Texas Department of Insurance

Severely Injured Workers: Supplemental Income Benefits in the Texas Workers' Compensation System (May 1996)

Executive Summary

• Supplemental income benefits (SIBs) are designed for injured workers suffering the most serious job related injuries. An injured worker is entitled to SIBs if he or she has a permanent impairment rating of 15 percent or more, has exhausted all other income benefits, and has been unable to return to work or attain employment at 80 percent of the preinjury wage.
• Because the oldest claims under the new law -- those resulting from 1991 and 1992 injuries -- are now reaching the level of maturity in which SIBs are paid, the number of claims resulting in SIBs payments has greatly increased in the last two years. There were 164 new SIBs cases in 1993. In 1995, there were 1,072.
• As of the end of 1995, 18 percent of potential SIBs cases from 1991 injuries had received SIBs payments.
• As of the end of 1995, the status of the remaining 82 percent of potential SIBs cases from 1991 injuries was as follows: approximately 8 percent were still receiving other benefits and about 74 percent were at least one month past scheduled impairment income benefits (IIBs) without having received SIBs. About 58 percent were at least 13 months beyond the end of scheduled IIBs without having received SIBs.
• Rough estimates of the number of future SIBs cases indicate that the number of new SIBs cases will increase to somewhere between 1,500 and 2,300 per year by 1997 -- roughly 1.3 to 2.1 times the number of SIBs that began during 1995.
• The average cost of a SIBs claim is estimated to be $105,600, of which 51 percent is due to medical costs and 49 percent is due to wage replacement (indemnity) payments.
• Of the $51,500 estimated cost for wage replacement, 39 percent is for temporary income benefits (TIBs), 24 percent is for IIBs, and 37 percent is for SIBs.
• Back injuries are seen more often in SIBs cases than in other claims involving wage replacement (47 percent of all SIBs cases vs. 32 percent of all indemnity claims).
• The construction industry accounts for a relatively high proportion of SIBs cases (22 percent of all SIBs cases vs. 14 percent in all wage replacement injuries).
• A large number of SIBs cases involved at least one dispute over the course of the claim: 65 percent had at least one dispute at the Benefit Review Conference level (BRC), 24 percent at the Contested Case Hearing level (CCH), and 7 percent at the Appeal Panel (AP) level of dispute resolution.
• "Entitlement to SIBs" was the dominant issue disputed in SIBs cases. Forty-five percent of SIBs cases were involved in entitlement disputes at the BRC level.
• At the BRC level, 48 percent of the SIBs entitlement issues disputed were resolved by a mutual agreement of the parties. Of the remaining SIBs cases, the benefit review officer decided in favor of the worker in 27 percent and in favor of the insurer in 12 percent. Thirteen percent were not resolved.
• At the CCH level, 7 percent of SIBs entitlement issues were resolved by a mutual agreement, 51 percent were decided in favor of the worker, and 42 percent were decided in favor of the insurer.
• At the AP level, 35 percent of SIBs issues were decided in favor of the injured worker; 42 percent were decided against the injured worker; 3 percent of the decisions were reversed in favor of the injured worker; 9 percent were reversed against the injured worker; 5 percent of the disputed issues were remanded back to the contested case level; and 5 percent of the issues involved untimely appeals.

For further information, contact: WCResearch@tdi.state.tx.us .
This page was last updated on December 9, 2002.