A Reminder on the Change of TD and PD Rates

Saturday, December 6, 2003 | 0

While Sue Hutchings is a Technical Supervisor for the defense law firm of McDermott and McNamara, the editors felt that the information in her article on disability indemnity rates was of importance to injured workers.

This is just a reminder to keep LC 4661.5 in mind regarding the "two year rule" for payment of Temporary Total Disability benefits: (This also applies to VRMA and death benefits but does NOT apply to 100% PD payments).

"When any TTD payment is made two years or more from the date of injury, the amount of this payment shall be computed in accordance with the temporary disability indemnity average weekly earnings amount specified in LC 4453 in effect on the date each TTD payment is made unless computing the payment on this basis produces a lower payment because of a reduction in the minimum average weekly earnings applicable under Section 4453."

As you know, the new maximum TD benefit rate took effect 1/1/03 (up to $602) and is again going up as of 1/1/04 (up to $728). There were also changes in the minimum rates as well. This is a potential source for penalties that can arise, especially when retroactive periods of TD are due and paid. (see chart below).

Make sure both requirements exist (a TD payment being made 2 years from the DOI, AND a new benefit rate in effect). If payment at a higher benefit rate is being considered, make sure the earnings support it. Also, take caution not to automatically pay at the new maximum rate instead of a correct rate that falls in between the old maximum and the new one.

An additional reminder:

In addition to TD rates going up, PD minimum and maximum rates have gone up effective 1/1/03 and 1/1/04. The date of injury and earnings are even more important to consider when assessing benefit rates for initial file reviews.