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The New Jersey Assembly Appropriations Committee passed A1708 on October 26, 2020, setting the stage for an eventual full Assembly vote on an important piece of legislation concerning the obligation of workers’ compensation carriers and automobile insurers to pay for costs of medical marijuana. Strangely enough, this Bill is being advanced at the same time as the New Jersey Supreme Court is scheduled to hear oral arguments in the case of Hager v. M&K Construction, 462 N.J. Super. 146 (App. Div.), certif. granted, 241 N.J. 484 (2020). This case deals directly with several issues addressed in A 1708.
The proposed Assembly Bill states: “Notwithstanding the provisions of subsection a. of this section, an employer or workers’ compensation carrier or private passenger automobile insurance carrier shall provide coverage for costs associated with the medical use of cannabis . . . “ provided that the insured or the employee is a qualifying patient authorized for the medical use of cannabis.
The Bill further provides, “c. Notwithstanding any provision of the insurance policy to the contrary, if for any reason payment by the insurer to the medical cannabis dispensary is not feasible, the insurer shall remit directly to the insured the costs for any benefits associated with the medical use of cannabis upon proof of payment by the insured to the medical cannabis dispensary.”
A 1708 seems premature given that the New Jersey Supreme Court has taken certification in Hager. In this January 13, 2020 published case, the Appellate Division ruled for petitioner that he should be reimbursed by the workers’ compensation carrier for his expenses in connection with the use of medical marijuana for chronic pain. The Appellate Division addressed five separate arguments, some or all of which are likely to be addressed by the New Jersey Supreme Court. The issues addressed by the Appellate Division in Hager are set forth below:
1) Does the Controlled Substance Act (CSA) which makes it a crime to manufacture, possess or distribute marijuana, preempt the New Jersey MMA?
2) Does the MMA violate the CSA by aiding and abetting in the commission of a crime?
3) Does compliance with the court order expose M&K to the threat of federal prosecution?
4) Should a workers’ compensation insurer be treated the same under the MMA as a private health insurer?
5) Can medical marijuana be considered reasonable and necessary under the New Jersey Workers’ Compensation Act?
It would seem to make more sense and to accord appropriate respect to the judicial process for the legislature to wait for a very significant decision from our highest state court, given potential constitutional issues have been raised in this appeal.
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John H. Geaney, Esq., is a Shareholder and Co-Chair in Capehart Scatchard's Workers’ Compensation Group. Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.