What is Workers' Compensation Coverage A

Workers' compensation coverage A protects employees under state laws and provides medical care, death, disability and rehabilitation benefits for workers who are injured or killed while on the job. The insurer agrees to pay all compensation and benefits related to the insured employer's state's workers' compensation laws. Workers' compensation coverage premiums are based on the employer's payroll and the type of duties its employees perform.

BREAKING DOWN Workers' Compensation Coverage A

Workers' compensation coverage A insurance is a significant expense for employers, and it is legally mandated in nearly every state in the United States. Employers may pay more if the company has had a certain number of previous claims, or if its employees have certain occupations that are deemed dangerous.

Benefits of workers' compensation are generally awarded on a no-fault basis, as long as the employee is not under the influence of drugs, including alcohol. Employees are usually required to submit to a drug test following an on-the-job accident. Many workers' compensation incidents will provide partial reimbursement of lost wages, and survivor benefits in the event the worker is killed while on the job.

Workers' compensation part A satisfies state insurance requirements. It funds employees’ medical bills, related expenses and lost wages in the case of a covered workers’ compensation loss. Payments are made normally based on predetermined schedules in the case of defined injuries. Expenses are paid accordingly as the adjuster calculates them.

Workers' compensation part A has no policy limits, and the insurer instead pays all benefits required by the workers’ compensation law of any state listed in the declarations. However, the employer can be held responsible for payments made by the insurer that exceed regular workers’ compensation benefits. Under such circumstances, an employer would be responsible for such payments because of serious and willful misconduct; knowingly employing workers in violation of the law; failure to comply with health or safety regulation; or discharge, coercion, or discrimination against any employee in violation of the workers’ compensation law. Under this misconduct, the employer is responsible for reimbursing the insurer for any payments that exceed regular workers’ compensation benefits.

Statistics and Clinical Outcomes for Workers' Compensation Part A

Workers' compensation expenses amounted to roughly 1.6% of spending by employers overall, according to the U.S. Bureau of Labor Statistics' 2010 National Compensation Survey. The degree of spending, though, depends on the industry, where one industry may outspend another. For example, the construction industry spent more on workers' compensation than employers in manufacturing and services. The survey showed costs in the construction industry totaled 4.4%, while the other two industries spent 1.8% and 1.3% respectively.

Patients with workers' compensation generally have worse clinical outcomes than those who don't. Those who do and have upper extremity surgeries return to work at lower rates. When they do, they take longer to return. This may be because their jobs are more taxing to their upper bodies and because they may receive more compensation after having a post-operative disability.