Photo: Tomas de Aquino via Flickr (CC by 2.0)

On March 7, 2019 the NH Supreme Court ruled that an employee’s worker’s compensation carrier was wrong to deny reimbursement for the cost of medical marijuana to an employee recovering from a work related injury.  The employee, Andrew Panaggio, suffered a lower back injury in 1991.  He received a lump sum settlement for permanent impairment in 1997 and continued to experience pain as a result of the injury.  He experienced negative side effects from prescribed opioids and was issued a NH cannabis registration card approving him for the use of medical marijuana in 2016.  He purchased the marijuana and then sought reimbursement from the worker’s compensation carrier which denied payment stating that “medical marijuana is not reasonable/necessary or causally related” to the injury.

Panaggio challenged the carrier’s refusal at the Department of Labor which upheld the insurance company’s position through two levels of review.  He then appealed to the state Supreme Court.  The court addressed two questions in its unanimous opinion:  Does state law preclude a worker’s compensation carrier from reimbursing for medically necessary use of marijuana? Can the fact that marijuana use and possession is still a crime under federal law be the basis for a carrier to deny reimbursement?

The court answered the first question in the negative relying on the plain language of RSA 126-X:3 which states only that the law does not create an independent obligation on the part of an insurance carrier to reimburse for the cost of the pot.  The court noted that the law did not in any way preclude such reimbursement, and had the legislature intended that to be the case, it could have plainly said so as did legislatures in Florida, Michigan, and North Dakota.  Conversely, he states of Connecticut, Maine, Minnesota, New Jersey, and New Mexico have found medical marijuana to be reimbursable under their state laws.

The court found the second question more problematic to answer than the first based on the lack of a clear record of the basis for the decision by the Worker’s Compensation Appeal Board.  The court stated that the board’s decision failed to articulate clearly the legal basis for its decision or to provide an adequate explanation for its conclusion that the insurance carrier “is not able to provide medical marijuana” because possession of the drug “is still a federal crime.”  Although possession of marijuana is a crime under federal law, the court found that it does not necessarily follow that an order to reimburse for the cost of the drug will not cause the insurance carrier to “possess, manufacture, or distribute” a controlled substance.

The case was remanded to the Worker’s Compensation Appeals Board for further explanation of the basis for its decision to deny the reimbursement due to federal law.  Although the court’s decision is not final, it gives a clear indication that the court would be inclined to support the reimbursement absent the showing that the insurance carrier would be in peril of federal prosecution for doing so.