Permanent Partial Disability

Permanent partial disability (PPD) is the workers comp benefit that pays for the lasting damage to your body, after the doctor concludes that further treatment will not meaningfully improve your condition. PPD is the bridge between the temporary weekly check that paid you while you healed and the final settlement that closes the case. It is also the most state-variable part of workers comp. The same shoulder injury with the same impairment rating can produce dramatically different PPD awards in different states.

This page covers the PPD mechanics: where the rating comes from, how the rating turns into a dollar number, the difference between scheduled and unscheduled states, and the choices that affect the final award.

The impairment rating

PPD starts with an impairment rating. The treating physician, after declaring maximum medical improvement, assigns a percentage that represents the permanent loss of function. The rating is calculated using a published reference, almost always the AMA Guides to the Evaluation of Permanent Impairment. State statutes specify which edition of the Guides applies:

  • Fourth Edition is still in use in some states (e.g., Texas).
  • Fifth Edition is the most commonly cited edition across the country.
  • Sixth Edition is used in a growing number of states (e.g., Tennessee, Montana, New Mexico).

The edition matters because the same diagnosis can produce different ratings under different editions. A lumbar fusion with residual radiculopathy can rate 10 percent under the Fifth Edition and 18 percent under the Sixth Edition, or vice versa depending on residuals.

The rating is supposed to be an objective number based on range-of-motion measurements, imaging, surgical history, and the Guides chapter for the injured body part. In practice the rating has range. Two physicians applying the same Guides edition to the same patient often produce different numbers. This is why the rating is the most contested medical opinion in any PPD case.

Scheduled vs unscheduled states

The next variable is how the state’s PPD statute is built. Two major approaches:

Scheduled states. The statute publishes a list of body parts with a number of weeks assigned to each. The rating is multiplied by the scheduled weeks. Result: a fixed number of weeks of PPD, paid at the weekly compensation rate. Most states are scheduled states for the body parts on the schedule, and use a different rule for unscheduled injuries.

Unscheduled or wage-loss states. Instead of a body-part schedule, the statute pays PPD based on the actual wage loss attributable to the permanent restrictions. The math is the difference between pre-injury earning capacity and post-injury earning capacity, paid for a defined period. Florida (post-2003 reforms), Pennsylvania, and a handful of others use wage-loss approaches for unscheduled injuries.

Hybrid states. Most states are hybrids: a schedule covers extremities (arms, legs, eyes, hearing, fingers, toes), and wage-loss or whole-person impairment covers the back, neck, internal organs, and brain.

The scheduled approach is mechanical: rating times weeks times rate equals dollars. The wage-loss approach is contested: the carrier and the worker fight over what the worker can earn in the post-injury labor market.

The schedule example

Worked example in a scheduled state. The state assigns 250 weeks to the arm. A worker has a 20 percent impairment to the right arm, weekly compensation rate of $700.

PPD weeks: 0.20 times 250 equals 50 weeks. PPD dollar value: 50 weeks times $700 equals $35,000.

The award is paid in weekly installments after TTD ends, or as a lump sum if the state allows commutation. The state’s lump-sum rules vary widely. Some states allow free commutation by agreement; others require the worker to show “best interest” before a judge.

Per-state schedules and body-part weeks live on the state pages on this site.

The wage-loss example

Worked example in a wage-loss state. A worker earned $1,000 a week pre-injury. Post-MMI, the doctor’s restrictions limit the worker to sedentary work paying $650 a week. The wage loss is $350 a week. The statute pays a percentage (often two-thirds) of that wage loss for a defined number of weeks.

Wage-loss PPD: two-thirds of $350 equals $233 a week, paid for a statutory period (often capped at a number of years post-MMI).

The wage-loss approach pays differently across the labor cycle. A worker who finds higher-paying work later in the period sees the benefit drop. A worker who cannot find work at all may shift to a higher temporary or total disability category.

The body-part question

Body-part schedules vary widely by state. A back injury in Georgia is unscheduled and rated on a whole-person basis (O.C.G.A. 34-9-263 covers permanent partial disability). A back injury in Florida is paid under a separate impairment income benefit schedule based on the rating percentage (Fla. Stat. 440.15(3)).

A worker comparing settlement values across states for the same back injury should not assume the numbers are comparable. They are not. The PPD math is built from the state’s specific statute, and the state’s specific statute is the only number that matters for that worker’s claim.

What raises and lowers the rating

A few common rating factors:

  • Surgery. Adds to the rating in most cases (see the does surgery increase workers comp settlement guide).
  • Hardware. Implanted hardware (e.g., fusion hardware, joint replacements) adds rating points under most Guides editions.
  • Range-of-motion loss. Measured on the day of the rating exam. The measurement technique matters.
  • Neurologic findings. Documented radiculopathy, neuropathy, or weakness adds rating points.
  • Functional capacity evaluation (FCE). An objective FCE that documents restrictions can support a higher rating.
  • Pre-existing condition. A pre-existing degenerative condition can reduce the rating, with the carrier arguing apportionment.
  • Failure to follow treatment. Documented noncompliance with prescribed treatment can affect the rating in some jurisdictions.

The rating is a medical opinion with a real range. Within that range, the doctor’s read of the Guides and the patient’s presentation on exam day produce different numbers.

Disputing the rating

A worker who believes the rating is too low has options:

  • Second opinion. A different physician reviews the medical records and conducts a separate exam.
  • Independent medical examination. The carrier has a statutory right to order an IME. The worker can also obtain one at their own expense (potentially reimbursed if the rating moves in their favor).
  • Agreed medical examiner. Some states have a procedure for the parties to jointly select a neutral examining physician whose opinion is binding.
  • Functional capacity evaluation. A separate exam that documents lifting, range of motion, and endurance limits, used to support a higher rating.

The cost-benefit is real. A second opinion runs $1,500 to $3,500. A one-point rating swing in a 250-week state at a $700 weekly rate is worth $1,750 per point. Two or more points of movement covers the cost.

How PPD gets paid

PPD payment varies by state:

  • Weekly installments. Many states pay PPD in weekly installments at the worker’s compensation rate, starting after TTD or TPD ends.
  • Lump sum at MMI. Some states pay the full PPD as a lump sum at MMI, often discounted to present value at a statutory rate.
  • Commuted lump sum. Most states allow the parties to agree to commute the weekly installments to a lump sum, subject to commission approval.
  • Settlement absorption. PPD is often rolled into a global Compromise and Release settlement that closes the case in one number.

The choice affects taxation only marginally because workers comp generally is not federally taxable under IRS Publication 525.

What PPD does not pay

PPD does not pay pain and suffering. It does not pay loss of enjoyment of life. It does not pay punitive damages. It is an actuarial pay-out for permanent functional loss, calibrated by the state legislature, not a tort recovery. Workers comp gave up the pain-and-suffering category in the grand bargain a century ago. See the workers comp vs personal injury guide for the trade-off.

Sources

Sources cited on this page