IMPAIRMENT RATING 101
Self-Study Module

Continuing Education Workbook (2 CEU hours available)

Instructions
This self-study module is designed as a learning program and encompasses the Texas Labor Code, Title 5, Subtitle A statutes and Texas Workers' Compensation rules and Appeals Panel decisions which pertain to the issues of impairment ratings.

Before continuing, please read the following instructions:

  1. Read and review each referenced section before answering the quiz questions at the end of the module.
  2. When you have completed the module, have a third-party witness/supervisor request from SORM, by phone or e-mail, the exam, third-party agreement, and scan tron answer sheet.
  3. Your third-party witness/supervisor will monitor you while you're taking the exam and will return the exam, scan tron answer sheet, and third-party agreement to SORM.
  4. The answer sheet will be scored and, upon achieving a passing score, you will be sent your continuing education certificate documenting the appropriate number of hours completed

Training Goal and Learning Objectives

Section A:
Paying or Disputing Impairment Ratings

Section B:
Calculation of Impairment Income Benefits

Section C:
Commutation of Impairment Income Benefits

Review Exercise

 

Goal:    Participants will be introduced to the process of paying or disputing impairment ratings from treating doctors, referral doctors or carrier selected doctors and the calculation of impairment income benefits.

Learning Objectives:

1.1.1 Participants will be able to identify the process of paying or disputing impairment ratings from treating doctors, referral doctors or carrier selected doctors.

1.1.2 Participants will be able to explain the formula for the calculation of impairment income benefits.

1.1.3 Participants will be able to explain the procedure for the commutation of impairment income benefits.


SECTION A:
PAYING OR DISPUTING IMPAIRMENT RATINGS

Objective 1.1.1    Participants will be able to identify the process of paying or disputing impairment ratings from treating doctors, referral doctors or carrier selected doctors.

REFERENCE SOURCES FOR SECTION A: TEXAS WORKERS' COMPENSATION ACT AND RULES.

An employee's entitlement to impairment income benefits begins on the day after the date of maximum medical improvement. The maximum medical improvement date can be reached medically as determined by the treating doctor or the date reached by statute, 104 weeks after the eighth day of disability, whichever is earlier. The carrier must pay the impairment benefits due within 5 calender from date of receipt. The cycle date for payment is the day after the MMI date.

An employee is not entitled to impairment income benefits unless evidence of impairment based on an objective clinical or laboratory finding exists. If the finding of impairment is made by a doctor and the finding is contested, a designated doctor or a doctor selected by the insurance carrier must be able to confirm the objective clinical or laboratory finding on which the impairment was based.

Rule 130.5(e) provides that the first impairment rating assigned to an injured worker is considered final if the rating is not disputed within 90 days after it is assigned. The 90 days runs from the date the parties become aware of the rating from TWCC. TWCC is to send a letter to the parties informing them of the MMI date and impairment rating (EE-19 Letter). Be sure to follow up with the TWCC field office handling the claim to be sure that a letter has been sent if you do not receive one. For ratings that have not be disputed by 3/31/00. This rule does not contain a good cause exception for the 90 day time frame to dispute the date of maximum medical improvement or the rating timely. For any ratings that fall outside the 3/31/00 date, the Rule 130.5 allows exceptions to the 90 day timeframe.

Compelling medical evidence of a new, previously undiagnosed medical condition or improper or inadequate treatment of an injury could mean that an initial certification is invalid and the finality provision of the rule wold not apply.

A party who asserts that an initial certification of maximum medical improvement and impairment rating has not become final under this rule has the burden to prove that egregious medical conditions existed that would render the rule inapplicable.

If a dispute exists as to whether the employee has reached maximum medical improvement or the impairment rating, the commission shall direct the employee to be examined by a designated doctor chosen by mutual agreement of the parties. By agreeing to a designated doctor, however, means that both parties cannot dispute the findings from that doctor and the decision is final. If the parties are unable to agree on a designated doctor, the commission shall direct the employee to be examined by a designated doctor chosen by the commission.

The report of the designated doctor has presumptive weight and the commission shall base its determination of whether the employee has reached maximum medical improvement on the report unless the great weight of the other medical evidence is to the contrary.

If the certification and evaluation are performed by a doctor chose by the carrier, the certification and evaluation shall be submitted to the treating doctor and the treating doctor shall indicate agreement or disagreement with the certification and evaluation. This is accomplished by sending the C21 letter to the claimant and the P3 letter to the treating doctor if the claimant is not being paid TIBs. If the claimant is receiving TIBs at the time of the certification, the adjuster will send the TWCC-34 form to both parties.


SECTION B:
CALCULATION OF IMPAIRMENT INCOME BENEFITS

Objective 1.1.2    Participants will be able to explain the formula for the calculation of impairment income benefits.

REFERENCE SOURCES FOR SECTION B: TEXAS WORKERS' COMPENSATION ACT AND RULES.

Impairment income benefits are paid at the rate of 70% of the employee's average weekly wage not to exceed 100% of the state average weekly wage nor less than 15% of the state average weekly wage.

