The Defense Base Act and the Longshore and Harbor Workers’ Compensation Act requires employers and insurance companies to pay benefits to injured employees. Initially, the injured civilian contractor or longshore worker receives temporary total disability benefits. As time passes, the employee may receive different disability classifications. Today’s post addresses the end a DBA or Longshore Act claim, when the employee receives permanent partial disability benefits. In short, I will show you how to calculate the dollar value of an impairment rating.
What are Permanent Partial Disability Benefits?
There are four types of disability benefits: temporary total, temporary partial, permanent total, and permanent partial. When an employee has reached permanent partial disability, this means:
- Their overall medical condition has reached a state of medical permanency. This is often referred to a maximum medical improvement, or MMI.
- They can return to their pre-employment work or the employer has demonstrated the availability of suitable alternative employment.
Typically, permanent partial disability is the end stage of a Defense Base Act or Longshore Act claim. Once an injured employee reaches PPD, the employer or its insurance company may be interested in settling the employee’s claim.
What is the Longshore Schedule of Benefits?
For this post, I am addressing only scheduled body parts. The “schedule” is located at Section 8(c) of the Longshore Act. If a body part is identified in the schedule, then permanent partial disability owed for any rating assigned to the body part must be based on the weekly allowance contemplated for the schedule. These are the body parts included in the schedule:
(1) Arm lost, three hundred and twelve weeks’ compensation.
(2) Leg lost, two hundred and eighty-eight weeks’ compensation.
(3) Hand lost, two hundred and forty-four weeks’ compensation.
(4) Foot lost, two hundred and five weeks’ compensation.
(5) Eye lost, one hundred and sixty weeks’ compensation.
(6) Thumb lost, seventy-five weeks’ compensation.
(7) First finger lost, forty-six weeks’ compensation.
(8) Great toe lost, thirty-eight weeks’ compensation.
(9) Second finger lost, thirty weeks’ compensation.
(10) Third finger lost, twenty-five weeks’ compensation.
(11) Toe other than great toe lost, sixteen weeks’ compensation.
(12) Fourth finger lost, fifteen weeks’ compensation.
(13) Loss of hearing:
(A) Compensation for loss of hearing in one ear, fifty-two weeks.
(B) Compensation for loss of hearing in both ears, two-hundred weeks.
(C) An audiogram shall be presumptive evidence of the amount of hearing loss sustained as of the date thereof, only if (i) such audiogram was administered by a licensed or certified audiologist or a physician who is certified in otolaryngology, (ii) such audiogram, with the report thereon, was provided to the employee at the time it was administered, and (iii) no contrary audiogram made at that time is produced.
(D) The time for filing a notice of injury, under section 912 of this title, or a claim for compensation, under section 913 of this title, shall not begin to run in connection with any claim for loss of hearing under this section, until the employee has received an audiogram, with the accompanying report thereon, which indicates that the employee has suffered a loss of hearing.
(E) Determinations of loss of hearing shall be made in accordance with the guides for the evaluation of permanent impairment as promulgated and modified from time to time by the American Medical Association.
(14) Phalanges: Compensation for loss of more than one phalange of a digit shall be the same as for loss of the entire digit. Compensation for loss of the first phalange shall be one-half of the compensation for loss of the entire digit.
(15) Amputated arm or leg: Compensation for an arm or a leg, if amputated at or above the elbow or the knee, shall be the same as for a loss of the arm or leg; but, if amputated between the elbow and the wrist or the knee and the ankle, shall be the same as for loss of a hand or foot.
(16) Binocular vision or per centum of vision: Compensation for loss of binocular vision or for 80 per centum or more of the vision of an eye shall be the same as for loss of the eye.
(17) Two or more digits: Compensation for loss of two or more digits, or one or more phalanges of two or more digits, of a hand or foot may be proportioned to the loss of use of the hand or foot occasioned thereby, but shall not exceed the compensation for loss of a hand or foot.
