How is Workers’ Comp Settlement Calculated in Colorado?

When a worker in Colorado sustains an injury or illness on the job, the workers’ compensation system is designed to provide benefits. While the process can seem complex, understanding how settlements are generally calculated can help clarify what to expect. A workers’ compensation settlement in Colorado aims to compensate an injured worker for various losses directly resulting from their work-related injury or illness.

Key Components of a Workers’ Comp Settlement

The final settlement amount in a Colorado workers’ compensation case is often a result of negotiations and takes into account several distinct factors. These typically include:

• Medical Expenses: This covers the costs of all necessary medical treatment related to the work injury. This includes past bills for doctor visits, hospital stays, surgeries, medications, rehabilitation, physical therapy, and any required medical devices. It also accounts for reasonably projected future medical care that may be needed due to the injury.
• Lost Wages (Temporary Disability Benefits): If the injury prevents the worker from performing their job duties, they may be eligible for temporary disability benefits. A settlement can account for income lost during the recovery period (temporary total disability or temporary partial disability) up until the point of Maximum Medical Improvement (MMI).
• Permanent Impairment Benefits (Permanent Partial Disability – PPD): Once a worker reaches Maximum Medical Improvement (MMI), a physician will assess the extent of any permanent physical impairment directly resulting from the injury. This assessment typically leads to a “Whole Person Impairment” rating. This rating is then used in a specific formula outlined by Colorado law to calculate a lump sum or structured payments for the permanent impact of the injury.
• Vocational Rehabilitation: If the work injury is severe enough to prevent the worker from returning to their pre-injury job, even with medical treatment, the settlement might include provisions for vocational rehabilitation. These services are designed to help the injured worker acquire new skills, education, or training to find suitable employment that accommodates their new physical limitations.
• Disfigurement: In certain cases where a work injury results in significant permanent disfigurement (e.g., severe scarring), additional compensation may be awarded as part of the settlement.

The Settlement Process

The calculation and finalization of a workers’ compensation settlement is generally a negotiation process. The employer’s workers’ compensation insurance carrier will assess the claim based on medical reports, wage records, and other relevant information. The injured worker, often with the assistance of their representative, will present their case for the full scope of benefits they believe they are entitled to.

The complexity of the injury, the extent of required medical treatment, the impact on the worker’s ability to earn a living, and the specific facts and evidence of the case all play a significant role in determining the potential settlement value. It’s important to remember that every workers’ compensation case is unique, and settlement calculations can vary widely based on individual circumstances and the specific details of the injury.