Kansas: Workers' comp benefits have not kept pace with cost of living, study finds

Workers' compensation benefits for employees injured in Kansas have fallen far behind the cost of living, according to a study.

The study -- The Eroding Value of Workers' Compensation Benefit Cap Levels -- was commissioned by the Kansas Association of Justice, a collective of labor organizations and attorneys who represent injured employees. The group is hoping the research, which was conducted by the Kansas University Institute for Policy and Social Research, can be used in the 2009 legislative session to persuade state lawmakers to boost workers' comp benefits.

"Worker compensation benefits depend on factors such as the extent of a worker's wage level and the extent of his injuries," the report stated. "However, benefits are capped at fixed dollar amounts. Benefit caps are not adjusted on a regular basis. As each year goes by, the maximum allowable benefits go less and less far towards supporting an injured worker and her family."

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According to the study, caps for total disability, partial disability, and temporary total disability have not been adjusted in Kansas since 1987. The functional-only cap has been set at $50,000 since 1993, and the death benefit cap has been set at its current level of $250,000 since 2000.

Each year, the Kansas Department of Labor computes a statewide average weekly wage, which is used to peg maximum weekly workers' comp benefits -- at two-thirds of the average wage per worker. But while wage growth is reflected in the growth of maximum weekly benefits, researchers said it does not affect benefit caps.

"As wages rise and caps remain constant, this means that many injured workers will reach their benefit caps in fewer weeks," the report stated.

When researchers examined wage earners and clerical workers in Kansas City, they found that benefits that were capped in 1987 would need to increase by about 77 percent to adjust for inflation. In addition, benefits that were capped in 1993 would need to increase by about 44 percent, and benefits capped in 2000 by about 21 percent.

Researchers also used data from the Kansas DOL to measure changes in the average wage level and estimate how much benefit caps would need to change in order to track wage growth. According to the study, benefits that were capped in 1987 would need to increase by about 107 percent to match wage growth, benefits that were capped in 1993 would need to increase by about 66 percent to match wage growth, and benefits capped in 2000 by about 32 percent.

"The two methods differ somewhat in their exact dollar estimates," researchers said. "However, they both tell the same story -- that maximum workers' compensation benefits have eroded substantially over time."

November 4, 2008

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