Does Workers' Compensation Cover Your Health Insurance?

If you are an employee working in the United States, chances are you are covered by a workers' compensation insurance plan. Because workers' compensation costs you nothing and health insurance probably costs you a lot, and both pay medical benefits, you may wonder if you are doubly covered for the same thing. Though you may be tempted to drop you health coverage, it isn't wise to do so.

Purpose of Workers' Compensation

• Workers' compensation insurance provides immediate medical and other benefits to employees for injuries and illnesses they sustain while working and without assigning negligence to either the employee or employer. You are only covered by workers' compensation while you are an employee at a business, and only for workplace-related issues. Therefore, routine illnesses, chronic diseases, car crashes and other traumas are not covered by your workers' compensation policy unless they are a direct result of your job. For all these issues, you need a health insurance policy in order to receive medical benefits.

Health Insurance Exclusion

• As workers' compensation policies exclude all issues outside the workplace, many health insurance policies exclude workplace-related injuries and illnesses if you are eligible for workers' compensation. Because these two types of insurance provide many of the same benefits, they are written in such a way as to eliminate the possibility of collecting benefits from both simultaneously. For these reasons alone, workers' compensation does not act as a substitute for health insurance.

Dependents

• You can typically endorse your health insurance policy to include your spouse, children and other dependents as your state's laws allow. Workers' compensation, by contrast, applies only to you, as the employee. Therefore, if you have dependents who rely upon your health insurance policy to receive coverage if they are sick or injured, your workers' compensation coverage is worthless to them.

Medical Networks

• In an effort to control medical costs, many workers' compensation insurers assign claims adjusters, medical overseers or even their own doctors to control every aspect of your treatment when you suffer a workplace injury or illness. You may find the workers' compensation system significantly harder and more restrictive to navigate than your standard health insurance system, and you may not be permitted to see a physician of your choice. Your health insurance, by contrast, typically has some flexibility regarding the medical options that are available to you.