Maximum Compensation: The bill increase the maximum compensation, exclusive of medical benefits from $294,000 for FY 2003 to the total of 125 weeks of temporary total disability plus 100 degrees of permanent partial disability. The new maximum is estimated to be $463,354 for FY 2004.
It is difficult to determine the potential cost of these changes. PL 31-2000 included similar types of adjustments, although the magnitude of the adjustments were different. An actuarial analysis of these changes is being performed by the National Council on Compensation Insurance (NCCI). The results are not currently available. The note will be updated when NCCI finishes their analysis. NCCI estimated the impact of the provisions of PL 31-2000 to be a 3.6% increase in premiums for FY 2001. According to the Indiana Compensation Rating Bureau, premiums increased by 1.5% for 2001 and decreased by 7.4% for 2002. Premiums for workers’ compensation for 2000 were about $592 M.
The state is impacted as an employer. The state spent $3.1 M in FY 1997, $3.4 M in FY 1998, $3.7 M in FY 1999, $3.9 M in FY 2000, and $4.5 M in FY 2001 on worker’s compensation payments. The additional state cost would probably be similar to the 2001 cost of about $600,000.
Explanation of State Revenues: Worker’s Compensation Benefits Prior Injury: The bill provides for a credit to an employer for an assessment made to the Second Injury Fund for payment to an employee who was injured prior to January 1, 2003, and sustained a later period of disability entitling the employee to an increase in the average weekly wage. The impact would reduce revenue to the Second Injury Fund by an unknown amount.
Explanation of Local Expenditures: (Revised) Child Labor: The bill deletes the exemption from the rest break requirement for minors employed at camps operated by nonprofit entities. The impact of the bill on affected local entities is expected to be negligible.
The local impact for increase worker’s compensation and unemployment benefits would be the increase payments as an employer.
Explanation of Local Revenues:
State Agencies Affected: Department of Labor, Department of Workforce Development, Worker’s Compensation Board, and All State Agencies.
Local Agencies Affected: Camps and similar facilities operated by cities, towns, or counties.