Does Inflation Affect My Workers’ Compensation Benefits?
Rising costs can eat away at your workers’ compensation benefits and mean that your medical care costs more. The experienced Riverside workers’ compensation lawyers at Heiting & Irwin can fight for you to get what you deserve when you have been hurt on the job.
Your financial situation today may not be the same as it is tomorrow, and it could be due to factors that are entirely out of your control. Inflation could affect your workers’ compensation benefits. California law accounts for this in many circumstances, and there are recent proposed changes in the law that could extend this treatment to when you are receiving permanent partial disability benefits.
Speak to the Riverside workers’ compensation attorneys at Heiting & Irwin to learn more about how you can qualify for benefits and how they impact your financial future. We will speak with you in an understanding and compassionate manner, knowing that you are going through an extremely difficult time period.
Your Workers’ Compensation Benefits Could Increase Due to Inflation
You cannot escape the fact that inflation has been on the rise for the past several years. Everywhere you turn, costs have increased, whether it is for rent or basic necessities at the grocery store. If you are receiving workers’ compensation benefits in California, you may be wondering whether your benefits increase along with inflation. In most cases, the answer is, it depends.
In California, some types of workers’ compensation benefits are tied to the annual rise in the Consumer Price Index. What this means is that you would receive more money each year based on the increase in inflation. There is a calculation that is performed at the beginning of each year. Although this can be helpful for injured workers, the annual increase in workers’ compensation benefits is backward-looking, forced to bear increased costs of living during the course of the year until benefits are recalculated at the start of the following 12-month period.
Not every type of workers’ compensation payment is subject to this rule. Your benefits would increase only if receiving the following types of payments:
- Permanent total disability
- Temporary total disability
- Life pension benefits
Workers who are receiving permanent partial disability payments do not receive an annual increase in their benefits. These payments have been capped at $290 per week, without any raise to account for recent inflation. There is pending legislation in the California Senate that would tie these benefits to inflation, just like the other types of payments. If this bill passes, those who are receiving permanent partial disability payments would get an annual raise each year.
Inflation Could Eat Away at Your Workers’ Compensation Settlement
A yearly rise in workers’ compensation benefits and inflation are things that you need to consider when you are negotiating a potential settlement. When you take a lump sum payment, you would be forgoing any annual raises in your benefits. However, you would also have the money in your hands up front, meaning that you could invest the money and potentially receive returns on your investment that are greater than the rate of inflation. You must discuss these things with a workers’ compensation lawyer when you are deciding whether to negotiate a settlement. At the very minimum, future inflation should impact the amount of your settlement.
When it comes to medical expenses, you would not have to worry as much about inflation. California publishes tables that determine how much providers are reimbursed for medical services. These tables undergo periodic revisions to raise the amount that providers receive. You would generally not have to fear that you would not be able to afford medical services because the provider assumes any risks of inflation when they agree to treat you.
However, you must consider inflation in medical costs when you are negotiating a workers’ compensation settlement that would pay you up front. Since the insurance company is no longer obligated to pay for your care, you would need to make sure that you receive enough money to cover your own medical expenses in the future. There is a very real chance that you could run out of money from your settlement when you still need medical care. Your workers’ compensation attorney could work to estimate the amount of money that you would need in the future to pay for medical care, and they would negotiate your settlement accordingly.
Contact a Riverside Workers’ Compensation Law Firm
If you have been injured on the job, the Riverside workers’ compensation attorneys at Heiting & Irwin can help. Schedule a free initial consultation with a Riverside workers’ compensation lawyer by calling us today at (951) 682-6400, or contact us here.
