with Oklahoma's alternative to workers' comp. BURKE: My fight is with the insurance commissioner of Oklahoma who approved that plan that clearly does not provide for the same benefits as required by statute. GORDON AMINI: It's my opinion that the Insurance Department does not have the statutory authority to disapprove or deny based on the content of the benefit plan. BERKES: So when the Insurance Department wrote employers and PartnerSource about problems in their plans, it focused almost exclusively on punctuation, spelling, language and even formatting. The agency didn't even notice mandatory settlements until we asked about them, according to Amini.
Bill Minick of PartnerSource says the plans will be revised, which Amini says the agency expects. AMINI: The statute does provide an appeal process for denial of benefits that are not paid. It's asinine to think that any accountability factor would be put on the backs of the victim.
BERKES: The harshest critics call opt-out a throwback to the industrial age before workers' compensation.
As for Rachel Jenkins, she was eventually sent to an ear, nose and throat specialist for her back and shoulder injuries.
He was a qualified doctor, says a ResCare spokeswoman, and he referred Jenkins to an orthopedic specialist, according to medical records which show ResCare rejected that referral.
PartnerSource and state lawmakers promise adjustments, but there's no pause in spreading the opt-out gospel.



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