DI 52120.240 Texas Workers’ Compensation (WC)
A. Texas WC law
1. Major change for injuries 01/1991 or later
The Texas workers' compensation law changed effective 01/1991 for injuries occurring January 1991 and later. There are three provisions of special interest to SSA adjudicators:
A company can self-insure under certain circumstances. This link will take you to the Texas Certified Self-Insurers' Third-Party Administrator/Austin Representative List maintained by the Texas Department of Insurance, Division of Workers' Compensation. The fact of self-insurance does not eliminate the applicability of offset of the Social Security benefit.
NOTE: This differs from the opt-out provision discussed below. Careful evaluation is required to determine which situation exists on a specific case.
No lump sum settlements allowed. (An exception exists if there was a prior injury before 1/1991 and the new injury relates to the old one.)
Time limits on the payment of WC benefits are now provided.
2. WC Law for injuries prior to 01/1991
Texas WC laws prior to the 1991 changes were very similar to many other States.
There were no time limits on payments, and lump-sum settlements were common.
For a copy of the law that applies for injuries prior to 01/01/1991 see: http://www.tdi.state.tx.us/wc/act/documents/oldlawwcact.pdf
B. Types of WC payments
TIB – Temporary Income Benefit (code as TT)
IIB - Impairment Income Benefit (code as PP)
SIB – Supplemental Income Benefit (code as TP)
LIB – Lifetime Income Benefit (code as PT)
The following chart summarizes the four types of benefits that could cause WC offset.
|Type Benefit||Requirements||Amount||Period Payable|
Temporary Income Benefits (TIB);
similar to TT
Has not attained maximum medical improvement (MMI)
70% of average wage before injury less average wage after injury (if working)
If the worker earned less than $8.50/hr, the benefit rate for the first 26 weeks of payment will be 75% of the average wage.
Begins 8th day after disabled due to injury -- ends earliest of maximum recovery achieved or 104 weeks.
Impairment Income Benefits (IIB);
similar to PP
Has attained maximum medical improvement (MMI)
Same as TIB
Begins as early as day after TIB ends. Payable for number of weeks derived by multiplying three (3) times the percent disability established after MMI determined. * Example: percentage of disability: 12% x 3 = 36 weeks of IIB paid.
* The IIB may be commuted or accelerated, but the total amount paid can not exceed the three times the percentage of disability. If IIB is commuted, SIBs are not payable.
Supplemental Income Benefits (SIB);
similar to TP
IIB must have ended and not been commuted.
Impairment rating (percentage of disability) must be 15% or greater.
Wages must be less than 80% of average weekly wage.
Will vary depending on whether the worker has returned to work.
NOTE: worker must file quarterly applications to receive SIB
Begins after IIB, subject to filing of application and wages earned. Ends if wages exceed 80% of average wages for 90 days or longer.
Total period of payment of TIB, IIB and SIB combined can not exceed 401 weeks.
Lifetime Income Benefits (LIB);
similar to PT
Total loss of sight, both eyes; loss of both feet; loss of both hands; loss of one hand and one foot; permanent paralysis of two limbs; head injury resulting in incurable insanity or imbecility.
Up to 75% of average weekly wages.
Increased by a 3% yearly COLA paid on the anniversary date of the day LIB began to accrue. (3% annual increase paid even though it may exceed maximum weekly benefit.)
Begins 8th day of disability and is payable until the death of the worker.
(You will rarely see a case involving payment of LIBs)
There is no provision for payment of a lump sum in lieu of any of these benefits, although commutation or acceleration of the IIB is possible.
C. Cost-of-living adjustments (COLAs)
Lifetime Income Benefits (LIBs) are the only benefits increased by COLAS (per Texas WC law, Section 408.161 (http://www.statutes.legis.state.tx.us/Docs/LA/htm/LA.408.htm#408.161 ). (See chart information in DI 52120.240B in this section.) All other Texas WC benefits are not increased by COLAs. Adjustments to the maximum and minimum benefit amounts occur each fiscal year. The new limits apply to any injury that occurs during that fiscal year.
D. Attorney fees
Attorney fees up to 25 percent allowed.
E. Retirement insurance benefit (RIB) considerations
Texas does not offset its WC for SSA retirement benefits.
