What Benefits Does Workers' Comp Provide?

Unlike health insurance, an employee benefit offered by the employer to the employee, workers' compensation insurance is a business expense. Employers must provide workers' comp benefits for their workers even if they have other health insurance plans.

Workers' comp coverage includes all medical benefits that health insurance might cover at no cost to the worker.

All states except Texas require workers' compensation. A workers' comp policy aims to provide workers with immediate access to health care, even if it is due to the worker's negligence. Small-business owners are not exempt from workers' comp requirements. Depending on state laws, even those with one employee must provide workers' compensation coverage.

See FindLaw's Workers' Compensation Basics sections for more articles and resources.

Medical Care

Workers' comp insurance covers all work-related injuries and illnesses. Injured workers must receive all necessary medical treatment ordered by their doctor. Depending on state laws, the employer may require employees to see a company doctor or a physician designated by the insurance company. Medical care includes:

• Immediate medical expenses, including ambulance transport, emergency room care, and self-transport to the hospital.
• Follow-up treatment, including return visits to a doctor or treatment by specialists.
• Ongoing care for chronic injuries. For instance, if a worker needs physical therapy, workers' compensation can cover the necessary treatment to keep the worker on the job.
• Prescriptions, medical bills, and out-of-pocket costs the employee may have incurred during treatment.

Disability Benefits

Workers' compensation disability benefits are unrelated to federal disability payments. The federal government makes Social Security Disability Insurance (SSDI) payments. Individuals must apply for these payments and prove they cannot work at any gainful employment.

Workers' compensation disability payments bridge the gap between the time of injury and return to work. State workers' compensation laws set minimum and maximum pay rates for disability payments. There are two types of disability payments.

Temporary Disability

Temporary disability benefits are available for injured employees who need time off to recover after their injury. Laws limit temporary benefits to a certain number of weeks or months.

• Temporary total disability is paid when an injured worker cannot return to work. For instance, when an on-the-job injury requires two weeks in the hospital for recovery, the worker would receive temporary total disability payments.
• Temporary partial disability payments are granted if a worker can return to work on a limited basis. A warehouse worker who needs a short-term position at a desk job could receive partial disability to make up their wages until they return to their regular position.

Permanent Disability

A permanent disability is an injury that has reached its "maximum medical improvement" (MMI) and is not expected to improve within the next year. If the disability prevents the individual from working at the same job they did before the injury, it is a permanent total disability. If the worker can work at the same job with some accommodations, it is a permanent partial disability.

These definitions are not the same as the definitions used in the Americans with Disabilities Act (ADA) or the Social Security Administration (SSA). Permanent disability for workers' compensation insurance coverage only affects whether the employee continues to receive partial wages due to a work-related injury.

Vocational Rehabilitation

Some states include job assistance and vocational rehabilitation with workers' compensation benefits. Vocational rehab may be part of on-the-job retraining due to partial disability. It may be job counseling and placement for employees who cannot return to work with their former employer.

Depending on your state's department of labor requirements, vocational rehab could include:

• Job skills testing
• Resume services
• Education and retraining assistance
• Job referrals

Return to Work

Several federal laws affect an employee's return to work following a workplace injury. If workers are temporarily or permanently disabled, they may fall under the Americans with Disabilities Act (ADA) and need accommodations to return to work. Employees may use the Family and Medical Leave Act (FMLA) if they need more time to recover from their injury or illness.

These laws require the employer to work with the employee and doctors to develop a plan that will assist the employee in the return to work in the way that best accommodates the injury or illness. Return to work practices can include any or all the benefits discussed above, depending on the needs of the worker.

If the employee continues receiving workers' compensation payments or returns to full-time work, it may reduce their SSDI or state disability payments.

Death Benefits

If the worker dies in a workplace accident, family members and dependents receive workers' compensation death benefits. These benefits may include funeral costs and payments to dependent minors. Disabled minor dependents will receive death benefits for life.

Death benefits are awarded regardless of any other retirement plans or pensions the employee may have had.

Get Legal Advice for Workers' Compensation Questions

State law requires workers' compensation policies. Consider getting legal advice if you have questions about managing workers' compensation claims. Speak with an employment law attorney in your area for information on your state laws.