Oklahoma Workers’ Comp Plan Called Risky

     OKLAHOMA CITY (CN) — Oklahoma officials are taking a financially unsound risk by letting state agencies buy workers’ compensation coverage that could result in over $42 million in fines, taxpayers claim in court.
     Lead plaintiff and attorney Bob Burke, of Oklahoma City, sued the state’s Office of Management and Enterprise Services in Oklahoma County on Friday. The plaintiffs representing a proposed class say OMES allows state agencies to buy coverage “with huge deductibles” from the Consolidated Workers’ Compensation Program, or CWCP, a self-insurance plan.
     “For example, workers’ compensation coverage for the Office of the Governor has a $1 million deductible,” the eight-page complaint states. “Because the appropriated budget for the Office of the Governor does not contain funds for the payment of compensable workers’ compensation claims, taxpayers are put at risk because any funds expended for compensable claims will ultimately be a liability of the state’s general revenue fund. The same harm is present for any other agency with a deductible.”
     The taxpayers claim Oklahoma is operating an “unauthorized self-insurance workers’ compensation scheme” that violates the Administrative Workers’ Compensation Act and the rules of the Workers’ Compensation Commission.
     “Because there is no legislative action specifically guaranteeing all losses under the CWCP, said program is actually operating as an unlicensed insurance company because state entities are not jointly and severally liable nor have the included agencies agreed to pay all claims and liabilities against the plan,” the complaint states. “By failing to comply with the Administrative Workers’ Compensation Act, and lawfully securing the payment of compensation, OMES has subjected taxpayers to potential fines of $1,000 per day. If each state entity is considered a separate self-insured employer, the Workers’ Compensation Commission has authority to assess fines totally more than $42 million.”
     Oklahoma further puts taxpayers at risk by allowing injured employees to sue in district court rather than present work injury claims before the commission, according to the lawsuit.
     OMES spokesman John Estus said the agency is “confident” the program is legal and that it is “expressly authorized” under state law.
     “In addition to the statutory authorization, the attorney general’s office has advised OMES that the program is legally sound,” he said. “Furthermore, the Workers’ Compensation Commission is fully aware of the state’s program and obtains coverage for its employees through it.”
     The taxpayers seek an injunction and declarations that the CWCP plan is illegal and cannot be expanded to other state agencies. Burke represents himself and the class.

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