How Long Can a Workers Comp Claim Stay Open?
Whether you’re a CEO of a large corporation or a business owner of a newly established company, it’s crucial that you know the answer to the question, “how long can a workers’ comp claim stay open?” While some plans allow for claims to stay open indefinitely, it is, in most cases, more beneficial to keep the process short and quick.
Employers at companies of all sizes are legally required to have policies in place to make sure their workplaces are safe for their employees. But regardless of how well safety protocols are taken, accidents still happen. For these situations, businesses are required to purchase workers’’ compensation insurance—also known as workers’ comp—to aid employees who are hurt on the job.
Below, we dive into some of the most important things to know about how workers’ comp claims are handled and answer any questions on how long can an insurance claim stay open.
How Long Can a Workers’ Comp Claim Stay Open? The Basics
Before we can answer the question “How long can a workers’ comp claim stay open?”, it is important to review the basics of workers’’ compensation so that you can make well-informed decisions for your business.
What is Workers’ Compensation?
Workers’ compensation insurance provides medical assistance to employees who have been injured or who have fallen ill in the workplace. These provisions can include coverage of the following:
- Medical expenses
- Lost wages
- Ongoing care
- Funeral expenses
How Does Workers’ Compensation Work?
Workers’ compensation is meant to protect both the employer and the employee should an employee be injured on the job. Although it is a federal program, each state has its own set of rules and regulations so that proper coverage is provided.
Employees who file a claim for workers’ compensation insurance can only do so if their injury or illness occurs in the workplace. Common examples of workplace injuries include slipping or falling, straining the body from lifting a heavy object, or injuring oneself while operating machinery.
How is the Cost of Workers’ Compensation Determined?
Workers’ compensation costs are determined by how similar businesses in each state follow injury patterns and losses. Combined into “classes,” businesses are provided with rates based on the prior five years of costs due to injury.
A system called “experience rating” allows for some businesses that have a long history of safety in the workplace to pay lower premiums. Those businesses that have a history of injury in the workplace are considered “unsafe businesses” and are required to pay higher premiums.
What Businesses Need to Carry Workers’ Compensation Insurance?
Businesses in all states are required to provide their employees with workers’ compensation coverage.
Employers who do not provide workers’ compensation coverage can experience costly repercussions, including paying claims out of pocket, receiving fines, and in serious cases, possibly facing imprisonment. In most cases, they lose the right to conduct business in the state.
How to Report a Workers’ Compensation Injury
The first thing that should happen after a workplace injury is to make sure that the employee is okay and receives the necessary medical treatment. Once the employee is okay and any treatments are done, the workers’ comp insurance company must be contacted. It’s important to note the policy you have since many carriers require an incident to be reported within 24 hours. The date of the injury and the date of the report determines how long the claim remains open.
It’s important to note that some states have different workers’ compensation rules, so be sure that you are up to date on the guidelines of your state. If you are based in Louisiana, click here to learn more.
How are Workers’ Comp Claims Settled
There are two basic ways that workers’ comp claims are settled. Keep reading to learn more.
Compromise and Release
This type of settlement provide the injured employee with a single lump sum payment and typically takes only a few weeks to complete. This payment closes the case but also severs the relationship between the employee and the insurer. If they require additional medical treatments in the future, they must pay out of pocket. The claim cannot be reopened.
Stipulation and Award
This type of settlement means that the employee receives payments for the injury over a period of time, which is typically months but can also be years. Due to the ongoing payment, the relationship between the employee and the company remains, meaning that the employee can reactive the claim if their injuries require additional medical attention. However, as noted above, every state has different rules, so be sure to know how long you can reopen the claim in your state.
Additionally, it’s important to note that there is the possibility of a judicial ruling in workers’ compensation cases if the involved parties cannot come to an agreement on one of the above settlement types.
Why is it Beneficial to Close Workers’ Compensation Claims Quickly?
Closing workers’ comp claims quickly is not only beneficial so that the injured employee can be taken care of and that the benefits they require are available, but also it shows your employees that you take their safety seriously. Quickly filing and resolving the claims boost company morale and the overall culture of the workplace. With employee benefits being at the forefront of priorities for employees and feeling supported being one of the top desires, closing claims quickly is in the employer’s best interest.
Another reason it is beneficial to close workers’ comp claims quickly is that by handling any injuries early, the injured employee can receive an early diagnosis, which can prevent unnecessary medical treatment and decrease the overall claim cost.
