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Could Iowa’s Cannabis and Marijuana Laws Affect Your Workers’ Compensation Case?

• Dec 20, 2021

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Legal Update by Attorneys Alison Stewart and Chris Spencer, and Law Clerk Jordan Gehlhaar

Use of medicinal cannabis is legal in narrow cases in Iowa. The Medical Cannabidiol Act was first passed in 2014 and has historically been very restrictive and slow to expand. Today’s Act provides that individuals determined by a health care practitioner to have a qualifying “debilitating medical condition” may legally obtain cannabis from a licensed dispensary. Qualifying conditions include cancer (producing certain symptoms), multiple sclerosis, seizures, AIDS, PTSD, chronic pain, or any terminal illness (producing certain symptoms). The Cannabidiol Act provides that it does not give rise to any employment law claims, which is consistent with Iowa law allowing employers to set conditions of employment. A separate provision states that workers’ compensation carriers are not required by the Act to reimburse for costs associated with medicinal marijuana use. See Iowa Code § 124E (2020).

Due to its medical relation, workers’ compensation claimants or providers may seek authorization for use of cannabis as a treatment option. This is likely to come as a petition for alternate medical care by the claimant. In the most recent Iowa case, an Iowa treating provider recommended referral to a provider who could prescribe medicinal cannabis, due to the claimant’s history of intolerance to oral medication. The employer and insurance carrier refused to authorize the referral and the claimant filed an alternate care petition under Iowa Code 85.27. The Deputy Commissioner found the refusal to be reasonable and therefore denied the alternate care.

The Deputy reasoned that:

(1) the Iowa Board of Pharmacy considered marijuana a schedule I drug with "no medicinal use,” and
(2) since marijuana and cannabis are illegal under federal law, the Defendants would put themselves at risk by paying for the treatment.

It was determined inappropriate for the Agency to recognize medicinal value prior to the Iowa Board of Pharmacy or Congress. See Presson v. Freiburger Concrete & Topsoil, Inc., File No. 5049542 (2018). This reasoning still applies today, meaning employers and insurance carriers have a reasonable basis and case law support for denying such care.

Currently, marijuana is a controlled substance in Iowa, and the possession of any amount is a misdemeanor offense in the state. Under Iowa Code Section 85.16, compensation is not allowed for work injuries caused by intoxication, if the intoxication was a substantial factor in causing the injury. This is known as the “intoxication defense” claimed by employers. It is presumed that the employee was intoxicated at the time of injury, and that the intoxication was a substantial factor in causing the injury if the employer shows a positive drug test at the time of or immediately following the injury. Therefore, if marijuana or cannabis is shown to be present in an employee’s system at or immediately after a work injury, the employee is not entitled to workers’ compensation benefits unless they overcome the presumption, a heavy burden. The closer a test is to the time of the injury, the more likely it is to be admissible. Additionally, toxicologists or similar expert witnesses are often required in these types of cases.

These sources lead to several conclusions:

(1) employers are free to adopt their own drug policies, even against legal use of medicinal cannabis;
(2) compensation may be denied for injuries caused substantially by intoxication; and
(3) Iowa law does not require workers’ compensation coverage of medicinal marijuana or cannabis.

Peddicord Wharton will continue to monitor statutory and case law on this topic.

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Peddicord Wharton Legal Updates are intended to provide information on current developments in legislation impacting our clients. Readers should not rely solely upon this information as legal advice. Peddicord Wharton attorneys would be pleased to answer any questions you may have about this update. ©2021 Peddicord Wharton. All Rights Reserved.