A contractor's employee is injured on the job, resulting in $25,000 in medical expenses and 6 weeks of lost wages at $800/week. What is the total workers' compensation claim?
Correct Answer
B) $29,800
Total claim = Medical expenses ($25,000) + Lost wages (6 weeks × $800 = $4,800) = $29,800. Workers' comp covers both medical costs and wage replacement.
Why This Is the Correct Answer
Workers' compensation covers two components: (1) Medical expenses: $25,000, and (2) Lost wages: 6 weeks × $800/week = $4,800. Total claim = $25,000 + $4,800 = $29,800. Workers' comp in Michigan covers both the full medical costs and a wage replacement benefit.
Why the Other Options Are Wrong
Option A: $30,200
$30,200 results from an arithmetic error — possibly calculating 6 weeks × $800 as $5,200 (using the wrong number of weeks or rate) instead of $4,800, then adding to $25,000.
Option C: $25,000
$25,000 accounts only for the medical expenses and completely ignores the lost wage component. Workers' compensation is not limited to medical bills; wage replacement is a core benefit.
Option D: $32,600
$32,600 is too high and likely results from using an incorrect wage calculation (perhaps calculating more weeks or a higher rate) or adding an additional incorrectly derived figure.
Memory Technique
Workers' comp = Medical Bills + Lost Pay. Always add both. Use the formula: WC Total = Medical + (Weeks × Weekly Wage). Here: $25,000 + (6 × $800) = $25,000 + $4,800 = $29,800.
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