Fighting drug and alcohol abuse sometimes pays in cold, hard cash.
Several insurance companies have started offering premium reductions or financial incentives to customers that launch substance-abuse programs.
And eight states - Alabama, Arkansas, Florida, Georgia, Ohio, Mississippi, Tennessee and Washington - are going further by making premium discounts part of the law for those companies.
To gain a 5-8 percent annual discount on workers' compensation rates, companies in those states must have a written policy requiring pre-employment, reasonable-suspicion and post-accident screening. They also must perform follow-up tests after a worker tests positive for drugs or alcohol, said Nancy Delogu, counsel for Washington-based lobbying group Institute for a Drug-Free Workplace.
``That's the gold standard,'' Delogu said. ``If companies do everything right, they get a discount.''
South Carolina and Virginia also mandate insurance-discount programs. However, a company's written policy is not specified by state, meaning that insurance carriers can tell companies what they need to do to gain a discount, Delogu said.
In Ohio, employers can gain as much as a 20 percent discount just by offering random testing for all workers, she said.
Other states are moving forward with other legislation. In January, Arizona signed into law a measure allowing insurance carriers to offer a 5 percent premium credit to employers that test for substance abuse.
Arizona businesses are particularly hard hit by drug trafficking, said Susan Jones, executive director of Phoenix-based nonprofit group Drugs Don't Work in Arizona. Some dealers even carry lists of those companies that test for drug use, so they can advise their clients where not to apply for jobs.
So the state protects employers conducting random tests from being sued for privacy-rights violations. And, treatment centers and employee assistance programs are encouraged to offer discounts to those companies that test.
A giveback on workers' compensation insurance can motivate companies to attack the problem, Jones said.
``The thinking is that if employers add programs so their business is not endangered by a worker who does drugs, their workers' comp premiums should decline,'' Jones said. ``Workers' comp is not designed to protect willful negligence on the part of an employee.''
And even in states where premium discounts are not the law, a few private insurers have taken up the cause. In Wisconsin, injection molder Engineered Plastics Corp. has received $15,000-$20,000 in dividends reimbursed so far this year from its insurance carrier.
The reason: The company has lowered its accident rate by enforcing a rigorous testing program.
``People will think twice here,'' said Deb Bristoll-Radder, president of the Menomonee Falls, Wis.-based company. ``It's not a witch hunt, but an opportunity to help someone with a problem.''
The workers' compensation carrier for Engineered Plastics, United Hartland Inc. of New Berlin, Wis., rewards companies for substance-abuse policies. Since 1994, the firm has given back about $7 million to companies in premium dividends, said Paul Hingtgen, United Hartland vice president of underwriting and risk management services.
For the six companies in the plastics industry that United Hartland insures, the number of injury claims has decreased 13-69 percent since substance-abuse programs were started, he said.
Hingtgen said he could not understand why more insurance companies do not offer similar premium reductions.
``We've seen all the Cheech and Chong movies, where they're spaced out and have no idea what's going on,'' Hingtgen said. ``It just takes a fraction of a second for someone to drift off in a plant before they are injured or killed.''
But companies must be able to afford to create programs before they can collect dividends. The Small Business Administration offers grants to local organizations that help businesses launch such programs.
``Small businesses don't have the financial or human resources to set up drug-free-workplace programs,'' said Joan Bready , director of the Washington-based Paul D. Coverdell Drug Free Workplace Program at the SBA. ``So drug and alcohol abusers tend to go to small business for employment. The abusers know where they don't test.''
Businesses served by SBA grant money must have 500 or fewer employees. One such group, the North Texas Small Business Development Center, fights an uphill battle with companies that believe testing programs are too expensive, said technology director Jim Berish.
The Dallas group travels to 49 Texas counties to get across a different message. It passes out sample drug-testing kits and helps companies avoid early struggles with creating programs. In its second year, the group has helped 42 companies out of more than 200,000 businesses start programs, Berish said. It has much work ahead, he said.
``We're trying to overcome barriers and take a lot of the headaches away,'' Berish said. ``Before today, there was a lot of missionary work done by providers but none targeted small business.''