The rapid emergence of COVID-19 creates new challenges for the nation’s patchwork of state run workplace benefit delivery systems. This paper draws a comparison between COVID claims and asbestos claims, the “Largest and Longest” wave of occupational disease claims in the United States. The comparison offers insight into avoiding past economic, administrative and benefit delivery pitfalls. The lessons from asbestos claims provide an insight into maintaining a sustainable workers’ compensation system to meet the surge of COVID claims.
- Efficient and Adequate Benefit Distribution System
The summary and remedial social insurance system of workers’ compensation was caught largely unprepared to respond to the challenges of the COVID pandemic.1 Although there have been 10 pandemics in the last 245 years, COVID is the first major viral epidemic that has involved workers’ compensation systems.
The program, conceived over a century ago, was a compromise between Labor and Industry, to keep costs low and benefits capped, while maintaining summary benefit distribution. The compensation act’s goal is to maintain an efficient and adequate administrative benefit distribution system for work related accidents and exposures. The rates of compensation are correlated to wages the employee earned at the time of accident or exposure.
- Collateral and Competing Factors
The compensation system’s present efforts are compounded by limitations and restrictions imposed by the ongoing public health emergency. The massive COVID public health effort being undertaken to cope with treatment, and virus containment in a depressed economic environment, makes the process of benefit distribution even more problematic.
I. A Long and Disruptive Evolution
The crafters of the workers’ compensation acts in 1911 were guided by the then existing European systems. While the European models eventually migrated to a national health care system, the US did not. The original US claim system dealt only with traumatic claims, and not occupational disease claims. The statutory inclusion of occupational disease claims was a slow process driven by employer profits. Decades after the original enactment of the US workers’ compensation acts, occupational claims were deemed statutorily compensable.
The transformation to inclusion of occupational claims was guided by several factors. In 1920’s asbestos exposure was initially reported by international scientists to be causally related to the illness and death in the workplace.2
Asbestos related condition became a compensable condition in many jurisdictions in the 1950’s. Industry lobbied for this change to shield themselves from uncapped economic damages of civil litigation. Recovery is limited by workers compensation acts [WCAs] by statutory schedules of payment geared to wages. The workers’ compensation system is a no fault system. In other words, if it happens in the “course of the employment” and “arises out of employment,” the accident or exposure is considered to be compensable.
The scientific community in 1964 reported the causal relationship of asbestos exposure in the workplace with disease and other fatal outcomes.3 The civil justice system transformed the asbestos litigation landscape. Employees began to sue their employers in civil actions for intentional torts. Employers who concealed hazardous information from their employees lost the shield of the “Exclusivity Doctrine,” a legal concept that limited injured worker’s recovery only to workers’ compensation benefits.
Inadequate and limited recoveries in workers’ compensation claims generated new lawsuits for civil liability against the manufacturers, suppliers and health research groups involved with asbestos. In 1971, a civil action4, was brought by injured workers and their dependents against the suppliers and manufactures of asbestos fiber. This and other lawsuits that followed, sought damages for injured workers over and above the limited benefits that workers and their dependents could receive from a workers’ compensation claim.
By 1975 asbestos cases were continued to flood the patchwork of US workers’ compensation systems. Eventually, the wave of asbestos claims expanded into a multitude of end-user cases and bystander/household cases. The soaring filings exceeded the financial resources of employers and their insurance companies.
During 1980’s the lack of funds to pay claims, by self-insured employers, and the exhaustion of insurance reserves and insolvency funds, started a downward fiscal spiral. Employers began filing for bankruptcy protection.5 Litigation became stalled by stays6 imposed by the bankruptcy courts, and final recoveries, paid decades later were dramatically limited and undervalued. Today, over 582 corporations involved in asbestos litigation have filed for bankruptcy.
The asbestos claim experience illustrates why it is critically important that all stakeholders act seriously in the COVID pandemic. The parties to the system must get ahead of the virus. They must adopt a prevention and mitigation strategy to potential occupational illness and death that the virus may inflict.
