The Second Injury Fund provides much needed benefits to injured workers. The Fund provides benefits to workers that have a permanent disability or injury prior to their work related injury. For example, if an employee has an amputated right hand at the time he is hired, and later he suffers a work related injury that causes him to lose the use of his left hand, the worker would likely be permanently and totally disabled because he has lost the use of both hands. The employer is only responsible to pay benefits for loss of the left hand (a permanent partial disability). The Second Injury Fund is responsible for paying additional benefits to reflect the fact that the employee is actually permanently and totally disabled as a result of the pre-existing injury to the right hand.
The Fund is also responsible for paying medical bills of an injured employee when the employer fails to insure its workers’ compensation liability. Second Injury Fund also provides benefits to an injured employee with multiple jobs. If an employee is unable to work at a job as a result of an injury that occurred while working at another job, benefits may be claimed from the Second Injury Fund in connection with the job at which the employee was not injured.
The Second Injury Fund is funded by a surcharge applied to workers’ compensation insurance premiums paid by employers. The Missouri legislature has capped the amount of the surcharge paid by employers, which has caused the Second Injury Fund to be underfunded. Unless the Missouri legislature acts, in the near future, the Fund will become insolvent and unable to pay claims.
Fund insolvency is near. In 2009, the Missouri Attorney General's Office issued a memo to attorneys, saying "effective immediately, unless an offer has been previously accepted, all Second Injury Fund offers are withdrawn.” Missouri Attorney General Chris Koster said the decision was made because the solvency of the fund is "in question." According to Koster, current fund revenues will cover settlements it has already made, but that "new obligations upon the fund could potentially push the fund past solvency."
"Therefore, given information currently available, our office has determined it is in the best interests of existing claimants and the state that no new settlements be entered into until a greater understanding of the fund's solvency is reached and until further consultations with executive and legislative leaders are completed," he said in the statement.
As a result of its looming insolvency, the Fund is paying only amounts it is ordered to pay through the litigation process. Even these payments will soon be in jeopardy if the legislature does not act. Contact your local state legislator and encourage him or her to remove the cap on the premium surcharge so that the Second Injury Fund can continue to pay worthy claims.
