6 States Require Workers’ Comp Insurers to Reimburse Medical Marijuana. Is Your State One of Them?

This guide can help you understand the regulations in your state.
By: | November 9, 2021

Ever since states started passing legislation legalizing marijuana for medical use, workers’ compensation insurers have been asking the question, is it covered by an employee’s workers’ comp benefits?

For a long time, the answer was ‘no.’ As a Schedule 1 Drug that isn’t regulated by the Food and Drug Administration, insurers have been hesitant to reimburse medical marijuana prescriptions in the past.

Now, as the drug becomes more widely legalized in the U.S., some states are allowing workers’ comp insurers to reimburse injured workers who use the drug in their treatment. Others are expressly prohibiting reimbursement for medicinal cannabis. The vast majority, however, still have no regulations either way.

A recent report from the National Institute for Occupational Safety and Health (NIOSH) breaks down where cannabis is reimbursable in workers’ comp, where it’s not and how employers should conduct themselves in states where the law doesn’t say either way.

The Six States Where Medical Marijuana Is Reimbursable

On the whole, 36 states and Washington D.C. have laws that make marijuana use legal for qualifying medical conditions.

Of those, six states are on record as requiring workers’ comp insurers to reimburse medical marijuana. They are Connecticut, Minnesota, New Hampshire, New Jersey, New Mexico and New York.

The majority of these states allow medical marijuana reimbursement due to court orders — New Jersey, New Hampshire, New Mexico and New York. Minnesota allows marijuana reimbursement in workers’ comp due to a state general administrative rule and Connecticut allows it because of a state workers’ compensation administrative panel decision.

While these states allow reimbursement, that doesn’t mean it’s a free-for-all.  An injured employee must be using the drug in accordance with state regulations surrounding medical cannabis access for marijuana to be reimbursed through a workers’ compensation policy.

To meet these requirements, workers’ have to have a qualifying condition. Many of which, including most cancers, multiple sclerosis, epilepsy, glaucoma, aren’t typically seen in workers’ comp.

Even when a worker has a qualifying condition, they may have to prove that they haven’t had success with other treatments. With chronic pain, for example, patients have to provide medical evidence that pain management strategies like surgery, physical therapy and prescription medications weren’t effective for their condition before cannabis can be prescribed.

States Where Medical Marijuana Reimbursement Is Prohibited 

An equal number of states bar medical marijuana reimbursement in workers’ compensation. A mix of court decisions, state legislation and administrative rules have resulted in these prohibitions.

In Massachusetts and Maine, cannabis legislation is prohibited because state courts have decided that federal law supersedes state medical access. Consequently, workers’ comp insurers cannot reimburse a drug that is not FDA-approved.

Similarly, state administrative rules governing workers’ comp in Ohio and Washington bar reimbursement for marijuana because the drug is not FDA-approved.

State legislation in North Dakota and Florida bans the reimbursement of medicinal cannabis in workers’ comp.

What if You Live in One of the Other States?

The twelve states that either explicitly allow or bar medical marijuana reimbursement are in the minority. The other 24 states either don’t require the drug to be reimbursed or are entirely silent on the matter.

Arizona, Arkansas, California, Colorado, Delaware, Illinois, Louisiana, Michigan, Montana, Nevada, Oregon, Pennsylvania, Utah and Vermont don’t forbid medical marijuana reimbursement, but they’ve said that it’s not required for workers’ comp insurers.

Alaska, Hawaii, Maryland Mississippi, Missouri, Oklahoma, Rhode Island, South Dakota, Virginia and West Virginia have been silent on the matter. Washington D.C. also does not have any clear guidance.

In these cases, workers’ comp insurers may be wondering what action they should take?

If you’re in a state where it’s not required, insurers can decide for themselves whether or not to reimburse medical marijuana. In states without policies, insurers can also elect not to cover the drug, but they could be susceptible to court challenges since their states have no guidance either way.

As always, states should continue to watch for changes to laws and regulations, especially since there are rumblings about a federal change in marijuana’s status as a Schedule 1 drug. &

Courtney DuChene is an associate editor at Risk & Insurance. She can be reached at [email protected]

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