Workers Compensation 100 Workers Compensation Basics l Introduction

Workers Compensation 100 Workers Compensation Basics l Introduction and History

Workers Compensation 100 History and Concept l Before workers compensation laws were enacted in the early 1900 s, if an employee was injured or killed on the job, the employee or the surviving family received neither medical care nor compensation for lost wages unless they could prove in court that the employer was negligent. Not only did they have to prove the employer was negligent, they had to show that the employee’s actions in no way contributed to the cause of the accident. Consequently, many deserving employees suffered severe loss in the service of their employers, and the few who did prevail in court were forced to wait until the conclusion of the trial process before receiving any compensation.

Workers Compensation 100 What is Workers Compensation? l A no-fault system l Pays entitlements for accidental injuries or occupational diseases that “arise out of and in the course of employment” l Laws are different by state.

Workers Compensation 100 Entitlements l Medical l Lost Treatment Wage Replacement l Permanent l Death Disability Award Benefits

Workers Compensation 100 The Players l Administrative Law Judge l Employer l Insurance Company l Third Party Administrator (TPA) [self-insureds] l Attorneys

Workers Compensation 100 In the early 1900 s l Employees did not have workers compensation coverage. l Employees had to prove the employer’s negligence. Punitive damages could be awarded [in large sums] Deserving employee often received no monetary compensation for their permanent disabilities

Workers Compensation 100 Today l Is a no-fault system l Guarantees prompt medical treatment at no cost to employee l Guarantees prompt payment of benefits l Limits employer’s liability to a set level.

Workers Compensation 100 Today l Today, virtually all employees are covered by either state or federal workers compensation acts. This includes full-time, and in many cases even volunteers employees. Many times an employer may even find it has employees it did not think it had. However, it is important to note that while statutes govern the amount of benefits to be paid, they are not state paid benefits. The employer actually pays the benefits to the employee.

Workers Compensation 100 What is covered l Bodily injury and occupational disease* “arising out of and in the course of employment”** are covered under workers compensation laws. The language arising out of and in the course of appears in most statutes. That language creates a twopronged test to determine if a worker’s ailment is subject to coverage under workers compensation. When an injury or disease is found to “arise out of and in the course of employment, ” it is said to be compensable. Once an injury is found to be compensable, benefits will be paid to the employee. * All bodily injury and occupational disease. l ** Must be caused by the employment and happen in the course of employment. l

Workers Compensation 100 What are the benefits? l Medical Treatment l Wage Replacement l Permanent Disability Payments

Workers Compensation 100 Medical Treatment l The medical expenses necessary to cure and relieve the employee’s injury are paid by the employer from the first dollar. No deductibles or co-payments apply. The employee pays no outof-pocket expenses at all. These medical expenses are not part of any benefits paid by the employee’s health coverage. In fact, if the employee inadvertently submits medical bills to the health coverage, the health plan typically will refuse to pay such medical expenses incurred as the result of an on-the-job injury.

Workers Compensation 100 Wage Replacement l If an employee’s injury is severe enough to prevent the employee from temporarily returning to work, the employee will receive weekly payments during the duration of the recovery process. The payments will be roughly equivalent to two -thirds of the employee's average weekly wage. The weekly payment is not taxable.

Workers Compensation 100 l Weekly temporary total disability payments (TTD) l Temporary partial disability payments (TPD) l Weekly survivor benefits l Vocational

Workers Compensation 100 Every state has a waiting period before wage benefits are owed. This varies from three to seven days on a state-by-state basis. (Missouri is three days) l In the event of a work-related death, weekly survivor benefits are paid to the employee’s dependents. A burial allowance is also paid. l

Workers Compensation 100 Permanent Disability Payments l If the employee will always suffer from a permanent impairment as a result of the workrelated injury, the employee will receive some additional payment for the loss of function or earning capacity. These payments vary significantly from state to state. [Statutory permanent disability settlements]

Workers Compensation 100 Terminology l Adjuster: Person who investigates and determines the extent of liability for loss when a claim is submitted. l Claim: Used in reference to insurance; a claim may be a demand by an individual or corporation to recover, under a policy of insurance for loss which may come within that policy. l IME: Independent Medial Exam – hire services of independent physician, examine and treat if necessary.