II. Similarities Between Asbestos and COVID Claims Remedies
Evaluation/preparation/trial similarities exist between asbestos and COVID actions.
A. Workers’ Compensation Claims
A workers’ compensation claim is the principal avenue of recovery for an employee. The medical costs are contained for most part and the payments for indemnification are scheduled. Employers enjoy limited liability.B. Intentional Tort Claims
To circumvent the workers’ compensation “Exclusivity Bar”, the employer must have committed an act that intentionally harmed the employee.7
C. Household Contact/Bystander Claims
Claims may be brought by family members (household contacts) if the substance or virus was brought home, ie. self/clothing/uniforms, by the employee and his or her family members become ill. Additionally, other non co-workers (bystanders), who were exposed from the ill employee’s worksite may also have claims.
D. Criminal Liability
Corporations and their directors and employees are exposed to criminally liable for violating statutory laws and regulations.
E. Public Nuisance Claims
A recovery against the employer may exist against the employer for maintaining a public nuisance. This theory of liability, not utilized in asbestos litigation, is currently being asserted in COVID claims. Similar to a noise pollution case, against an unruly neighbor, ie. barking dog or loud music.
The public nuisance theory was successfully pursued in another public health crisis, lead paint litigation. Public entities filed against various paint producers who incorporated lead pigment into their paint that ultimately resulted in toxic reactions for both the children and adults as the paint deteriorated, as the paint was removed, or sometimes inadvertently ingested by children when it chipped off painted surfaces.8
Several cases and appeals are of interest. The meat processing industry was the subject of an unsuccessful claim, dismissed at the trial level, for public nuisance. A claim for public nuisance is pending against McDonald’s.
III. Similarities Between Asbestos and COVID Claim Proofs
There are similarities in proof issues between asbestos and COVID litigation.
One asbestos fiber is enough to result in disease. The COVID virus is so new that the scientific research has not quantified the amount of viral load necessary to establish causal relationship.B. Biological Markers
Biologically, the presence of asbestos may be identified by radiology and pathology. In COVID similar procedures could be adopted. Genetic testing, radiology and blood tests may be utilized to identify the COVID infection.
C. Product Identification
Identification of the specific cause is a challenging issue. In asbestos litigation, decades of research are available to identify site where a specific manufacturers product was present. There are established databases of identified specific sites and products containing asbestos fiber. Physical evidence of products can be identified by sales and purchase receipts and through visual identification. In COVID, the coronavirus is microscopic and everywhere.9 The virus is virtually invisible to the human eye. Testing could ultimate help narrow the scope of identifying the source of the virus and its transmission path.10 Scientific evidence will become increasingly important in this process.
D. Statutory Presumption of Causal Relationship
Compensability of a workers’ compensation, a no-fault system, is satisfied by two prong test. The condition must “arise out of the employment” [AOE] and occur within “the course of employment” [COE]. The AOE component, attributing a medical condition to work, is more difficult task with COVID.
Several states have attempted to ease the burden of AOE through enacted or proposed regulations, statutes or executive orders by creating a rebuttable presumption of compensability. Under a presumption law, the worker is preempted to have sustained a work-related medical condition, if certain eligibility criteria are met. Some of the presumptions are rebuttable and the burden shifts to the employer who has the burden of proving that the condition did not AOE.
E. Personal Protective Equipment
Some jurisdictions allow for an employer to assert a defense if personal protective equipment utilized to protect workers is not utilized by a worker. The essential questions is whether the type of Personal Protective Equipment [PPE] offered to the employee is actually effective to protect the worker.11 There are layering protocols for both asbestos and for COVID. PPE is being utilized by COVID workers not only to protect the employee, but also to protect transmission to another individual. The science becomes much more complicated in COVID as the recommendations protecting for droplet/airborne transmission remains conflicting.12
F. Damages/Permanent Disability
The damages in asbestos cases are pulmonary claims and malignancies. For COVID the research in science/medicine is still immature. COVID is an emerging area of science/medicine/law. The current epidemiology suggests: pulmonary, neurological, psychological, and cardiovascular and end organ damage.13 COVID infections may result in serious permanent and progressive medical conditions requiring medical monitoring and treatment for the life of the injured worker.
