Workers’ compensation and mental health have always had a rocky relationship.
Both insurers and employers have traditionally sought to exclude mental health conditions (so-called “psych” claims) from workers’ compensation coverage.
The reason is that common conditions such as depression, anxiety and stress may be caused by a wide range of factors in a person’s lifestyle. And it’s therefore difficult to link them definitively to any specific incident or feature of the workplace environment.
That said, in recent years there has been a significant increase in requests for independent medical examinations for claims that include a mental health element.
Mental Health Claims Driving Increases in Workers’ Comp Costs
The widespread prescription of opioids for pain relief, growing awareness of Post-Traumatic Stress Disorder (PTSD) and the causal relationship between depression and loss of employment have all been identified as possible drivers of this increase.
Mental health investigations also tend to be more time-consuming and expensive than more routine physicals. So the net effect has been upward pressure on workers’ compensation costs.
It’s, therefore, more important than ever that employers should understand the legal framework underpinning mental health claims and the steps they can take to minimize them.
The California Legal Framework
California is one of a number of states that – at least potentially – allow recovery for “psychiatric injuries”. But these injuries are treated very differently from physical injuries. And claims for conditions such as depression and anxiety are in practice hard to establish.
It remains difficult for doctors to provide objective diagnostic confirmation of patients’ reports of depression and anxiety.
And even when a patients’ condition is not in doubt, it may well be caused by any number of reasons completely unrelated to work.
For these reasons, compensation for psychiatric injuries is only payable upon the diagnosis of a recognized mental health disorder (as defined in the American Psychiatric Association’s Diagnostic and Statistical Manual of Mental Disorders), that has required medical treatment or prevented the employee from attending work or performing their normal duties.
The extent of an employee’s psychiatric impairment is measured by applying a Global Assessment of Function (GAF) score to the California Permanent Disability Rating Scale (PDRS). A score of less than 70 is required to establish a permanent disability.
Claimants must also demonstrate that “actual events of employment” were the “predominant” (at least 51%) cause of the disorder. The attempt to apply an arbitrary numerical standard to a complex web of life events in itself makes causation difficult to establish.
But a lower standard (35-40%) is required if it can be shown that the employee in question was the victim of violence in the workplace.
Defending Psychiatric Claims
Allegations that bullying, harassment or an excessive workload has led to depression stress or anxiety are a common source of claims of psychiatric injury.
But these can be defended by establishing that the employer has been engaged in a “good faith personnel action.” These may include criticizing, reviewing, or disciplining in line with established procedures. And in some cases even demoting or transferring to other duties.
As an employer, you have fairly wide parameters in which to operate. But it should go without saying that any discrimination on grounds of race, age, disability, or gender will likely be fatal to the defense.
Get Expert Advice
It remains the case that psychiatric injuries are more difficult to establish than physical ones. But the number of claims is nevertheless increasing.
Both the legal and insurance issues involved are complex. So it’s important that you consult with both your attorneys and insurance advisers to ensure that you are as well protected as possible.
And at Brashears we specialize in providing businesses with both expert advice and precisely tailored coverages.
So if you’d like to learn more about the implications of these developments in workers’ compensation, why not call us today on 805-564-7645 or send us a message here.
Don’t suffer in silence
If you’re suffering from mental health-related issues, get help as soon as possible. Santa Barbara’s Cottage Hospital has resources online.