To calculate the weekly compensation rate for impairment income benefits:

  1. Calculate the employee's average weekly wage.
  2. Multiply the average weekly wage by 70%.
  3. Check the income benefit chart to be sure the weekly rate calculated does not exceed the maximum rate for the fiscal year for that injury.

To determine how long the benefits will be paid, multiply the percentage of impairment by 3.

For example, an employee was injured on October 31, 1994. Total hours worked for the 13 weeks immediately preceding the injury was 520. The total gross pay was $ 6,400. The impairment rating given was 10%.

What is the average weekly wage, the impairment income benefit weekly amount and the duration of impairment income benefits? The calculation steps would be as follows:

  1. Fiscal year 1995.
  2. $6,400 Total Gross Pay 13 weeks = $492.30 AWW.
  3. $92.30 AWW x 70% = $44.61.
    ** The maximum impairment income benefit rate for FY 1995 is $330 per week. $344.61 is reduced to $30.
  4. $30 is the weekly impairment income benefit rate.
  5. 10% x 3 weeks = 30 weeks duration.

Impairment income benefits are a weekly benefit; however, effective December 31, 1999 Rule 130.11 now allows for the monthly payment of impairment income benefits. Upon the request of the employee, the insurance carrier and the employee may agree to change the weekly benefit to a monthly. This agreement must be in writing and is only required to be filed with the Commission if the Commission requests a copy.

To be valid, the agreement must include the following terms and conditions:

  1. The payment shall be effective the first calendar day of the month following the month in which the written agreement was entered into by the insurance carrier and the employee;

  2. The payment shall be issued on or before the seventh day of the month for which benefits are due;

  3. Weekly impairment income benefits shall continue through the end of the month in which the agreement was signed;

  4. Payment of the last week of impairment income benefits to transition from weekly to monthly shall be prorated to the end of the month to ensure the employee receives benefits through the last day of the month;

  5. If less than the maximum weekly compensation rate in effect on the date of the compensable injury is being paid, a completed Employer's Wage Statement must be included with the injured employee's copy of the written agreement;

  6. The monthly benefit amount shall be equal to the weekly compensation rate for impairment income benefits that the injured employee is entitled to multiplied by 4.34821; and

  7. The impairment rating and source of the impairment rating upon which payment of impairment income benefits is being based.

The employee and insurance carrier may not agree to the monthly payment of impairment income benefits until the impairment rating has been agreed to or has become final. Entering into an agreement under this section may not be used for the purpose of finalizing an impairment rating.

At any time after signing the agreement for the monthly payment of impairment income benefits, the employee or the insurance company may notify the other party in writing that it no longer agrees to the monthly payment. In this instance, the insurance carrier shall pay all accrued but unpaid impairment income benefits at the end of the current monthly cycle and shall continue paying weekly as and when they accrue and are due.


SECTION C:
COMMUTATION OF IMPAIRMENT INCOME BENEFITS

Objective 1.1.1    Participants will be able to explain the procedure for the commutation of impairment income benefits.

REFERENCE SOURCES FOR SECTION C: TEXAS WORKERS' COMPENSATION ACT AND RULES.

On some occasions an employee may wish to commute or lump sum the impairment income benefits rather than receive them monthly or accelerate the payments. This is allowed following the provisions of Section 408.128. COMMUTATION OF IMPAIRMENT INCOME BENEFITS. (a) an employee may elect to commute the remainder of the impairment income benefits to which the employee is entitled if the employee has returned to work for at least three months, earning at least 80 percent of the employee's average weekly wage. (b) An employee who elects to commute impairment income benefits is not entitled to additional income benefits for the compensable injury.


PRACTICE QUIZ

1. There is an entitlement to impairment income benefits only if there is evidence of impairment based on:

  1. Hearing Officer's decision.
  2. Agreement of 2/3 of the parties.
  3. Objective clinical or laboratory findings.
  4. Subjective clinical or laboratory findings.
  5. Agreement of all the parties.

2. Impairment income benefits begin to accrue:

  1. The day after the injury.
  2. On the day after the injured employee reaches maximum medical improvement.
  3. 104 weeks after the date of the injury.
  4. On the eighth day of disability.
  5. The day after they return to work.

3. If an employee has a 10% impairment rating, _____ weeks of impairment income benefits are paid?

4. If an employee elects to commute his/her impairment income benefits, they forfeit entitlement to:

  1. Jury awarded settlement.
  2. Supplemental income benefits for the compensable injury.
  3. Temporary income benefits for the compensable injury.
  4. Request a dispute resolution proceeding.

5. To determine how long the benefits will be paid, multiply the percentage of impairment by:

  1. 8.
  2. 14.
  3. 3.
  4. .025.

6. Entering into an agreement to pay impairment income benefits monthly may not be used for the purpose of:

  1. Finalizing an impairment rating.
  2. Avoiding payment of future income benefits.
  3. None of the above.
  4. Both A and B.

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