IV. The Federal Funding of Claims
The Federal government should indemnify employers and their workers’ compensation insurance companies from the uncertain economic consequences fo all aspects of COVID claims.
Asbestos disease claims were not indemnified by the Federal government. That resulted in the economic destruction of many asbestos companies. Those entities that were salvaged through bankruptcy procedures establishing trust funds. The trusts had limited resources to adequately fully compensate the injured workers and their families.
Unlike potential terrorism claims, there is no backstop/reimbursement of employers and/or insurance companies, ie. 9-11 Attacks on the US in 2001.14 If workers’ compensation programs are to remain an effective system to insure workers, in eluding essential employees, the program needs to remain solvent. The uncertainty of massive numbers of claims, reduced remain dollars because of business closings and reduce future premium dollars, it will be essential to keep the workers' compensation system solvent.
Despite the present social disconnect between many governmental leaders and the people, the workers’ compensation community has a responsibility to rely on science and evidence to drive their decision making going forward. This is a major communication challenge.
COVID is raging out of control15 and immediate action is required to contain the spread, until herd immunity or an approved vaccine is available. The next steps: deploy an effective testing strategy, quicker results and follow-up contact tracing. Workers’ compensation systems can play a major role in this effort.16
Every stakeholder involved in the process: Labor, Industry and governmental regulators and adjudicators, need to become educated on how to investigate COVID claims and establish an aggressive surveillance program on a priority basis. To contain spread of the virus, employers and insurance companies should act as contact tracers.17 They need to take action at first report of illness, even if testing results are delayed COVID claims must be handled with urgency. There must be better coordination with health agencies and technological integration to track cases and provide real-time reporting so that cases from asymptomatic through recovery can be identified to assist in workplace infection control and reopening.
Workers’ compensation programs should currently support new testing and treatment strategies; and commence an education program to encourage universal vaccination in preparation of the approval of successful candidates by governmental agencies.
Since the Federal government has handed-off the response to COVID to the states, communities and individuals, the Federal government should provide reimbursement. A Federal fund18 should be established to guarantee the fiscal solvency of all workers’ compensation programs involved in the global effort to safely get the economy back to work.
1 Gelman, Jon L., "Is the Workers' Compensation System Ready for the Covid-19 [Coronavirus] Virus?" (April 20, 2020).
Available at SSRN: DOI: 10.2139/ssrn.3581770, Updated 7/22/2020.
2 In 1924, Dr. Cooke in England reported the case of a woman who died of severe lung scarring after having spent 20 years in a textile factory weaving asbestos. Br Med J. 1924 Jul 26; 2(3317): 140-2, 147. doi: 10.1136/bmj.2.3317.147.
3 I.J. Selikoff J. Churg E. C. Hammond, “The Occurrence of Asbestosis Among Insulations Workers in the United States,“ Biological Effects of Asbestos, 132 Annals of the New York Academy of Science 1 (December 1965) pp. 139-155. https://doi.org/10.1111/j.1749-6632.1965.tb41097.x
4 Borel v. Fiberboard Paper Products Corporation, 493 F.2d 1076 (5th Cir. 1973).
5 In re UNR Industries, Inc., 23 B.R. 144, 9 B.C.D. 781 (Bankr.N.D.Ill.1982).
6 11 U.S.C.A. § 362(a)
7 Millison v. E.I. du Pont de Nemours & Co., 101 N.J. 161501 A.2d 505 (NJ 1985).
8 “California Counties and Cities Announce Groundbreaking $305 Million Settlement of Landmark Lead Paint Litigation,” The People of the State of California v. Conagra Grocery Products Company, et al., Case No., 1-00-CV-788657 (July 17, 2019).
