Colorado's system of workers' compensation is compulsory, meaning that employers are required to provide workers' compensation insurance to their employees. Workers' compensation insurance may be provided through private insurance carriers, a competitive state fund, or self-insurance. Waivers may be permitted to exclude certain employees from coverage, including corporate officers. Sole proprietors may elect to be covered.
Exemptions from coverage may apply to certain employees, including agricultural workers, domestic employees, casual workers and independent contractors.
Medical Benefits are provided to employees entitled to workers' compensation benefits. Treatment provided must be reasonable and necessary, and is subject to established treatment guidelines. Authorization must be obtained before workers' compensation coverage will be available for treatment beyond the established guidelines.
The employee makes an initial choice of physician from a list of two physicians provided by the employer. The employee may change physicians with the employer's permission, upon referral by the treating physician, or where the employee requests a change and the insurance company fails to issue a timely written response.
Indemnity benefits are payable to injured workers to help make up for lost income. There is a waiting period of 3 scheduled days before a worker is eligible for indemnity benefits, but if the worker's disability lasts more than 14 days indemnity benefits become retroactive to the date of the injury. The waiting period is waived for injuries involving hospitalization or amputation.
Benefits available to injured workers include the following:
Temporary Total Disability (TTD)
Temporary total disability (TTD) benefits are paid to workers who are unable to work due to injury, but who are expected to make full or partial recovery such that they may return to work. Benefits are based upon 2/3 of the employee's pre-injury wage, subject to a cap, and continue for up to the duration of the temporary disability. Offsets may apply for other benefits received by the injured worker, including Social Security benefits and unemployment insurance.
Permanent Total Disability (PTD)
When a worker is not expected to recover from a total disability caused by a work-related injury, and as a result suffers a total loss of earning capacity, the worker becomes eligible for permanent total disability (PTD) benefits. In Colorado PTD benefits are calculated based upon 2/3 of the injured worker's pre-injury weekly wage, subject to a cap, and may continue indefinitely. Offsets may apply for certain benefits received by the injured worker, including Social Security and unemployment insurance.
Permanent Partial Disability (PPD)
Once an injured worker has recovered to the maximum possible extent, the worker may be able to return to employment but nonetheless remain partially disabled, and may potentially qualify for permanent partial disability (PPD) benefits. In Colorado PPD benefits may be determined based on a statutory schedule. Benefits for unscheduled injuries are calculated based upon the injured worker's impairment rating, the injured worker's age, and the amount of the injured worker's TTD benefit, and a fixed factor of 400 weeks.
Temporary Partial Disability (TPD)
When a worker suffers an injury that limits his ability to return to work, resulting in a reduction of income as a result of reduced hours or wages, the injured worker may be eligible to receive a benefit based on the difference between the worker's pre-injury earnings and their reduced, post-injury earnings. In Colorado, TPD benefits are paid based upon 2/3 of the difference between the injured worker's pre-injury and post-injury wage, subject to a cap, and may continue until the worker's restrictions end, the worker's earnings recover or the worker reaches maximum medical improvement.
For some, more serious injuries, workers' compensation indemnity benefits may be paid according to a statutory schedule, instead of following the standard model of the weekly benefit based on the duration of the disability. Scheduled injuries include such injuries as the amputation of an arm, the loss of a dominant hand, the loss of a leg, the loss of a foot, the loss of an eye, or loss of hearing in an ear.
Coverage may be available for cumulative trauma, disfigurement, mental stress and occupational hearing loss.
When a worker dies as the result of a work-related injury, workers' compensation pays additional benefits, including a burial allowance, and benefits for a surviving spouse and dependents. Survivor benefits are calculated based on 2/3 of the worker's average weekly wage. Spousal benefits end upon remarriage, but the spouse receives a lump sum benefit upon remarriage. Benefits to minor children may continue until the age of 18, the age of 21 if the recipient is a student, or indefinitely in the event of disability.
Attorney fees are paid out of the injured worker's benefits, subject to review for their reasonableness. There are no statutory limits on fee awards, although a fee in excess of 20% of the award is presumed unreasonable.
This article provides a quick overview of the benefits available to injured workers, but the full formulas used for assessment of benefits, coordination of different types of benefits, and assessment of injuries and disability ratings can quickly complicate the determination of benefits. Also, states frequently revise their workers' compensation laws. Most workers who suffer a significant injury or wage loss as the result of a workplace injury will benefit from consulting a workers' compensation lawyer.
The state agency responsible for workers' compensation is:
Colorado Department of Labor and Employment
Division of Workers' Compensation
633 17th Street, Suite 400
Denver, CO 80202-3660
(303) 318-8700 or 1-888-390-7936