Workers Compensation 100 Terminology [Continued] l LEC: Loss of Earning Capacity – loss due to employee’s inability to return to wage earned prior to accident. l Light Duty: When an injured worker is authorized to return to a transitional limited duty job by the treating physician but is unable to return to regular duty. l LSS: Lump Sum Settlement – single-sum final payment as settlement for a permanent disability.

Workers Compensation 100 Terminology [Continued] l MMI: Maximum Medical Improvement – as determined by the authorized treating physician, meaning the injured worker will not physically improve beyond this point. l PPD: Permanent Partial Disability – permanent disability given by authorized physician for a body as a whole or body part. l Reserves: Reserves are a realistic forecast of loss payments to be made in the future, or legal liability incurred in the present.

Workers Compensation 100 Terminology [Continued] l RTW: Return to Work – when an injured worker had been released by the physician to return to work activities. l Subrogation: The assignment to an insurer by terms of the policy or by law, after payment of a loss, of the rights of the insured to recover the amount of the loss from one legally liable for it.

Workers Compensation 100 Terminology [Continued] l TPD: Temporary Partial Disability – when an injured worker can return to work with restricted working hours. l TTD: Temporary Total Disability – lost time from work when and injured worker can not return to work. l Voc. Rehab. : Vocational rehabilitation that requires retraining an injured worker for another job due to permanent injury. [Not common to all states. ]

Workers Compensation 100 Terms and Abbreviations l l l l AWW: CLMT: C/T: Dl, DOL, DOI: DX: FX: INSD: MO: Average Weekly Wage Claimant – Employee Cumulative Trauma Date of Loss/Injury Diagnosis Fracture Insured Medical Only

Workers Compensation 100 Terms and Abbreviations [Continued] l l l NLT: PD/PPD: TD/TTSD: TPA: TX: No Lost time Permanent Partial Disability Temporary Total Disability Third Party Administrator Treatment

Workers Compensation 100 Uncommon Abbreviations [Continued l l l l l JA: LDW: LEC: LSS: PDR: RRTW: S/P: DOB: DON: Job Analysis Last Day Worked Loss of Earning Capacity Lump Sum Settlement [single-payment settlement] Permanent Disability Rating Release to Return to Work Self-Procured Medical Treatment Date of Birth Date of Notice (of claim)

Workers Compensation 100 Uncommon Abbreviations [Continued l l l l Subro: SX: VRS: W/L: Π: Δ: Subrogation Surgery Vocational Rehabilitation Services Wage Loss Applicant/Employee/Plaintiff Defendant/Employer

Workers Compensation 100 Top 5 Reason People Hire an Attorney l 5. “Not receiving my pay or not paid on time. ” l 4. “I don’t like my doctor. ” l 3. “I was afraid I was going to lose my job. ” l 2. “The process is just taking too long” l 1. “No one called me up to see how I was doing. ”

Workers Compensation 100 Controlling Costs l 1. Management Commitment l 2. Temporary Transitional Duty l 3. Designated Medical Providers l 4. Injury Management Procedures

Workers Compensation 100 Management Commitment l Support the process l Provide the necessary resource. l Recognize that employees are our biggest resource, our strongest customer service tool and our key to future growth

Workers Compensation 100 Injury Counselor l Key Fact: The injured employee has an overwhelming capacity to determine the course of his/her claim. An injury counselor can assist the employee and facilitate the process getting the employee healed and back on the job with a full wage.

Workers Compensation 100 l Take a look at what is happening in your area. l Improvement is always possible. l On-the-job injuries don’t have to happen. l Make the commitment. l Make a change.

Workers Compensation 100 l. The End

Workers Compensation 100 l. Q &A