It’s natural to worry about lost wages and medical bills if you’re hurt on the job. Here’s a guide to what workers’ compensation coverage will do for you.
Most employers in the United States are required to carry some version of a workers’ compensation insurance plan (“workers’ comp”) to cover workers who’ve suffered a job-related illness or injury.¹
Workers’ compensation insurance pays all approved medical expenses directly related to the worker’s injury, usually including vocational therapy, as needed.
Equally important, workers’ comp insurance pays a portion of the injured worker’s wages until the person can return to work.
If a worker suffers a fatal work-related injury or illness, death benefits will be paid to the family.
Workers’ Compensation Pros and Cons
Workers’ compensation is not the same as unemployment insurance. Workers’ comp only covers employees who get hurt or sick because of their job.
Workers’ comp insurance is a type of no-fault insurance for on-the-job injuries that makes it easier for injured workers to get immediate medical care and income during recovery without having to prove their employer was negligent.
But there are trade-offs involved, sometimes called a “compensation bargain.” That means workers face some limitations under the workers’ compensation insurance system, such as:
- Financial compensation is limited to partial wages and approved medical costs.
- The worker may be limited in choice of medical providers.
- There is no compensation for the worker’s pain and suffering.
- In most cases, the injured worker cannot sue the employer.
Eligibility for Workers’ Compensation Coverage
Workers’ compensation rules are different from state to state. The rules for your state will specify when workers are eligible for compensation, the types of injuries or illnesses that may be covered, and the amount and duration of wage benefits.
Your workers’ comp rules will depend on the state where you work. Find yours with this U.S. Department of Labor map of State Worker’s Compensation Offices.
Almost every state has a deadline for reporting a work-related injury and filing a workers’ comp claim. If you miss the deadline, your claim will automatically be denied.
No matter where you live and work, be sure to notify your employer as soon as possible after you’ve been injured, or as soon as you find out you have a job-related health problem.
Not all employers are required to carry workers’ comp insurance. Depending on the state, some smaller companies with only a few employees are excused from having to provide any workers’ compensation coverage.
On the other hand, some companies have enough assets to provide intra-company insurance with benefits equal to, or better than those provided under the state’s workers’ compensation laws. These companies are referred to as “self-insured.”
Who Is Not Eligible for Workers’ Comp?
Federal workers will not be eligible for traditional state-mandated workers’ compensation. However, federal and postal service employees are covered for work-related injuries and illness through the Division of Federal Employees’ Compensation.
Most states exempt certain types of workers from eligibiliy for workers’ compensation. The most common categories of workers who are not covered by workers comp are:
- Freelance or contract workers
- Seasonal workers
- Domestic workers in private homes
- Farm workers
- Temporary or agency workers
- Undocumented workers
Exceptions to the Exceptions
Be sure to check your state’s guidelines for eligibility. Every state is different.
Most volunteers won’t be able to get workers’ comp benefits, but many states do provide coverage to volunteer firefighters.
Are you really a freelance worker? It depends. If your employer dictates the hours and place of your work, you may qualify as an “employee” for workers’ comp eligibility.
Some states, like California and Texas, require employers to provide workers’ compensation benefits to seasonal or migrant workers, including undocumented workers.
Not sure if you qualify? Get the medical care and lost wages you deserve. Contact a personal injury attorney for help with your workers’ compensation claim.
Medical and Rehab Benefits for Workers
When you’ve been hurt on the job, workers’ compensation benefits should cover the cost of your medical and therapy expenses.
Using Approved Medical Providers
The workers’ comp plan where you work might require you to be treated by medical providers approved by the plan. Be sure to ask if you can choose your own doctor.
Injured workers must have an initial medical evaluation by an approved provider before the plan’s deadline. Depending on your state rules, the deadline can range from 30 to 90 days after the injury date.
If you don’t get a qualified medical evaluation before the deadline, you may lose your right to continue your claim.
After you’ve been evaluated by an employer-approved doctor, you may choose to get an independent medical opinion from your own doctor.
You might have to pay the costs out of your own pocket, although in some states you can ask to be reimbursed for the second opinion before your claim is closed.
Get copies of your medical records, including bills, test results, and doctor’s notes, and submit a copy to the workers’ comp insurance company.
Rehabilitation Options to Get You Back to Work
Most workers’ compensation laws provide injured employees the right to physical and vocational rehabilitation.
Physical rehabilitation covers medical and therapeutic care.
This includes physical therapy to assist in coping with the effects of your injury and to help you return to your job duties.
Physical therapy benefits cover the cost of licensed physical therapists, massage therapists, and others certified to assist with the healing process.
Vocational rehabilitation helps get you ready to take on a new job with your current employer or find a new job elsewhere. Vocational rehabilitation coverage varies from state to state and may include:
- Retraining for a different type of job within the company
- Education and tuition payments for retraining
- Résumé and employment application assistance
- Assistance in searching for a new job with another company
- Specialized testing to determine if you have skills for a new career
- Counseling about your employment expectations and qualifications
Calculating Your Weekly Wage Benefits
Most workers’ compensation plans pay an injured worker approximately 66 percent (two-thirds) of their normal weekly wages, but there are limits. Typically, your wage benefit is calculated using the amounts you earned for the previous 52 weeks. Each state has a different formula for calculating the weekly wage benefit.
Your earnings for the prior 52 weeks should be based on your gross income (before taxes and deductions), not your take-home pay. Also be sure to include overtime, bonuses, tips, and other financial compensation from your employer, such as a weekly gas allowance.
Make sure you verify the calculations made by the workers’ comp insurance company. Incorrect wage calculations are the most common mistake made in workers’ comp cases, and the mistakes are almost never in favor of the injured worker.
Find out your maximum weekly wage benefit with this SSA Chart of States’ Maximum Workers’ Compensation Benefits.
Benefit amounts can differ dramatically from one state to the next. Be sure your wage benefits are calculated correctly, based on the state where your employer is located.
For example, a construction worker who lives in West Virginia may work for an Ohio-based builder. The maximum weekly wage benefit for Ohio workers’ comp is over $100 more per week than in West Virginia.
Fortunately, the weekly wage benefit for most workers is not subject to federal taxes.
Workers’ Comp Disability Ratings
How long you can expect to receive weekly wages from workers’ comp depends on your injury and your category of disability.
Disability categories can be total or partial, and temporary or permanent.
Definition of Worker Disability Categories
Temporary Total Disability completely prevents you from working for a limited amount of time.
Temporary Partial Disability prevents you from doing some, but not all, of your job duties for a limited amount of time.
Permanent Total Disability prevents you from ever returning to work, whether for your current employer or another employer.
Permanent Partial Disability is a permanent injury that partially impairs your ability to work.
Injured workers have the right to dispute or appeal workers’ comp benefit decisions about their level of disability, medical care, or weekly wage calculations.
Workers’ Compensation and Social Security Disability
Injured workers can receive workers’ compensation and federal Social Security Disability Income (SSDI) at the same time, but there will be some offsets made to the total amount you’ll be eligible to receive.
For more information, read the Social Security Administration’s publication How Workers’ Compensation and Other Disability Payments May Affect Your Benefits.
Workers’ Compensation Death Benefits
Most workers’ comp state laws include death benefits when an employee dies from an on-the-job injury. The total amount varies from state to state and often includes funeral costs.
Workers’ compensation death benefits are paid to surviving family members, usually those who depended on the worker’s income.
In some states, if the worker had no family, the death benefits are paid to the worker’s estate.
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