Biery: Workers' Compensation Rates Jump Again

Thursday, February 1, 2018 | 0

There continues to be an upward spiral of workers' compensation rates in Illinois. Please don’t shoot the messenger for telling you how to get them right.

Shawn R. Biery

As mentioned before, twice every year starting in the 1980s, the state Workers' Compensation Act provides a formula that effectively ensures that no matter how poorly the state economy is doing, our WC rates keep climbing. We caution our readers to pay attention to the fact the statutory maximum permanent partial disabilty rate is now $794.56 (up from $775.18).

When it was published, this PPD max rate changed retroactively from July 1, 2017, to present. If you reserved a claim based on the prior rate for the period from July 1 to now, your reserves are wrong.

If you have a claim with a date of loss after July 2017 and a max PPD rate, you need to take a look and see if the new maximum PPD rate applies.

The current temporary total disability weekly maximum has risen to $1,463.80. An Illinois worker has to make more than $2,195.70 per week, or $114,176.40 per year, to hit the new maximum TTD rate.

We still don’t believe any state in the country has a TTD maximum that high. If you know of one, let us know. The new Illinois minimum death rate also went up.

The state's minimum death benefit is 25 years of compensation, or $548.93 per week. Mulitiplied by 52 weeks in a year for 25 years, that equals a staggering $713,609! Yes, if claimant makes $100 a week in a part-time job and dies in a work-related accident, the benefit is more than $700,000.

The new maximum death benefit is $1,463.80. Multiplied by 52 weeks a year for 25 years, that's a lofty $1,902,940 plus burial benefits of $8,000. On top of this massive benefit, Illinois employers/governments have to pay cost of living increases under the Rate Adjustment Fund that may double that already-high benefit, depending on the Consumer Price Index.

Shawn R. Biery is a partner of Keefe, Campbell, Biery and Associates, a Chicago-based workers' compensation defense firm. This column was reprinted with his permission from the firm's client newsletter.