Nonsubscription - What Is It?
The Nonsubscriber Option provides employers the ability to create an alternative to workers’ compensation to address the needs of employees injured on the job. The State of Texas is fully informed of the decision to opt-out of the workers’ compensation program. The programs focus on compliance with state and federal laws.
Since most common approach is to implement an ERISA benefit plan that will respond to workplace injuries, these programs draw from many of the flexible, creative elements of group health and disability programs. The ERISA protections afforded to employees for their health, 401K and other benefits plans are applicable Option programs as well.
An employer may be headquartered anywhere to take advantage of nonsubscriber Option for its’ Texas employees. With Texas’s Option model, employers lose exclusive remedy. However, these programs can be very effective with a focus on safety and quality care of the worker. There is an active insurance market to address the unique liability exposure.
The Nonsubscriber Option has been available in Texas since workers’ compensation was first offered in 1913. It has grown considerably since the late 1980’s, and it is widely recognized as an established business practice. Approximately 80,000 of employers have opted out of the Texas Workers' Compensation System. Nonsubscribers include employers of all sizes, including local single-site organizations to multi-site Fortune 500 employers.
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Option is an attractive approach for employers who want to provide employees with improved outcomes, better recovery and potentially lower cost.