New Jersey Judge Rules Workers’ Comp Must Pay for Medical Marijuana

The Superior Court of New Jersey affirmed a workers' compensation judge's ruling that required an employer to reimburse its employee for the employee’s prescription use of medical marijuana.
By: | January 20, 2020

Medical marijuana has had yet another day in court.

This time, however, its legality was not on the stand; instead, the question of who should pay for the drug if an injured worker is prescribed medical marijuana after a workplace injury was decided.

In this case, the appellate division of the Superior Court of New Jersey affirmed an order by a state workers’ compensation judge that required an employer to reimburse its employee for the employee’s use of medical marijuana prescribed for chronic pain following a work-related accident.

Some Background

In 2001, a worker for M&K Construction was injured after a construction vehicle carrying concrete dumped its contents onto him. The worker experienced lower back pain that radiated down both legs, which he described as “shooting and stabbing pain.” He filed for workers’ compensation through his employer, but M&K denied coverage, claiming that it was further investigating the incident.

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In the meantime, the injured worker, using his own health care insurance, visited a chiropractic doctor, who referred him for diagnostic testing. An MRI revealed a “large L5-S1 central disc herniation causing central canal stenosis” and “annular disc bulging at L4-5.”

The worker was told to see a neurosurgeon.

However, due to his injuries, he was unable to work, and the health insurance he held through M&K was terminated after the worker left his job.

Over the course of the next 15 years, this injured worker experienced “chronic debilitating pain.” He was prescribed a litany of pain meds — Oxycontin, Oxycodone, Valium, Lyrica and others — and went through several procedures, including a laminectomy and decompression of several nerve roots in his lumbar spine; a two-level lumbar fusion; and he wore a back brace for a year and underwent physical therapy.

Workers’ comp did not pay for anything, and nothing the worker did seemed to help alleviate the pain.

In April 2016, the injured worker met with Dr. Joseph Liotta, a board-certified hospice and palliative care physician who was also certified by the state of New Jersey to prescribe medical marijuana.

In a means to find an alternative to opioids and to help this patient through his pain, Dr. Liotta determined the worker was a candidate for the state medical marijuana program. In New Jersey, medical marijuana was legalized in 2010.

By May 2016, the worker had shown improvements: He was sleeping better, he had stopped taking Oxycodone and the marijuana itself had provided the worker with some relief from his pain.

Later that same year, in November, the worker and his former employer finally had their say in court. M&K agreed to cover most of the worker’s medical bills, reimbursement for out-of-pocket medical expenses, temporary disability benefits and third-party lien credits. The issues remaining for the compensation judge’s determination were the award of permanent disability and future medical treatment.

Two years later, the judge ruled in favor of the worker, stating that his injuries were in fact a direct cause of the work accident. He also noted that because the worker had been introduced to the medical marijuana program, he had been able to quit opioids altogether and had been opioid-free for several years because of it. The judge concluded the benefits of medical marijuana were superior to the use of opioids and the continued use of medical marijuana was in the worker’s best interests.

He ordered M&K to cover the cost of the medical marijuana for the worker through workers’ comp.

Appeals Court

M&K appealed the judge’s ruling.

The appeals court had to consider whether the workers’ compensation judge could order an employer to reimburse the cost of medical marijuana prescribed to an injured employee.

M&K argued that, because marijuana is a Schedule 1 drug under federal law, any payment it made toward the worker’s prescription would be considered aiding and abetting the possession of an illegal substance.

It further argued that the Controlled Substances Act, which deems it a crime to manufacture, possess or distribute marijuana, preempts the New Jersey Compassionate Use Medical Marijuana Act. Because of this, M&K said, any decision made on the medical marijuana would not be able to comply with both statutes.

But the court viewed it differently.

“Because we conclude the order does not require M&K to possess, manufacture or distribute marijuana, but only to reimburse petitioner for his purchase of medical marijuana, we discern no conflict between the CSA and MMA,” read the court opinion. “Furthermore, M&K’s compliance with the order does not establish the specific intent element of an aiding and abetting offense under federal law…

“Therefore, it is not excluded under the MMA from reimbursing the costs of medical marijuana.”

It ruled in favor of the worker. M&K’s workers’ compensation will be on the hook for medical marijuana reimbursement.

What This Could Mean

This case sets a precedent for others that are likely to follow.

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Since the legalization of both medical and recreational marijuana, workers’ compensation professionals have been wondering just exactly how cannabis will impact the industry. The New Jersey court makes it clear: If the medical marijuana is proven to help reduce pain in an injured worker and shows a positive impact — like weening a person off highly dangerous opioid drugs — then it is possible that comp payers will be responsible for payment.

Some states have language within their workers’ compensation acts that explicitly prohibits medical marijuana payments. For example, Illinois’ act states: “Nothing in this Act may be construed to require a government medical assistance program, employer, property and casualty insurer, or private health insurer to reimburse a person for costs associated with the medical use of cannabis.”

Other states, however, are embracing the idea of medical marijuana in the hopes that it could be that ever-elusive solution to the growing opioid epidemic.

Maine, New York, Maryland, Vermont and, yes, New Jersey have all considered legislation that would authorize the reimbursement of medical marijuana in workers’ compensation. &

Autumn Heisler is the content strategist at Risk & Insurance®. She can be reached at [email protected]

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