Pa. Supreme Court Requires Employer to Reimburse Injured Worker’s CBD Oil Expenses

A workers’ compensation lawyer’s work-related back injury

Mark Schmidt, a workers’ compensation attorney and partner at Schmidt, Kirifides and Rassias, PC, in Media, Pa., suffered a back injury in April 2017 while loading files into his trial bag. Schmidt was diagnosed with aggravating a preexisting degenerative disc disease in his lumbar spine.

To manage this work-related injury, Schmidt initially received pain management treatment, including prescriptions for Oxycodone and OxyContin. Because prolonged sitting made Schmidt’s pain worse, his physician suggested increasing his opioids dosages. Schmidt was concerned that higher doses could impair his ability to effectively represent clients, but was unwilling to risk an extended recovery period from surgery.

After Schmidt tried other non-surgical interventions, such as aqua therapy and injections, his doctor prescribed CBD oil in lieu of increasing his OxyContin and Oxycodone dosages. This treatment successfully alleviated Schmidt’s pain. Despite his doctor prescribing the treatment, and its effectiveness, Schmidt’s employer refused to reimburse him for his out-of-pocket expenses associated with the CBD oil. The law firm argued CBD oil was not a recognized pharmaceutical medication.

The workers’ compensation claim

In October 2019, Schmidt filed a penalty petition claiming his law firm violated the WCA by failing to reimburse his out-of-pocket costs for the CBD oil he used to treat his work-related injury. A Workers’ Compensation Judge (WCJ) found the treatment reasonable and necessary, noting it helped manage pain, reduced reliance on opioids, and delayed surgery. The WCJ accepted expert testimony classifying CBD oil as a dietary supplement (as opposed to an over-the-counter drug) and ruled it qualified as a medical “supply” under the WCA.

The Workers’ Compensation Appeal Board (WCAB) reversed, holding that Schmidt failed to meet legal prerequisites to trigger reimbursement and CBD oil could not be deemed reasonable or necessary under the WCA because of the FDA’s position that its safety and efficiency haven’t been established.

On appeal, a divided en banc Commonwealth Court reversed the WCAB in November 2023, holding that CBD oil is a compensable “medicine” and “supply” under the WCA. The court also ruled, in response to his law firm’s argument, that Schmidt was not required to submit the same billing forms required of treatment providers to obtain reimbursement for the costs of medicine and supplies to treat his work injuries. His firm appealed the decision to the Pa. Supreme Court.

The Pa. Supreme Court rules employers must pay for injured workers’ CBD oil use if it is part of a health care provider’s treatment plan

In a unanimous opinion issued on March 20 and written by Justice Kevin Brobson, the Pa. Supreme Court held the WCA obligates employers to cover the cost of any item used to treat a work-related injury, as long as it’s included in the health care provider’s treatment plan for that injury.

Departing from the statutory interpretation exercise that the Commonwealth Court and WCJ undertook earlier in the case to scrutinize the meaning of the terms “medicines” and “supplies” as those terms are used in Section 306(f.1)(1)(i) of the WCA, the court began its analysis by explaining that it was “unconvinced that [it] must consider those terms independently and fit CBD oil into either category in order for an employer to be responsible to pay for it pursuant to this section.” The court added that because “an employer is responsible for payment for both ‘medicines and supplies,’ ascribing separate meanings to the individual terms would present a distinction without a difference.” Thus, the court looked at CBD oil in relation to “medicines and supplies” instead of whether it was a “medicine” or a “supply.”

Relying on the statutory language of Section 306(f.1)(1)(i), the court defined “medicines and supplies” as “any item that is part of a health care provider’s treatment plan for a work-related injury.” It further explained that “the proper inquiry to resolve whether an employer is responsible for payment of a certain item under [Section 306(f.1)(1)(i)] is whether a health care provider prescribes the item as part of the treatment plan associated with the work-related injury . . . .”

