The Supreme Court of the Commonwealth of Pennsylvania recently ruled that an employee’s use of CBD oils as part of his pain management plan falls within the definition of “medicines or supplies” and, therefore, is considered a covered expense under the Pennsylvania Workers Compensation Act – Schmidt v. Schmidt, Kirifides & Rassias, PC, 2025 Pa. LEXIS 389 (2025).

This case has far-reaching consequences both for employees who use CBD oil for pain management and other over-the-counter and nonstandard treatments as part of a physician-prescribed pain management program and their employees. The decision requires employers to refund the cost of these treatments and excludes claimants from having to follow the dictates of the Pennsylvania Workers’ Compensation Act billing requirements to obtain payment or reimbursement.

BACKGROUND:
In this matter, Mr. Schmidt, a well-known and well-respected claimant’s counsel practicing in Delaware County, injured his lower back while lifting heavy files at work. The injury he sustained was an aggravation of underlying degenerative disc disease at L4-5 and L5-S1. Mr. Schmidt continued to work, but his condition worsened. His treating physician strongly suggested back surgery. Given the poor long-term surgical outcomes of lumbosacral degenerative disc disease, Mr. Schmidt wanted to do anything he could to avoid surgical treatment. His healthcare provider, therefore, prescribed Oxycontin and other opioids as part of his treatment program. Over time, the prescription analgesic medications increased in dosage. Rather than undergo surgery or increase his opioid use, Mr. Schmidt turned to over-the-counter CBD oil as an analgesic. Mr. Schmidt’s treating physician developed a treatment plan that included CBD oil.

The claimant provided the prescription for CBD oil to the workers’ compensation carrier. He also provided proof of his out-of-pocket cost for the CBD oil. The employer refused to pay for the treatment on the basis that CBD oil is not a pharmaceutical drug. Petitions were filed.

The workers’ compensation Judge disagreed with the employer and ordered the employer to cover the treatment costs. The Workers’ Compensation Appeal Board reversed the Judge’s decision, and Mr. Schmidt appealed the matter to the Commonwealth Court.

The Commonwealth Court decided that not only was CBD oil considered a “supply” and “medicine” under the Act, but also that the claimant did not have to supply billing forms to support the bills, which are otherwise necessary under the cost containment provisions of the Act, as the claimant is not considered a healthcare provider. The employer appealed this determination to the Supreme Court of Pennsylvania.

DECISION:
The Supreme Court has decided that CBD oil is considered a “medicine” or a “supply” under 77 P.S. §531(1)(i) of the Pennsylvania Workers Compensation Act. The section in pertinent part states as follows:

“(i) The Employer shall provide payment in accordance with this section for reasonable surgical and medical services, services rendered by physicians or other health care providers, including an additional opinion when invasive surgery may be necessary, medicines and supplies, as and when needed.” 77 P.S. §531(1)(i).

The Court indicated that “medicines and supplies” refer to any item that is part of a healthcare provider’s treatment plan utilized to care for a work-related injury under the Act. If CBD oil is part of a healthcare provider’s treatment plan, then it is considered a “medicine and supply” under the Act.

The Court harshly criticized the employer’s argument, stating that the employer had lost focus on the fundamental issue before the Court and attempted to argue that CBD is dangerous and not FDA-approved. The Court scoffed at any requirement that a treatment be FDA-approved, noting that this requirement is not stated in the plain language of the Act. The Supreme Court noted that if a treatment is to be challenged, the most appropriate venue for this challenge would have been to file a Utilization Review Request. Essentially, the court indicated that the employer should have filed a Utilization Review, rather than denying the bills outright.

Furthermore, the employer erred in arguing that the claimant should have to follow the billing procedures required of a healthcare provider under the Act. The Court again dismissed this argument, stating that a claimant is not considered a provider under the Act. Conceptually, the court noted that the idea of the Supreme Court imposing duties not already explicitly stated under the Act on claimants was nonsensical. This is especially true when the Act was explicitly designed to protect injured workers. The Court stated that the cost containment provisions of the Act do not apply to non-providers.

TAKEAWAY:
According to the Court, the employer should have filed a Request for Utilization Review of the prescription of the CBD oil to challenge the bills for the same.

It may be worthwhile for workers’ compensation carriers to analyze whether CBD and THC products enable claimants to reduce or eliminate other far more expensive prescription medications, specifically for pain relief, anxiety reduction, and sleep improvement. The analysis should consider whether such protocols could, in the long term, reduce healthcare costs for employers and workers’ compensation carriers.

The next time an employer decides to challenge the use of these medications, the carrier should make that decision through the lens of a cost-benefit analysis. As it is, the case resulted in the Supreme Court issuing a decision that not only makes the use of CBD oil a court-approved treatment, but also opened the door to mandated coverage for other less efficacious treatments that are part of a treatment provider’s “treatment plan.” These will have to be fought using Utilization Review Requests going forward.

If you would like more information or need assistance with Workers’ Compensation
matters, please contact Bret Goldstein at bgoldstein@regerlaw.com or 215-495-6528.