As a business owner, you understand the importance of workers’ compensation insurance. It protects you from medical expenses and employee lawsuits related to workplace injuries.
However, there are many things you need to know about this coverage. Understanding the basics of workers’ comp will help you avoid costly mistakes and keep your employees and business safe.
Understanding the Basics of Workers’ Compensation Insurance
In almost every state, businesses that employ at least one employee must purchase workers’ compensation coverage. Most states also require employers to notify their employees of the range and give them a claim form to fill out if they have an injury or illness.
The policy is usually a two-part insurance contract, referred to as “Part One” and “Part Two.” Part One pays whatever the state-required benefits are for an employee with a work-related bodily injury or disease.
This includes payments for medical care, wage replacement, and death benefits. The amount an employee can receive is based on how much they have lost in wages during the time they are injured.
Many states have standardized data coding systems that use industry risk classifications, injuries and events descriptions, and other factors to determine whether a claim is compensable. This helps ensure the insurance company knows what is covered and how to calculate the cost of a claim.
Workers’ compensation insurance helps businesses protect themselves and their employees. Typically, it covers medical expenses and missed wages for an employee who is injured while working.
It also covers vocational rehabilitation services if an injured employee needs ongoing care. And it provides death benefits if an employee dies in a workplace accident.
In most states, employees must have workers’ comp coverage for any job. But the rules vary from state to state.
Exceptions include contractors and freelancers, rarely covered by workers’ comp. In addition, some states exclude certain professions from coverage or limit the scope of benefits.
A workers’ comp policy consists of “Part One” and “Part Two.” Part One covers the statutory requirements that the employer must pay for an employee’s work-related injury or illness, such as salary replacement payments.
A worker injured or becomes ill due to their job may file a claim with their employer’s insurance carrier. They must provide the insurer with information such as the nature of the injury/ illness, how it occurred, the type and cost of medical care received, the cost of partial wage replacement, the number of days off work, and injured worker characteristics (occupation, age, gender, time with the employer).
Insurers also collect data on the types of hazards present in the workplace, safety/ health programs and controls in place to prevent injury/ illness, and return-to-work programs to reduce injury/ illness severity. These data help employers and insurers set rates for workers’ compensation coverage.
Workers’ compensation claims can be denied for many reasons. Employees typically have the right to appeal this decision. They can seek legal representation if they feel the insurance company must act within the law or misrepresent the facts. Depending on state laws, the insurance company must report its decision to the workers’ compensation board. These decisions can be challenging to navigate without the proper knowledge and guidance.
Statutes of Limitations
Most people understand that there are statutes of limitations for criminal acts and personal injuries, but they may not be aware that workers’ compensation claims also have them. This is because statute limitations protect people from getting their legal claims stuck in the system.
Most states require an injured worker to file a claim within a specific time. This is called the “statute of limitations” and can vary depending on your injury or illness.
For example, in Arizona, a worker must file a workers’ compensation claim one year from the date of their injury or discovery of it. This is not the last year you have to file your claim, but the deadline must be met to ensure that your rights are protected and prevent you from losing the right to seek benefits.
However, employers often use this rule to try and stop workers from getting the compensation they deserve for their injuries. For this reason, it is crucial to work with a Cherry Hill workers’ comp lawyer who can advocate for you to ensure that your case is filed on time and that you can receive the benefits you need.
Medical treatment is essential for getting well after a work-related injury or illness. However, medical treatment can be costly.
Workers’ compensation insurance provides cash benefits and medical care for injured or sick people on the job. These systems are largely financed by employers who buy coverage through private insurers or state-certified compensation insurance funds.
The main goal of medical treatment for a work-related injury or illness is to allow the employee to heal and return to work. The definition of reasonable and necessary treatment is a contentious issue between workers’ comp insurance companies and physicians who treat injured workers.
Usually, services like doctor appointments, medications, and diagnostic tests are considered reasonable. In some cases, surgeries and other more extensive treatments will be covered if the injuries are severe enough to warrant them.
Most doctors will recommend appropriate treatment related to work-related injury or illness. This includes medications, surgery, and physical therapy