Taking this approach, the court said it (and presumably other courts) can separate itself from the process by which a licensed physician, using his or her professional judgment, determines that a certain item is a component of a treatment plan for a work-related injury. In other words, the court will “refrain from stepping into the shoes of a health care provider merely because an item—i.e., here, CBD oil—might not squarely fit into the separate terms ‘medicines’ or ‘supplies.’”

In response to Schmidt, Kirifides and Rassias, PC’s, argument that CBD oil could not be considered a “medicine” or “supply” because it has not been approved by the FDA, the court held that “there is nothing in the [WCA] that requires ‘medicines and supplies’ to be regulated by the FDA.” The court added the law firm could not show that the CBD oil Schmidt purchased was illegal since CBD oil is lawfully sold over the counter in Pennsylvania.

The court concluded by holding, regarding the law firm’s technical argument, that Schmidt was not a “health care provider” under the WCA and was not required to comply with the statute’s provisions that providers must comply with before a workers’ compensation insurer is required to pay for the treatment provided.

Thus, because Schmidt’s CBD oil treatments were part of his physician’s treatment plan for his work-related injuries, the court affirmed the Commonwealth Court’s order requiring Schmidt, Kirifides and Rassias, PC, to reimburse Schmidt for those treatments he used for his injuries.

The Pa. Supreme Court blesses better pain management options for Pennsylvania’s injured workers

The opioids crisis intensified the search for safer pain management alternatives. Pennsylvania’s Office of the Attorney General (AG) has declared opioids to be the commonwealth’s top public health and public safety crisis. The AG notes on its website that “an average of 14 Pennsylvanians die every day from overdose, and based on available data the death toll will only continue to rise.”

Many individuals became addicted to opioids while undergoing treatment for work-related injuries. Though prescriptions and usage decreased after opioids’ addictive nature became clear, there became a gap in treatment, especially for conditions involving chronic pain. Injured workers, including Schmidt, were left to choose between the lesser of two evils: Go through life battling significant pain or take prescribed opioids and risk facing significant side effects and possible addiction.

Schmidt v. Schmidt, Kirifides and Rassias, PC (Workers’ Compensation Appeal Board) marks a significant development in Pennsylvania, where, by officially recognizing CBD oil as a compensable treatment for work-related injuries, the Pa. Supreme Court has opened the door wider for such treatments that can effectively alleviate pain without the high risks of addiction and dependency associated with opioids.

More broadly, the decision will have interesting ramifications for injured workers across the commonwealth. On one hand, so long as an injured worker’s physician includes a treatment as part of their treatment plan, an employer must pay for that treatment.

But on the other hand, if an injured worker pursues experimental or holistic treatments that the medical establishment has not yet blessed, meaning physicians are unlikely to approve them as part of an injured worker’s treatment plan, they likely will be unable to persuade their insurer to pay for them. We can see a world where pro-workers’ groups increase their lobbying of physicians and insurers to prescribe and cover promising new treatments so that injured workers can benefit from access to cutting-edge treatments that could make their lives better.

But for now, the Pa. Supreme Court has issued a ruling that will benefit both injured workers in the commonwealth and the commonwealth overall. Its decision allows injured workers to manage pain from work injuries through CBD-related treatments that will help them avoid incurring large medical bills because of invasive and expensive surgeries, as well as avoid relying on long-term use of addictive opioids.

In doing so, Pennsylvanians will also benefit because they will avoid bearing the brunt of the societal costs these surgeries and opioid addictions bring in the form of higher insurance premiums and higher taxes to fund programs assisting people addicted to opioids.

Frank N. Ciprero is a partner at Pond Lehocky Giordano Inc., the largest workers’ compensation and disability law firm in Pennsylvania, and one of the largest in the United States. He can be reached at fciprero@pondlehocky.com.

Ashleigh Q. Gallagher is a handling attorney at Pond Lehocky Giordano Inc., the largest workers’ compensation and disability law firm in Pennsylvania, and one of the largest in the United States. She can be reached at agallagher@pondlehocky.com.

Reprinted with permission from the April 24, 2025 edition of The Legal Intelligencer © 2025 ALM Media Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-257-3382 or reprints@alm.com.