Workers comp benefits explained

Why employers should know the benefits

Your insurer pays the benefits, but you still play a big role. You report the injury, you give the insurer wage records, and you decide whether you can offer light work. Each of these affects how much a claim costs, which affects your experience mod and future premiums.

Medical benefits

Workers' comp pays for medical care needed to treat a work injury or illness. That can include doctor visits, hospital care, surgery, prescriptions, physical therapy, and medical equipment. In most states the worker does not pay a deductible or copay. States set fee schedules and treatment guidelines, and many have rules about which doctors the worker can see.

Wage replacement benefits

Most states replace about two-thirds of the worker's average weekly wage, up to a weekly maximum that the state sets each year. The main types are:

• Temporary total disability: paid while the worker cannot work at all during recovery.
• Temporary partial disability: paid when the worker can do some work but earns less than before.
• Permanent partial disability: paid when the injury leaves a lasting impairment, such as lost motion in a hand.
• Permanent total disability: paid when the worker can never return to suitable work.

Waiting periods

Most states have a short waiting period, often three to seven days, before wage benefits start. If the worker stays off work long enough, many states then pay for the waiting days too. In California, for example, temporary disability pays two-thirds of lost gross wages, up to a weekly maximum, once the doctor says the worker cannot do their usual job for more than three days or the worker is hospitalized overnight.

Death and other benefits

If a worker dies from a work injury or illness, the policy pays death benefits to dependents and helps with funeral costs. Some states also offer job retraining or vouchers for school when a worker cannot go back to their old job. Settlements are possible in many states, but they must follow state rules and often need a judge's approval.

How employers can help

Send accurate wage records quickly, because wage benefits depend on them. Keep in touch with the worker. Offer light work that fits the doctor's limits when you can. Workers who return sooner usually recover better, and the claim usually costs less.