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Massachusetts SJC Upholds Workers’ Comp Insurer’s Refusal To Fund Marijuana Treatment

In one of the first Massachusetts appellate decisions to grapple with the impact of the legalization of marijuana, the Supreme Judicial Court ruled that a workers’ compensation carrier cannot be required to reimburse an employee for medical marijuana expenses used to treat a work-related injury.

In 2012, Massachusetts voters approved a law in that legalized the use of medical marijuana for treatment purposes. While the law generally provides that qualifying patients and health care providers cannot be penalized for the use of medical marijuana, there are a number of limitations. Under the federal Controlled Substance Act, marijuana is classified as a schedule 1 drug and is considered to have no current accepted medical use. Regardless of its status at the state level, it remains federal offense to manufacture, distribute, or possess marijuana. Similarly, it is still a federal offense to aid or abet the possession of marijuana.

In Wright’s Case, the employee suffered a work-related knee injury in 2010, which led to surgery, post-operative complications, and permanent and total disability. In 2013, he began using medical marijuana to treat his chronic pain, and later sought reimbursement from his employer’s workers’ compensation insurer.

Although an administrative judge credited the employee’s testimony about the positive benefits he experienced, he concluded that the carrier could not be compelled to pay for a treatment which was illegal under Federal law. He also concluded that the state statute precluded an order requiring the carrier to reimburse the employee. On appeal, the reviewing board affirmed, holding that the carrier could not be forced to reimburse the employee, where such conduct might put it at risk of Federal prosecution.

The SJC agreed, holding that neither the plain language of the state law nor the broader regulatory environment pertaining to medical marijuana required the carrier to reimburse the expenses. The Court relied on language in the state statute expressly stating that the law does not require “any health insurance provider” to reimburse any person for medical marijuana expenses. It ruled that a workers’ compensation carrier is a “health insurance provider” for purposes of the statute, and acknowledged that the ballot measure approved by voters was carefully crafted to eliminate a carrier’s involvement in the medical marijuana market and avoid the possibility that an insurer might be subject to Federal prosecution.

The SJC’s decision becomes part of the complex and sometimes contradictory legal landscape which continues to develop in response to the increasing use of medical marijuana. It is consistent with a decision by the Maine Supreme Court (Bourgoin v. Twin Rivers Paper Co., LLC) ruling that an insurer cannot be ordered to subsidize such treatment, but contradicts a ruling by Connecticut Review Board (Petrini v. Marcus Diary, Inc.) ordering an insurer to pay for medical marijuana as “reasonable or necessary treatment.” As the law in this dynamic area continues to evolve, it is essential for employers and insurers to keep up to date with the latest developments at both the state and federal level. Please contact us if you have any questions.

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