North Dakota built a $1.2 billion surplus while injured workers ran out of lawyers, benefits, and time.
Oak Reile slipped while delivering supplies in 2020, broke two vertebrae, and became paralyzed from the armpits down. The state agency denied coverage for his depression on the ground that it was not a physiological effect of the injury. He and his wife fought for months over a $150 wheelchair cushion and later over two psychotherapy visits a month, costing about $250 each. They took that fight to the state Supreme Court and won.
Days later, at the agency’s request, a state senator added language to a bill closing the door on future claims for the psychological effects of workplace injuries. The legislature passed it. That is not a safety net. It is a tollbooth.
The “grand bargain” was supposed to be simple: workers give up the right to sue, and employers provide medical care and lost wages when the job breaks them. North Dakota kept the first half and put the second behind a shrinking line of lawyers, a $7,455 fee cap, and a legislature filled with people who pay premiums to the agency they regulate.
The result is a system that can approve 90% of initial claims and still leave injured people stranded after the first denial. It can report a 4.22 customer-satisfaction score out of 5 while Jesse Jerger, after fracturing his elbow and suffering permanent nerve damage, gives up because two lawyers refuse his case. He cashed out a life-insurance policy and drained his savings to pay the bills.
The agency says the system recovered from a $240 million deficit in the 1990s, now holds $2.3 billion in assets, and has returned about $1.8 billion to North Dakota businesses over 20 years. It paid $40 million in lost wages last year, down from $79.4 million in 2016. Average payments on active claims fell from $4,600 to about $4,100.
The surplus is real. So is the missing care. It is the same arithmetic seen when settlement payouts arrive without full recovery for survivors: money can move through a system while the injured person remains stuck inside the loss.
This is the two-tier law in its plainest form. A worker with a permanent injury must find counsel on a contingency fee, against an agency with money, staff, and the power to help write the next rule. The business side gets refunds, discounts, and the lowest premiums in the nation—50 cents per $100 of payroll. The injured side gets a hearing fee that may not cover the lawyer’s time.
The system does not need to reject every claim to defeat its purpose. It only needs to make the next appeal too costly to pursue. Hearings requested by injured workers and employers fell from 304 ten years ago to 108 in 2025.
The agency calls the system “working as well as it’s ever been designed to work.” Designed is the operative word. Soon there may be no one left to appeal its designs.
Dan Phillips receives more than 25 calls a week and accepts about one case in six. He earned $14,595 for Reile’s administrative hearing, district-court case, and Supreme Court appeal—about half the value of his time.
The other lawyer is 68. Phillips is 67 and hopes to retire in three years. Then there will be no attorneys in North Dakota handling workers’ compensation cases.
The law binds the injured. It protects the fund.