How Long Can a Workers’ Comp Case Stay Open: Best Practices
In the interest of keeping your employees happy and closing these cases as quickly as possible, there are some best practices regarding workman’s comp cases that will prevent you from asking, “how long does a workman’s comp case stay open?”
Educate Your Team
An employee should never have to resort to external resources when asking questions like “how long can a workers’’ comp case stay open?” Investing heavily in employee education and training regarding administrative procedures such as these will go a long way in saving your company time, as well as preventing any potential misunderstandings or mistakes during the processes. Employees should receive the training necessary to properly report injury cases to the correct parties, know which cases to report and when, and how to follow up on these cases accordingly.
Invest in Human Resources
For some businesses, particularly smaller ones, it may seem tempting to save money by investing lightly in human resources. However, neglecting this aspect of your business may lead you to lose money in the long run when managers and employees are stuck asking simple questions like, “how long does a workers’ comp claim stay open?”
If your business doesn’t have the means necessary to invest in a dedicated human resources department, consider outsourcing your HR services. Canal HR has a reputation for supplying adept and reliable human resources services to hundreds of businesses, saving them both time and money when caring for their employees.
To avoid asking yourself, “how long does a workman’s comp case stay open,” planning ahead of time and creating processes for workman’s comp claims will save time, money, and headaches when dealing with unforeseen circumstances caused by workplace incidents or employee injury. Preventing confusion by implementing concrete processes helps create a healthier environment for employees looking to receive compensation for their time away from work.
As important as it is to implement comprehensive workman’s comp processes in the workplace, businesses must remain flexible and ready to deal with any unforeseen circumstances regarding workplace injury. As a business, you may want to urge your employees to return to work as soon as they are physically able- and you should. When doing this, however, you must keep your employees’ well-being in mind and offer flexible return plans, including lighter workloads, shorter days, or other accommodation options that will help them re-acclimate themselves to the workplace after an extended absence.
Prepare to Make the Tough Decisions
Businesses should always do anything they can to aid a worker that has been injured at the workplace. Among legal and wellness-related reasons, maintaining a generous workman’s comp policy will go a long way in employee retention and creating a positive workplace culture. In maintaining these policies, however, your business should be prepared to make tough decisions. There are employees that will take advantage of workman’s comp policies, and it’s essential to prepare for these circumstances- this is where the implementation of concrete rules and policies regarding these claims becomes necessary.
How Long Can a Workers’ Comp Claim Stay Open? Closing the Claim Quickly
Though each state has state-specific requirements for workers’ compensation, laws require that an employee file a claim for benefits within a certain amount of time following the injury or accident.
Once the claim is opened, employees and employers usually ask themselves how long can a workers’ comp claim stay open. There are two routes to take. Some workers’ compensation plans stay open indefinitely. In this case, the insurance provider pays for future medical bills related to the initial injury if they arise.
However, it is usually more beneficial to close the claim sooner rather than later. It’s often the case that employees can settle with the insurance provider on a lump sum of money to close the claim, referred to as a stipulated agreement.
It is an excellent advantage for the employee to receive money the insurance carrier provides. More often than not, this sum of money amounts to greater benefits received, and closing quickly can avoid excessive paperwork.
How Canal HR’s Workers’ Comp Plan Keeps Employees Safe and Costs Low
Canal HR has a reputation for being a regional leader in developing workers’ comp policies that keep company costs low. As a professional employer organization, Canal HR can help take the pressures of employer risk and workers’ comp policies off your shoulders so that you can spend more time on running your business and serving your customers. We help answer common questions like, “how long can a workers’ comp claim stay open?”
Here are some of the workers’’ comp and risk management services Canal HR experts provide:
- Eliminating workers’’ compensation down payments
- Negotiating and obtaining workers’’ compensation insurance coverage
- Investigating fraud
- Eliminating workers’’ compensation audit and audit premium
- Performing risk management safety inspections
- Providing periodic safety training
- Processing and managing workers’’ compensation claims
- Handling workers’’ compensation hearings
- Maintaining OSHA logs
- Coordinating a return-to-work program
By working with Canal HR, you will have a team of workers’ comp specialists to help you keep your employees safe, your costs low, and your business thriving. To speak with us about workers’’ compensation plans or other services that we provide, contact us today.