Posted on May 17, 2014

Worker's Compensation: Beyond The Basics

Workers compensation 201

Workers compensation insurance provides valuable protection for employers and employees. For employers, it limits the employee's ability to file lawsuits, and for employees, it provides needed medical treatment and wage benefits when they are injured or become ill on the job.

When employers report an accident and an employee begins getting treatment, there is also a period where they earn wages for the time that they are unable to work. During this period the employee sees a medical provider who determines their level of disability so that it can be ascertained what, if any, benefits they will receive. Understanding the workers compensation insurance jargon as it relates to employee disability can be a challenge. Below find the various categories of benefits explained to bring clarity to just what it is employees receive when they cannot come back to work. Because the workers compensation laws vary in each state, the definitions give only a general overview.


Temporary Total Disability

When an employee first becomes injured and seeks medical treatment, they enter a period known as temporary total disability. In essence, this stage of a claim is their healing period. It covers when a person is unable to return to work at all, and the workers compensation insurance carrier pays them payments for temporary total disability. Most states have a waiting period of anywhere from 3 to 7 days of disability before benefits begin, and then if the temporary disability lasts longer than a couple of weeks or 14 days, then the benefit will start at the date employee is first disabled.


Temporary Partial Disability

When an employee is not totally disabled, they may be eligible for temporary partial disability. It usually applies when they can perform light duty or part time work at reduced wage amounts, and the insurer will provide compensation up to a percentage of their average weekly wage and proposed earning capacity. Most states average 2/3rds of the average weekly pay. Temporary workers compensation benefits are paid to replace lost wages or a portion and end when the employee has been treated and is able to return to work. In some cases, they may be released from temporary disability when they have reached the total improvement medically that they can, but not yet back to their pre-injury health.


Permanent Total Disability

In certain cases, employee injuries are so serious that they are completely and permanently disabled. Usually, permanent disability is associated with losing hands, arms, feet, legs or eyesight. When an injury results in permanent total disability, the worker receives 2/3rds of the average weekly wage up to the maximum payout allowed by the state workers comp laws. Benefits are reduced for those disabled employees that are entitled to Social Security Disability benefits.


Permanent Partial Disability

Some injuries are not as serious as permanent total disability; however, a worker may have some sort of permanent impairment that leaves them partially disabled. When that happens, the benefits paid are called permanent partial disability. Each state has workers comp statutes in place that indicate the number of weeks that an employee will receive permanent partial disability. Once that period ends the workers compensation benefits also end.


Medical Benefits

Besides wage replacement benefits based on the level of employee disability, injured workers also receive medical treatment benefits to include all hospital services, surgeries, prescriptions, medical equipment such as wheelchairs or crutches as well as any needed prosthetics. Medical benefits can continue indefinitely as long as they are needed.


Vocational Rehabilitation

Sometimes injured workers are no longer able to return to their usual work. These disabled employees are entitled to vocational rehabilitation or voc rehab services. For a specified period of time according to each state's workers compensation regulations, covered employees can receive counseling, voc rehab evaluation, job development, training and placement.


Death Benefits

In the event of an employee's death caused by a work related event, the workers compensation insurance will pay a death benefit and/or funeral expense to remaining dependent family members.

In order to receive the benefits available through workers compensation insurance policies, employees must report injuries to their employers and file a workers compensation claim. The insurance carrier handles every aspect of managing the claim including medical treatment and benefit payments.


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