Workers’ Compensation vs. Nonsubscribers

As business owners in the state of Texas, we are fortunate to have options when it comes to choosing workers’ compensation insurance in that we have the option to opt out of the state’s system and become a “nonsubscriber.” Employers can choose to implement their own insurance programs that provide medical benefits, wage replacement benefits, disability benefits and death benefits. In the past, this has been a much more affordable option and approximately 44% of Texas businesses operate as non-subscribers today.

However, alternative coverages and accident policies are not exact substitutes for workers’ compensation. Since “tort reform” in 1993, the cost of workers’ compensation insurance has decreased dramatically, many times bringing the cost to about the same as non-subscriber plans. There are many advantages associated with workers’ compensation and you could most likely benefit by revisiting your options when it comes to workers’ compensation and accidental insurance.

As a non-subscriber, you forfeit your common-law defenses if sued because of a work-related injury, meaning, as an employer, you cannot argue that the employee’s negligence contributed to the accident or that the employee knew the risk of injury and voluntarily assumed it. Furthermore, the court could order you to assume legal fees for the employee as well as compensation for suffering and punitive damages. Employers who subscribe to the state’s workers’ compensation program are protected by the Texas Workers’ Compensation Act which prevents employees from suing.

View the following chart provided by the Texas Department of Insurance to compare the various coverage types:

Coverage Comparison

Workers´ Compensation “Alternative” Policy Unauthorized Policy No Coverage
Who determines benefit levels? Texas law Court Court Court
Who pays medical and lost-income benefits? Insurance carrier Insurance company up to policy limits; employer pays rest Depends on the policy Employer
Who pays employer’s legal fees? Insurance company Governed by policy Depends on the policy Employer
Are benefits protected by a guaranty association? Yes Limited No No
Can aninjured worker win judgments for pain and suffering and punitive damages? No Yes, up to certain limits Yes, up to certain limits Yes, up to certain limits

ERA is a professional employer organization that provides workers’ compensation coverage to its client companies. If you have any questions about workers’ compensation or what we can do to assist you, please feel free to contact us at (214)739-0695 or visit our website at www.erapeo.com.

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Maximize Your FSA Before 2012

As the year end approaches, we want to offer some suggestions to you about how to effectively utilize the funds still remaining in your flexible spending account, or FSA. Unlike a health savings account, the funds in your FSA cannot be carried over to the next plan year, so it is best to use them before your current plan year expires.

1. There is a substantial list of eligible expenses that can be purchased with your FSA, or that could potentially qualify for reimbursement if you have already purchased these items. Please note, this is a sample of common items and is not a complete list. Please check with your FSA provider first for a complete list of eligible expenses.

  • Acne Treatment Proactive, Stidrex, Clean & Clear Eligible
  • Acupuncture
  • Ambulance
  • Bandages Elastic, Gauze Pads, Band Aids
  • Birth Control Pills
  • Birthing Classes
  • Blood Pressure Monitoring Devices
  • Carpal Tunnel Wrist Supports
  • Chiropractors
  • Co-Insurance Amounts
  • Contact Lenses, Materials & Equipment
  • Contraceptives
  • Co-Payments
  • Crowns, Dental
  • Crutches
  • Deductibles
  • Dental Care Toothache Relief, Temporary Filling, Denture Adhesives
  • Diabetic Supplies
  • Ear Care, Ear Drops, Ear Wax Removal
  • Egg Donor Fees
  • Eye Examinations
  • Fertility Treatments
  • Adhesive Pads, Band-Aids
  • First Aid Kits
  • Flu Shots
  • Gambling Problem Treatment
  • Genetic Testing
  • Guide Dog: Other Aid Animals
  • Hearing Aids & Its Batteries
  • Immunizations
  • Infertility Treatments
  • Insulin
  • Laser Eye Surgery LASIK
  • Medical Alert Bracelet or Necklace
  • Medical Records Charges
  • Mileage for Medical Appointment Expenses for Transportation Primarily for & Essential to Medical Care
  • Nasal Strips or Sprays
  • Nicotine Gum or Patches Nicoderm, Nicorrett Eligible
  • Occlusal Guards to Prevent Teeth Grinding
  • Oxygen
  • Sleep Aids Tylenol PM, Sominex, Unisom
  • Smoking Cessation Medications Patches, Gums
  • Stomach/Digestive Relief Pepto-Bismol, Imodium, Colace, Lactaid
  • Tooth & Mouth Pain Relief Oragel, Anbesol
  • Vitamins
  • Walkers
  • Wheelchair
  • X-ray Fees

2. If you have any receipts for health care related expenses or dependent care related expenses, be sure to submit them as soon as possible in order to be reimbursed. This will help you verify how much you have left in you FSA account.

3. If you regularly purchase medical supplies that are eligible to purchase with your FSA, you can stock up on them before your plan year expires with your leftover funds.

4. Make sure you and your family members are caught up on all doctor appointments. Your FSA funds can often be used toward your co-pay and coinsurance at your physician, dentist and optometrist, as well as some specialty doctors as long as they are listed on your eligible expenses list.

5. Make sure you and your family members are up to date on your vaccinations, including the flu shot.

6. As always, keeping up with your wellness is an essential step to keeping your medical expenses to a minimum. Weight loss counseling and methods to help you quit smoking are eligible expenses for your FSA, as long as you have a doctor’s note of medical necessity.

If you have questions about any of these items, please feel free to contact your health care experts at MedCon Benefit Systems Group, Inc. (214)739-5215.