Texas Research and Evaluation Group (REG) and Division of Workers’ Compensation (DWC) have presented a key finding in their recent Employer Participation in the Texas Workers’ Compensation System survey: a higher percentage of Texas employees working for nonsubscribers are now covered by an injury benefit program as an alternative to workers’ compensation than at any point in the past eight years. This finding is backed by:
- A consistent percentage of nonsubscribing employers offering injury benefit programs, and
- An increase in the percentage of Texas employers with more than 100 employees that are nonsubscribers.
Ryan Brannan, former Commissioner of Texas Workers’ Compensation and current Government Relations Consultant to ARAWC, emphasizes the significance of these findings. He states, “The latest report shows a vast majority of Texas employees of nonsubscribers are now covered by injury benefit programs, providing them access to the advantages these programs offer, like better medical outcomes and higher disability benefits. The expansion in coverage is fueled by larger employers’ growth and ongoing interest in occupational benefits plans across businesses of all sizes, thanks to ARAWC advocacy and introduction of the QCARE program.”
The report points to a rise in the employer subscription rate to 75% in 2022. This finding correlates to recent improvements to Texas workers compensation as a result of competition with the nonsubscriber alternative.
The Employee Retirement Income Security Act (“ERISA”) regulates occupational injury benefit programs and provides important reporting, disclosure and fiduciary protections to covered employees. Nevertheless, the study emphasizes the importance of nonsubscriber employers satisfying additional QCARE quality standards if they choose an alternative to workers’ compensation. While ARAWC advocates for freedom of choice, QCARE’s focus is on ensuring responsible nonsubscription.
Over the past five years, Texas occupational injury benefit programs have gained credibility and appeal through the following five key initiatives:
- Removal of exclusions and limitations on coverage
- Clarity in the same goals as workers’ comp and how they achieve those goals
- Proof that injury benefit programs commonly pay better wage replacement benefits
- The new QCARE designation for responsible injury benefit programs
- Further, credible research on the better medical outcomes achieved by these programs.
ARAWC acknowledges that the COVID-19 pandemic may have affected interpretations of recent report data and clarifies that marketplace data and intelligence from ARAWC and its members were not included in these studies. ARAWC remains available to REG and DWC to improve the quality of their employer surveys and is dedicated to providing comprehensive feedback on future reports to increase their accuracy and reliability.
In conclusion, the 2022 survey depicts a stable and competitive landscape in Texas, revealing the sustained value of employer choice between workers’ compensation and alternative injury benefit programs, contributing to the state’s thriving business environment and better outcomes for injured workers. Nevertheless, it is critical for employees, business partners, regulatory agencies and others to collaborate with employers offering QCARE-qualified plans to ensure responsible nonsubscription.