Workers' Compensation Insurance and Workers' Rights

Workers' compensation removes some of the worry about injuries at work.

Workers' compensation in the United States was conceived during a 1910 Chicago meeting among leading state representatives seeking uniform compensation rules. In 1911, Wisconsin became the first state to create workers' compensation statutes. By 1920, 46 U.S. states had laws providing benefits and medical care to workers injured on the job. Employees no longer had to prove employer negligence to receive needed assistance. All 50 states have similar workers' compensation laws, but some rights vary among states.

Right to Coverage

Many states require employers to provide coverage, although some states exempt certain categories of employees. New York does not mandate coverage for some farm-labor employees, and Utah does not require coverage of agricultural employees if the employer's payroll falls below certain thresholds. California requires all employers with even one part-time or temporary employee to carry coverage. Texas does not require employers to carry coverage. Some categories of employees receive workers' compensation from the federal government such as longshoremen, harbor workers, certain maritime workers, federal employees and coal-mine workers who contract black-lung disease. Employees need to consult their state's insurance department regarding coverage details.

Prompt Processing Requirements

States have varying deadlines for insurance companies to issue decisions on workers' compensation cases. In Ohio, the state-administered insurance program decides cases in 28 days. In California, insurers must make a decision within 90 days. Utah insurance carriers must request additional processing time after 21 days and may receive a total of 45 days to make a favorable or unfavorable decision. Employees receive medical care while claims are pending, and payments usually start after employees have been unable to work at least seven days, although Utah pays benefits to workers who have lost three days of work. Payments are usually paid bi-weekly. The first check usually comes within varying time frames after the insurer receives the notice of injury from the employer. For example, Louisiana sends the first check 14 days after receipt of the notification from the employer.

Right to Cash Benefits

Most states have temporary and permanent payments. In California, temporary payments last up to 104 weeks. In Utah, payments can last up to 312 weeks. New York and Utah provide workers' compensation payments for life if the disability is total and permanent. California employees and employers agree on a settlement for partial or total permanent disabilities that the employee receives in a lump sum or in bi-weekly installments. Partial disability awards are based on the percentage of permanent disability. For example, in New York, a worker with a loss of less than 100 percent but over 95 percent receives benefits for 525 weeks; for a partial disability rated at 61 through 70 percent, the worker receives benefits for 375 weeks. California and New York are examples of two states with special lump sum amounts for specific injuries such as loss of an eye, a digit or a limb.

Appeal Rights

Appeal rights come with all workers' compensation plans, but the filing deadlines and appeals process vary from state to state. In Ohio, workers can file appeals within 14 days with the industrial commission; a district hearing officer must then schedule the hearing within 45 days. The state of Utah provides a mediation service that resolves 85 percent of disputes between insurers, employers and employees. California workers can appeal decisions to a workers' compensation administrative law judge within varying time frames that unfavorable notices will provide.

References

• The Iowa Orthopaedic Journal: The Iowa Orthopaedic Journal -- A Brief History of Workers' Compensation
• Utah Labor Commission: Employee's Guide to Workers' Compensation
• California Department of Industrial Relations: Workers' Compensation in California
• U.S. Department of Labor: Summary of the Major Laws of DOL
• New York State Workers' Compensation Board: Employers' Handbook to Workers' Compensation in New York State
• Louisiana Workforce Commission: Key Steps in Workers' Compensation for Injured Workers

Resources

• Texas Department of Insurance: Workers' Compensation Resources for Employers
• The Center for Insurance Policy and Research
• National Association of Insurance Commissioners: About the CIPR
• U.S. Department of Labor: State Workers' Compensation Officials
• Ohio Bureau of Workers' Compensation: Injured Worker FAQs