Hailed as "the Grand Bargain" when it was introduced in America over 100 years ago, workers' compensation was meant to shield employers and employees alike from the full consequences of workplace injuries. The deal was that injured employees couldn't sue their employers no matter how negligent, and employers had to provide some compensation, though less than a court might have awarded, even to employees whose injuries didn't stem from their negligence. Both parties were supposed to come out ahead in the long run by avoiding wasteful lawsuits, making the employer's liability losses more predictable and manageable, and ensuring that workers weren't always one accident away from poverty.

But after a century of corrupt administration and failure to adapt to the modern realities of private health insurance, managed care, and medical privacy rights, the Grand Bargain has become a Grand Rip-Off for workers. Getting hurt at work in America a century ago meant getting medical care you couldn't have afforded on your own, paid for by your employer. Today it means losing access to your private health insurance benefits for treatment of that injury, and being forced to settle for whatever medical care your employer or his insurer is willing to approve. There are no rules to ensure competently managed care because managed care was unfathomable in the early 1900's, when medical science was basic and doctors did all they could for you. What's more, workers' compensation benefit providers have succeeded in evading legal requirements imposed on every other insurer and health care provider in America for protecting the privacy of your electronic medical records--another thing that didn't exist 100 years ago.

The game has changed in other ways that give workers not just more to lose, but also less to gain. As America's first social insurance program, workers' compensation was once the only thing standing between badly injured workers and the poorhouse. Today we have Social Security and Medicare to fall back on, greatly reducing the value of workers' compensation to employees.

Meanwhile, it's a Grander Bargain than ever for employers, who still can't be sued by their employees in an era when lawsuits are much more common and more lucrative than they were a century ago, and it's a profitable deal for insurers. Workers' compensation administrators keep the game going by honing an image of themselves as benevolent caretakers of injured workers, and of injured workers as lying, cheating thieves who are trying to take advantage of their generosity. Nothing could be further from the truth.