(18) Total loss of use: Compensation for permanent total loss of use of a member shall be the same as for loss of the member.
(19) Partial loss or partial loss of use: Compensation for permanent partial loss or loss of use of a member may be for proportionate loss or loss of use of the member.
(20) Disfigurement: Proper and equitable compensation not to exceed $7,500 shall be awarded for serious disfigurement of the face, head, or neck or of other normally exposed areas likely to handicap the employee in securing or maintaining employment.
What is an Impairment Rating and How is it Applied?
An impairment rating is an estimated loss of use of a body part. Typically, a physician assigns a percent loss of use of a body part as a result of the worker’s injury. The percentage is then multiplied by the number of weeks contemplated by the body part.
Let’s consider an injured leg. The Longshore Act’s schedule says that the highest number of weeks of compensation that an injured worker will receive for a work related impairment rating to their leg is 288 weeks. This means that, if an injured worker loses their leg in an injury thus suffering a 100% impairment, then the injured worker will receive 288 weeks in compensation.
Lesser impairment ratings receive fewer weeks of compensation. For example:
- A 5% impairment to the leg will entitle the worker to 14.4 weeks of compensation;
- A 10% impairment to the leg will entitle the worker to 28.8 weeks of compensation;
- A 25% impairment to the leg will entitle the worker to 72 weeks of compensation; and so on…
How is the Dollar Value of an Impairment Rating Calculated?
To calculate the actual dollar value of the impairment rating, first determine the injured worker’s average weekly wage. Once the AWW is determined, then calculate the compensation rate. A worker’s compensation is 2/3 of the average weekly wage. Now, find the impairment rating percentage applied to the worker’s injured body part and apply that percentage to the number of weeks contemplated by the schedule for that particular body part. Now, multiply the compensation rate to the number of weeks to which the injured worker is entitled. Then product is the dollar value of the impairment. Here are some examples.
A longshore worker earning $1,500 per week injured his arm at work. His compensation rate is $1,000 per week. The worker’s treating doctor assigned a 17% impairment to the worker’s arm. The Longshore Act says that the maximum number of weeks allowed for an arm injury is 312 weeks. Our longshore worker’s entitlement to permanent partial disability benefits for his arm injury is based on 53.04 weeks of compensation (which is 17% of 312 weeks). Now, multiply 53.04 weeks by the injured worker’s $1,000 per week compensation rate. For this example, the injured longshore worker is entitled to $53,040 of permanent partial disability benefits for his arm injury.
A Defense Base Act contractor earning $3,000 per week required a total knee replacement following a work related injury. His compensation rate is $1,377.02—not because $1,377.02 is 2/3 of $3,000, but because the contractor’s compensation rate is capped at the maximum rate. The contractor was assigned a 37% impairment to the leg because of his injury. The 37% rating comports with the American Medical Association’s Guides to the Evaluation of Permanent Impairment. Our contractor’s entitlement to permanent partial disability benefits for his leg injury is based on 106.56 weeks of compensation (which is 37% of 288 weeks). Now, multiply 106.56 weeks by the injured worker’s $1,377.02 per week compensation rate. For this example, the injured contractor is entitled to $146,735.25 of permanent partial disability benefits for his leg injury.
Is Additional Compensation Available?
The impairment rating contemplates only permanent partial disability benefits. Additional categories of disability benefits will be available based upon the inured worker’s medical treatment and ability to work.
Who to Contact if you Need Assistance?
Finally, disputes can arise regarding the amount of compensation owed for the impairment rating. Perhaps the injured worker and insurance company disagree about the percent impairment assigned to an injury, or about the injured worker’s average weekly wage and compensation rate. In the event this happens, contact an attorney for assistance. Jon Robinson at Strongpoint Law Firm can help with your permanent partial disability impairment rating dispute. He can be reached through the form on this page or by telephone at (985) 246-3194.