Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers...

Social Insurance

Chapter 11

Programs

• Social Security

• Medicare

• Unemployment Insurance

• Workers Compensation

Workers Compensation- History

• Employer liability laws– Need to prove employer’s negligence– Common law defenses

• Contributory negligence

• Fellow servant rule

• Assumption of risk

Workers Comp - Principles

• Absolute liability

• Partial but final indemnity

• Periodic payments

• Part of the cost of operations

• Mandatory insurance

Benefits

• Medical expenses

• Disability– Total/Partial– Temporary/permanent

• Survivor’s death benefits

• Rehabilitation

Features

• Employee cannot sue

• Benefits, coverage vary from state to state

• Benefits are mandated

• Some states have second injury funds

• Some states cover disability not related to the job (Compulsory Temporary Disability Laws)

Social Security/Medicare

• Old-Age, Survivors’, Disability, and Health Insurance

• Pay roll tax (15.3%)• Pay as you go system• Social security trust funds

– Old age and survivors– Disability– Hospital insurance– Supplementary insurance

Loss of benefits

• Dependency status

• Other income– Exempt income (pension, investment income)

• Taxation of benefits– Does not go into general revenue

Challenges

• Can the system go broke?

• Ratio of workers to retirees

• Political decision making

Unemployment insurance

• State plans

• Rationale for insurance

• Market failure argument

• “Employer paid” taxes

• Experience rating