Workers Compensation Is Going Down The Drain

The federal government stopped monitoring state workers’ comp laws more than a decade ago. Since then, legislators in 33 states have passed workers’ comp laws that reduce benefits or make it more difficult for those with certain injuries and diseases to qualify for them. Florida is the worst, it has cut benefits to its most severely disabled workers by 65 percent since 1994. 

There can be wide variations in benefits depending on where you get hurt. Because each state has developed its own system, an amputated arm can literally be worth two or three times as much on one side of a state line than the other. The maximum compensation for the loss of an eye is $27,280 in Alabama, but $261,525 in Pennsylvania.

Many states are not only paying less benefits; they're also cancelling benefits after an arbitrary time limit — even if workers haven’t recovered.  Employers and insurers increasingly control medical decisions, such as whether an injured worker needs surgery. The result is that employers are paying the lowest rates for workers’ comp insurance since the 1970s. And in 2013, insurers had their most profitable year in over a decade, bringing in a hefty 18 percent return.

Because benefits are less, many injured workers have been forced to seek help from government programs like Social Security, Medicare and Medicaid which shell out about $30 billion a year.