A Capehart Scatchard Blog

Proposed Bill to Require Carriers to Pay for Costs of Medical Marijuana Passes Committee While the New Jersey Supreme Court is Scheduled to Hear Oral Arguments on the Issue

By on October 30, 2020 in Legislation with 0 Comments

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

About the Author

About the Author:

John H. Geaney, a shareholder and co-chair of Capehart Scatchard's Workers' Compensation department, began an email newsletter entitled Currents in Workers’ Compensation, ADA and FMLA in 2001 in order to keep clients and readers informed on leading developments in these three areas of law. Since that time he has written over 500 newsletter updates.

Mr. Geaney is the author of Geaney’s New Jersey Workers’ Compensation Manual for Practitioners, Adjusters & Employers. The manual is distributed by the New Jersey Institute for Continuing Legal Education (NJICLE). He also authored an ADA and FMLA manual as distributed by NJICLE. If you are interested in purchasing the manual, please contact NJICLE at 732-214-8500 or visit their website at www.njicle.com.

Mr. Geaney represents employers in the defense of workers’ compensation, ADA and FMLA matters. He is a Fellow of the College of Workers’ Compensation Lawyers of the American Bar Association and is certified by the Supreme Court of New Jersey as a workers’ compensation law attorney. He is one of two firm representatives to the National Workers’ Compensation Defense Network. He has served on the Executive Committee of Capehart Scatchard for over ten (10) years.

A graduate of Holy Cross College summa cum laude, Mr. Geaney obtained his law degree from Boston College Law School. He has been named a “Super Lawyer” by his peers and Law and Politics. He serves as Vice President of the Friends of MEND, the fundraising arm of a local charitable organization devoted to promoting affordable housing.

Capehart Scatchard is a full service law firm with offices in Mt. Laurel and Trenton, New Jersey. The firm represents employers and businesses in a wide variety of areas, including workers’ compensation, civil litigation, labor, environmental, business, estates and governmental affairs.

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