9The large number of persons employed in occupations with frequent exposure to infection and disease underscore the importance of all workplaces developing risk response plans for COVID-19. Given the proportion of the United States workforce exposed to disease or infection at work, this analysis also serves as an important reminder that the workplace is a key locus for public health interventions, which could protect both workers and the communities they serve. Baker MG, Peckham TK, Seixas NS (2020) Estimating the burden of United States workers exposed to infection or disease: A key factor in containing risk of COVID-19 infection. PLoS ONE 15(4): e0232452. https://doi.org/10.1371/journal.pone.0232452 ;
“….airborne transmission of COVID-19 is possible, and that infectious aerosol may be produced without coughing.” The Infectious Nature of Patient-Generated SARS-CoV-2 Aerosol, medRxiv preprint doi: https://doi.org/10.1101/2020.07.13.20041632, this version posted July 20, 2020.
11 Enforcement Policy for Face Masks and Respirators During the Coronavirus Disease (COVID-19) Public Health Emergency (Revised); Guidance for Industry and Food and Drug Administration Staff, May 2020, https://www.fda.gov/media/136449/download
12 Klompas M, Baker MA, Rhee C. Airborne Transmission of SARS-CoV-2: Theoretical Considerations and Available Evidence. JAMA. Published online July 13, 2020. doi:10.1001/jama.2020.12458
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National Suicide Prevention Lifeline: We can all help prevent suicide. The Lifeline provides 24/7, free and confidential support for people in distress, prevention and crisis resources for you or your loved ones, and best practices for professionals. For help call: 1-800-273-8255.
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14 Terrorism Risk Insurance Act of 2002, Pub.L. 107–297, Nov. 26, 2002, 116 Stat. 2322. 15 USCA § 6701, Pub.L. 109–144, §§ 2 to 8, Dec. 22, 2005, 119 Stat. 2660 to 2662, Pub.L. 110–160, §§ 2 to 5, Dec. 26, 2007, 121 Stat. 1839, Pub.L. 112–158, Title V, § 502(e)(2), Aug. 10, 2012, 126 Stat. 1260, Pub.L. 114–1, Title I, §§ 101 to 106, 107(e), 111, 112, Jan. 12, 2015, 129 Stat. 3, 8, 10.
15 COVID Risk Level Dashboard, (Harvard Global Health Institute, Harvard's Edmond J. Safra Center for Ethics, Rockefeller Foundation, CovidActNow, Covid-Local, CIDRAP) Live Updates), https://globalepidemics.org/key-metrics-for-covid-suppression/
16 Coronavirus (COVID-19) - The workers' compensation community should support TTSI, https://workers-compensation.blogspot.com/2020/07/coronavirus-covid-19-workers.html, July 20, 2020.
Over half of U.S. companies plan virus contact tracing for employees: survey, Reuters, 7/22/20. https://www.reuters.com/article/us-health-coronavirus-usa-contacttracing/over-half-of-u-s-companies-plan-virus-contact-tracing-for-employees-survey-idUSKCN24N2SN?utm_source
17 “We need to test all people with symptoms and their contacts, which means at most 3% of our tests should turn out positive. We need to identify as many infected as possible, and 70% to 90% of their contacts, to isolate or quarantine them. If we do all of that really fast (within a day or so), it might be enough to control the epidemic. We should hire lots of people to do that, and also use technology.” Thomas Pueyo, Coronavirus: How to Do Testing and Contact Tracing - medium.com https://medium.com/@tomaspueyo/coronavirus-how-to-do-testing-and-contact-tracing-bde85b64072e
18 Insurance companies battle their clients over the coronavirus, AXIOS, July 23, 2020. https://www.axios.com/insurance-companies-vs-business-coronavirus-946b8cd3-ac29-401f-b548-98ef7dcaa0c1.html ;