Risk Management In Wage Loss States
Posted by Katrina Paglierani on Fri, Oct 02, 2009 @ 06:56 AM
The Workers comp law varies so much from state to state it is a daunting task to keep track. I decided to research the differences in workers comp law as they pertain to indemnity expense. I thought I would share my research on risk management in wage loss states.
I hope this will assist those who are new to the Risk management field with cases in wage loss states.
The following states have high wage loss exposure (indemnity payments) after a case has reached MMI. Michigan (MI), Illinois (IL), Pennsylvania (PA), Louisiana (LA), Maine (ME), New Hampshire(NH) and New York (NY). I will add additional states information as I continue my research.
The following states have no wage loss exposure (indemnity payments) once a case has reached MMI: Alabama, Arizona, Arkansas, Colorado, Connecticut, Florida, Mississippi, Missouri, New Jersey and Tennessee. The State of Florida has "impairment benefits" but no wage loss payments. These payments are determined based on the injury, and continue for a specified amount of time. They are not effected by re-employment of the injured worker in any way. The Injured worker receives the same impairment benefit, whether they are working or not.
Some states have wage loss exposure limited by the rating of the permanent disability or the percentage of disability. Most of these charts are available on each states Workers Comp Board website. A list of these boards by state can be found here:
http://www.ic.nc.gov/ncic/pages/wcadmdir.htm#al
For example: In DC, the length of time an injured worker can receive indemnity payments is based on the injury and a formula determines the benefit. In Michigan, there is no time limit on indemnity payments for permanent partial disability. In New Hampshire the limit is 262 weeks (which includes the weeks the injured worker was considered temporarily disabled.) In Maine and Louisiana the limit is 10 years or 520 weeks. In New York Permanent Partial Disability cases are eligible for indemnity payment to continue depending on injury from a minimum of 225 weeks to a maximum of 525 weeks. Pennsylvania has a limit of 500 weeks for Permanent Partial Disability indemnity payments.
In states where there is a continuance of indemnity, or wage loss, payments required from the Employer or Insurer, there is also the obligation on the part of the injured worker to actively pursue re-employment and/or to make an effort to obtain work. When an injured worker returns to work, depending on the pay variance, the employer may be obligated to continue to make up the difference between the original wage earned when the employee was injured and the new wage. This also varies by state. But, the insurer can apply to the Workers Comp board to discontinue payments if they determine that the Injured worker is not actively pursuing re-employment.