In recent years, companies have used that freedom to severely curtail long-standing benefits.

Two states, Texas and Oklahoma, already allow employers to opt out of state-mandated workers’ comp. In Texas, the only state that has never required employers to provide workers’ comp, Walmart has written a plan that allows the company to select the physician an employee sees and the arbitration company that hears disputes. The plan provides no coverage for asbestos exposure. And a vague section of the contract excludes any employee who was injured due to his "participation" in an assault from collecting benefits unless the assault was committed in defense of Walmart’s "business or property." It is up to Walmart to interpret what "participation" means. But the Texas AFL-CIO has argued that an employee who defended himself from an attack would not qualify for benefits.

"It creates a race to the bottom."

A 2012 survey of Texas companies with private plans found that fewer than half offered benefits to seriously injured employees or the families of workers who died in workplace accidents. (The state plan, which Texas companies can follow on a voluntary basis, covers both.) Half of employer plans capped benefits, while the state plan pays benefits throughout a worker’s recovery.

Businesses can save millions of dollars by opting out and writing plans with narrow benefits, putting pressure on their competitors to do the same. "It creates a race…