F. Advance based on financial hardship
The commissioner may grant a worker suffering financial hardship advances against the amount of income benefits to which the worker is entitled. Before or after the worker attains maximum medical improvement an advance may be ordered. An insurance carrier pays the advance ordered.
A worker must apply to the division for an advance on a form prescribed by the commissioner. The application must describe the hardship that is the grounds for the advance.
An advance under this section may not exceed an amount equal to four times the maximum weekly benefit for temporary income benefits. The commissioner may not grant more than three advances to a particular worker based on the same injury.
G. Opt-out statute
Texas allows employers to elect not to participate in the State's WC system. Injured employees of companies that choose not to participate do not receive WC benefits, but may sue their company for negligence, etc.
Some companies create their own plans providing benefits to employees injured on the job. Payments made under such a law or plan is not subject to offset.
Do not impose offset if payments are paid under the “opt-out” statute.
H. Verification of opt-out statute
If you are working a case that appears to involve an employer that has opted-out of the Texas workers' compensation system, obtain verification from the employer.
Verification could be a copy of the opt-out plan, copy of correspondence with the employees stating they are not covered by State workers' compensation, or a signed statement from the employee.
Also acceptable is an FO precedent on the employer.
State of Texas Insurance Board maintains a list only of those employers who have opted-in and participate in the State’s WC insurance program for the prior two years. Therefore, by default, the employers not listed have opted-out. Online access is provided via TXCOMP's Locate Covered Employers tool.
If you are checking for workers' compensation coverage from a period earlier than the most recent two years, or do not find an employer you believe has coverage, contact the Insurance Coverage Department at (800) 372-7713 or (512) 804-4345.
Employers have the freedom to opt-in and opt-out, and some employers exercise this option more than once. If a worker alleges the employer participated in the WC insurance program at the time of injury, the final developmental contact by the FO must be directly with the employer to determine when or if the employer participated and, if applicable, when the employer opted-out.
I. WC payments to prisoners
TIB payments to prisoners are suspended, which means a break in the WC payment. A break in the payment of TIBs could affect eligibility for future triennial redeterminations. For information on Triennial Redetermination of the ACE, see DI 52150.080D.
J. Contacting the Texas Department of Insurance – Division of Workers’ Compensation
Effective September 1, 2005, the Texas WC Commission was disbanded and its functions transferred to the newly created Division of Workers' Compensation in the Texas Department of Insurance (TDI). Despite this reorganization, the process for obtaining WC information is essentially unchanged. Requests will continue to be made to their Records Center, where employees handle inquiries such as those made by SSA.
If you are unable to obtain needed information directly from the claimant or the WC carrier, the Division of Workers' Compensation can be contacted. The initial request should be made by fax to (512) 804-4378. Do not attempt to initially secure the information by phone. If unable to accomplish a fax transmission, the mailing address is:
Texas Department of Insurance (TDI)
Division of Workers’ Compensation
7551 Metro Center Drive, Suite 100
Austin TX 78744
The consent of the worker is not required before the Division of Workers' Compensation will release information to SSA, but you should still include a copy of any consent statement that has been obtained. In order for the Division of Workers' Compensation to verify that the request is from SSA, they ask that it be made using a document with an SSA letterhead. Any fax cover sheet with the SSA logo may be used, and individual PCs and FOs should create their own local forms for this purpose. An SSA-1709 should be included as an attachment if deemed appropriate. At a minimum, include the NH’s name, SSN, and the date of the workers’ compensation injury. The DWC uses the injury date to search for the record, applying a tolerance of 60-90 days from the injury date shown. If the injury date is unknown, but indications are that the WC payments started at a time close to the onset date established by SSA, show: “Not in SSA records but the Social Security onset date is MM/DD/YYYY.” If there is an indication that the WC payments did not begin until sometime after DIB was awarded, as would be the case if a DIB beneficiary later returned to work and was injured on the later job, show an injury date slightly prior whatever WC start date is alleged or otherwise indicated on whatever documentation is in file. To facilitate a response, show your name, title, phone, and fax number on the correspondence.
The Division of WC requests that we wait 60 days before doing a follow-up on the status of a request. If no reply has been received by then, the CA/CTE should do a follow-up phone call to 800–252–7031. Besides providing assistance in determining the status of the prior request, they can also, if needed, help interpret the documents you received.