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Social Insurance Chapter 11

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Page 1: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Social Insurance

Chapter 11

Page 2: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Programs

• Social Security

• Medicare

• Unemployment Insurance

• Workers Compensation

Page 3: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Workers Compensation- History

• Employer liability laws– Need to prove employer’s negligence– Common law defenses

• Contributory negligence

• Fellow servant rule

• Assumption of risk

Page 4: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Workers Comp - Principles

• Absolute liability

• Partial but final indemnity

• Periodic payments

• Part of the cost of operations

• Mandatory insurance

Page 5: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Benefits

• Medical expenses

• Disability– Total/Partial– Temporary/permanent

• Survivor’s death benefits

• Rehabilitation

Page 6: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Features

• Employee cannot sue

• Benefits, coverage vary from state to state

• Benefits are mandated

• Some states have second injury funds

• Some states cover disability not related to the job (Compulsory Temporary Disability Laws)

Page 7: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Social Security/Medicare

• Old-Age, Survivors’, Disability, and Health Insurance

• Pay roll tax (15.3%)• Pay as you go system• Social security trust funds

– Old age and survivors– Disability– Hospital insurance– Supplementary insurance

Page 8: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Loss of benefits

• Dependency status

• Other income– Exempt income (pension, investment income)

• Taxation of benefits– Does not go into general revenue

Page 9: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Challenges

• Can the system go broke?

• Ratio of workers to retirees

• Political decision making

Page 10: Social Insurance Chapter 11. Programs Social Security Medicare Unemployment Insurance Workers Compensation

Unemployment insurance

• State plans

• Rationale for insurance

• Market failure argument

• “Employer paid” taxes

• Experience rating