Pandemic Heroes Compensation Act — Overview and Key Risks
The Pandemic Heroes Compensation Act (HR 6909) as introduced on May 15 draws heavily from the framework established for the September 11th Victims Compensation Fund (VCF). The main objective of the program is to efficiently deliver no-fault compensation to essential workers and their family members who have contracted COVID-19.
Under this proposal, the U.S. Attorney General would appoint a Special Master to develop claim procedures and a compensation methodology presumably based on the roadmap successfully implemented for the VCF.
Adapting what has worked for the VCF to the complexities of COVID-19 will not be easy. Indeed, two challenges to the fair and efficient operation of the proposed program readily emerge.
First, the proposal carries over the VCF’s offset for collateral sources of compensation. The collateral source rule is a long-standing legal concept generally prohibiting a person from receiving compensation twice for the same element of loss. Under VCF rules, workers compensation benefits are considered a collateral source reducing the award under the program.
As a practical and legal matter, viral infections such as COVID-19 are rarely compensable under state workers compensation systems because (a) benefits are not available for diseases to which the general public is exposed; and (b) the workers must establish the disease was contracted while on the job. With the intent of rushing benefits to essential workers, more than a dozen states have made the decision (at great cost) to open their workers compensation systems to COVID-19 claims by some or all essential workers. For example, California’s broad expansion of benefits is expected to cost some $1.2 billion.
The proposed program penalizes states that extended workers compensation benefits to essential workers. As currently structured, HR 6909 would fully fund medical costs and lost wages of essential workers in states where workers compensation benefits remain unavailable. Employers and insurers in any state that opens up its workers compensation system to first responders, healthcare workers or other essential workers would bear those costs. That does not seem quite right.
Second, the proposal does not carry over the VCF’s requirement for claimants to waive their right to sue. As a result, the proposal would allow a claimant to recover first under the program subject to the program’s limitations on non-economic damages (e.g., a pain and suffering award). The claimant could then try their luck with a jury to see if the award would be higher. Of course, any amounts recovered in a lawsuit duplicating the amounts previously paid by the program would go back to federal government — less the attorney’s contingency fee. This approach seems to complicate rather than streamline the efficient delivery of compensation to essential workers and their families.
A program based on the VCF can certainly be structured to fairly and efficiently support our nation’s essential workers. HR 6909 is a good first step in a public policy debate requiring a wide diversity of perspectives and experiences.
