Last State With Permanent Disability Fund Votes to Shut Down Program

Monday, May 23, 2016 | 0

The Arkansas House of Representatives voted 95-1 on Friday to eliminate the Workers' Compensation Commission's Death and Permanent Total Disability Trust Fund.

Rep. Douglas House

State Rep. Douglas House (R-North Little Rock), said Gov. Asa Hutchinson could sign the bill into law as early as today.

The Arkansas Chamber of Commerce had opposed Hutchinson's call to eliminate the fund, which pays benefits to claimants when the cost exceeds 325 weeks of benefits. That translates into a maximum liability of $209,950 at the current maximum weekly rate of $646.

Workers' Compensation Commission Chief Executive Officer Barbara Webb told the Arkansas Democrat-Gazette that the fund has assets of $11.6 million, but future benefits are projected to cost $242.5 million. Unless the legislature took action, she said, the fund would become insolvent in six to 12 years.

State lawmakers told the Democrat-Gazette and Times-Record that Arkansas is the only state that still operates a trust fund to pay permanent disability and death benefits. Several states that had similar funds in the past have eliminated them.