CHAPTER

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12Workers’

Compensation and Disability/Automotive

Insurance

Learning Outcomes

When you finish this chapter, you will be able to:12.1 Explain the four federal workers’ compensation

plans.

12.2 Describe the two types of state workers’ compensation benefits.

12.3 Classify work-related injuries.

12.4 List three responsibilities of the physician of record in a workers’ compensation case.

12.5 Differentiate between Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).

12-2

Key Terms

• Admission of Liability• automobile insurance

policy• disability compensation

programs• Federal Employees’

Compensation Act (FECA)

• Federal Insurance Contribution Act (FICA)

• final report• first report of injury

12-3

• independent medical examination (IME)

• liens

• Notice of Contest

• occupational diseases or illnesses

• Occupational Safety and Health Administration (OSHA)

• Office of Workers’ Compensation Programs (OWCP)

Key Terms (continued)

• personal injury protection (PIP)

• physician of record

• progress report• Social Security Disability

Insurance (SSDI)• subrogation• Supplemental Security

Income (SSI)• vocational rehabilitation

12-4

Chapter 12 Introduction 12-5

• Occupational Safety and Health Administration (OSHA)—created by Congress in 1970 to protect workers from health and safety risks on the job– Sets standards to guard against known dangers in the

workplace– Businesses must meet these standards or be subject

to significant fines

12.1 Federal Workers’ CompensationPlans

12-6

• Office of Workers’ Compensation Programs (OWCP)—administers programs to cover work-related illnesses or injuries suffered by civilian employees of federal agencies

• Federal Employee Compensation Act (FECA)—provides workers’ compensation insurance for civilian employees of the federal government

12.1 Federal Workers’ CompensationPlans (continued)

12-7

• The four workers’ compensation plans that provide coverage to federal government employees are:1. The Federal Employees’ Compensation Program

2. The Longshore and Harbor Workers’ Compensation Program

3. The Federal Black Lung Program

4. The Energy Employees Occupational Illness Compensation Program

12.2 State Workers’ Compensation Plans 12-8

• States provide two types of workers’ compensation benefits:1. One pays the worker’s medical expenses that result

from work-related illness or injury

2. The other pays for lost wages while the worker is unable to return to work

• Occupational diseases or illnesses—caused by the work environment over a period longer than one workday or shift

12.3 Workers’ CompensationTerminology

12-9

• Work-related injuries are grouped into five categories:1. Injury without disability

2. Injury with temporary disability

3. Injury with permanent disability

4. Injury requiring vocational rehabilitation

5. Injury resulting in death

12.3 Workers’ CompensationTerminology (continued)

12-10

• Final report—filed by the physician in a state workers’ compensation case when the patient is discharged

• Independent medical examination (IME)—examination conducted by a physician to confirm that an individual is permanently disabled

• Vocational rehabilitation—program to prepare a patient to return to the workforce

12.4 Claim Process 12-11

• Physician of record—provider who first treats a patient and assesses the level of disability– The physician of record in workers’ compensation

cases is responsible for:

1.Treating the injured worker

2.Determining the percentage of disability

3.Determining the return-to-work date and filing progress notes

• Progress report—filed by the physician in state workers’ compensation cases when a patient’s medical condition or disability changes

12.4 Claim Process (continued) 12-12

• First report of injury—filed in state workers’ compensation cases, containing employer and accident information and patient’s description of the accident

• Admission of Liability—determination that an employer is responsible for an employee’s claim under workers’ compensation

• Notice of Contest—determination to deny liability for an employee’s workers’ compensation claim

12.5 Disability Compensation and Automotive Insurance Programs

12-13

• Disability compensation programs—provide partial reimbursement for lost income when a disability prevents an individual from working

– Benefits are paid in the form of regular cash payments– The federal government provides disability benefits to

individuals through several different programs

• Automobile insurance policy – contract between an insurance company and an individual for which the individual pays a premium in exchange for coverage of specified car-related financial losses

12.5 Disability Compensation and Automotive Insurance Programs

12-14

• Social Security Disability Insurance (SSDI)—federal disability compensation program for some qualified people– Provides compensation for lost wages to individuals

who have contributed to Social Security through FICA payroll taxes

• Federal Insurance Contribution Act (FICA)– authorizes payroll deductions for the SSDI

• Supplemental Security Income (SSI)—welfare program that helps pay living expenses for low-income older people and those who are blind or have disabilities

12.5 Disability Compensation and Automotive Insurance Programs

12-15

• Subrogation – action by payer to recoup expenses for a claim paid when another party should have been responsible for paying at least a portion of the claim

• Personal injury protection – insurance coverage for medical expenses and other expenses related to a motor vehicle accident

• Liens – written, legal claims on property to secure debt payment

Summary

Summary