HB 114: WORKERS COMPENSATION PERMANENT PARTIAL IMPAIRMENT AND DEATH BENEFITS

A bill pertaining to permanent partial impairment (PPI) and death benefits, including increasing PPI from $177,000.00 to $255,854.00 (a 44% increase) via amendment and adding a new section to AS 23.30 wherein the employer is obligated to notify the personal representative of the employee’s estate of compensation available under AS 23.30.215, the statute of limitations for obtaining workers’ compensation benefits, and where to obtain a list of legal counsel and grief counselors who may be able to assist. Section 215(a) would be amended to increase dependents benefits rates for parents, grandchildren, brothers, and sisters to an aggregate of $255,854.00 (amount payable under AS 23.30.190(a) – a 1200% increase over the current aggregate of $20,000.00) and, in the event of no dependents, a lump sum payment to the decedents estate of $127,977.00 (50% of amount payable under AS 23.30.190). Further, this 50% lump sum payment would be subject to annual percentage increase in unison with the CPI for urban wage earners and clerical workers in Anchorage, Alaska.

WCCA Position & Talking Points:

The Committee opposes this bill as written. The Committee also opposes any interplay between benefits payable under AS 23.30.190 and any increases in any price or other indices:

  1. PPI benefits compensate an individual for permanent partial impairment, a relative assessment based on loss of function. The proposed legislation re-classifies the assessment as a loss of earning capacity (permanent partial disability, PPD), wholly inconsistent with the statute itself. PPI is paid to an employee regardless of whether there are any physical limitations due to the injury and the employee remains able to work.
  2. PPI benefits are not a wage replacement benefit and shouldn’t be adjusted for inflation.
  3. In the case of a decedent, the concepts of both PPI and PPD are fixed at the time of death. Additionally, death benefits are to assist people who were dependent on the employee for financial support at the time of death and, accordingly, no benefits should be paid to family members who were not dependent on the employee at the time of death. Workers’ compensation insurance is not a life insurance policy.