Oregon Workers' Compensation Benefits and Sources of Coverage

This chapter covers the benefits Oregon’s Workers’ Compensation Law provides, the program that helps employers hire workers with disabilities, and the sources of coverage for an employer the regular market will not insure or that chooses to insure itself.

Several benefits are tied to the state average weekly wage (AWW), which the Employment Department calculates each year from wages in covered employment in Oregon (ORS 656.211). Benefit amounts are therefore stated as percentages of the AWW, not as fixed dollar figures, and the law in force on the date of injury governs the benefits for that injury (ORS 656.202).

Benefits provided (ORS 656.202 to 656.262)

“Compensation” includes all benefits, including medical services (ORS 656.005(8)). A subject worker receives compensation whether the employer complied with the law or not (ORS 656.202).

Medical benefits (ORS 656.245)

The insurer or self-insured employer provides medical services for conditions caused in material part by the injury, for as long as the nature of the injury or recovery requires. Covered services include medical, surgical, hospital, nursing and ambulance services, drugs, crutches, prosthetic appliances, braces and supports, and physical restorative services. The duty to provide them continues for the life of the worker, though services after the worker’s condition is medically stationary are covered only in listed cases, among them services for a worker found permanently and totally disabled, prescription medications, prosthetic devices, braces and supports, services needed to diagnose the worker’s condition, and care under an accepted aggravation claim (ORS 656.245(1)(c)).

The worker chooses an attending physician in Oregon, and may change attending physician two times without the Director’s approval. For any later change, the insurer or self-insured employer may require the Director’s approval. Since April 7, 2026, nurse practitioners and physician associates qualify as attending physicians along with doctors and physicians; chiropractors and naturopaths may serve only for a limited period. A worker enrolled in a managed care organization receives care as the MCO contract provides. The three-day waiting period described below applies to disability payments, not to medical benefits.

Temporary total disability (ORS 656.210)

A worker who is totally unable to work for a time receives temporary total disability (TTD) benefits:

Date of injury	TTD benefit
Before January 1, 2027	66-2/3 percent of wages, up to 133 percent of the AWW
On or after January 1, 2027	75 percent of the worker’s wage up to 75 percent of the AWW, plus 65 percent of the wage above 75 percent of the AWW, “but not more than 133 percent of the average weekly wage”

The minimum is the lesser of 90 percent of wages or $50 a week. Benefits rise each year with the AWW.

Waiting period. No temporary disability is paid for the first three calendar days after the worker leaves work or loses wages because of the injury. The three days are paid if the total disability lasts 14 consecutive days, or if the worker is admitted to a hospital as an inpatient within 14 days (ORS 656.210(3)).

Payment timing. The first installment is due no later than the 14th day after the employer has notice or knowledge of the claim and of the disability, if the attending physician authorizes it, and later installments at least every two weeks (ORS 656.262(4)(a)).

Temporary partial disability (ORS 656.212)

A worker who can work but earns less because of the injury receives temporary partial disability: the proportion of the TTD benefit that the lost wages bear to the worker’s wage. The same three-day waiting period applies.

Permanent partial disability (ORS 656.214, 656.216)

Permanent partial disability (PPD) compensates for permanent impairment that does not permanently keep the worker from regularly performing gainful and suitable work.

• A worker released to, or back at, regular work receives an award for impairment only
• A worker who is not receives an award for impairment plus work disability, which adjusts the impairment for the worker’s age, education and adaptability to perform a given job
• Impairment is expressed as a percentage of the whole person, and the law caps it for scheduled losses: for example, no more than 60 percent for the loss of one arm at or above the elbow, and no more than 47 percent for the loss of one hand

PPD is paid in addition to any temporary disability benefits the worker received.

Permanent total disability (ORS 656.206, 656.208)

Permanent total disability (PTD) is the loss of use or function of any part of the body that permanently keeps the worker from regularly performing work at a gainful and suitable occupation.

Date of injury	PTD benefit
Before January 1, 2027	66-2/3 percent of wages, at least 33 percent and no more than 133 percent of the AWW
On or after January 1, 2027	75 percent of the worker’s wage up to 75 percent of the AWW (not less than 33 percent of the AWW), plus 65 percent of the wage above 75 percent of the AWW, “but not more than 133 percent of the average weekly wage”

The worker must prove PTD, including a willingness to work and reasonable efforts to find work. The insurer reexamines each PTD claim at least every two years. If a worker dies while permanently and totally disabled, from any cause, the beneficiaries receive death benefits (ORS 656.208).

Death benefits (ORS 656.204)

When a work injury causes death:

• Funeral and burial costs are paid, up to 20 times the AWW
• The surviving spouse receives a monthly benefit of 4.35 times 66-2/3 percent of the AWW until remarriage (or cohabitation of the kind the statute describes). On remarriage, the spouse receives a final lump sum of 36 times the monthly benefit
• Each child under 19 receives a monthly benefit of 4.35 times 25 percent of the AWW, and children’s benefits together are capped. A child aged 19 to 26 who is in school may receive up to 48 more months of benefits
• Other dependents receive a share of the support they actually received from the worker

Vocational assistance (ORS 656.258, 656.340)

A worker who cannot return to the job at injury, or to other suitable work with that employer, and who has a substantial handicap to employment, is eligible for vocational assistance to help return to work. The insurer pays vocational assistance providers within 60 days of their billing.

Workers’ Compensation Handicapped Workers Program: the Workers with Disabilities Program (ORS 656.628)

ORS 656.628 establishes the Workers with Disabilities Program, to encourage employers to hire and keep workers with disabilities.

• A worker with a disability has a permanent physical or mental impairment, from birth, injury or disease, serious enough to prevent the worker from obtaining or keeping employment
• After a claim, the employer applies to the Director. If the Director finds that the disability caused a later injury, made it substantially worse, or led a co-worker with a disability to cause it, the Workers’ Benefit Fund may reimburse the insurer or self-insured employer for compensation above $1,000 per claimant, for later injuries throughout the worker’s career
• Reimbursed amounts are excluded from rate making and from the employer’s experience rating, so those claim costs do not count against the employer’s loss experience. Reimbursement is discretionary and limited to the money available in the fund

The separate Preferred Worker Program (ORS 656.622) helps workers whose permanent disability from a work injury keeps them from returning to their regular job. For the first three years after a preferred worker is hired, no premium is payable for that worker, and the claim costs for the worker’s injuries are reimbursed to the employer’s insurer (or to a self-insured employer).

Sidenote

Know this...

You may see this program called the Handicapped Workers Program. ORS 656.628 now names it the Workers with Disabilities Program. Both it and the Preferred Worker Program are paid for by the Workers’ Benefit Fund, which is financed by an hourly assessment shared by employers and workers.

Other sources of coverage

Oregon Workers’ Compensation Fund Insurance Plan: the assigned risk plan (ORS 656.730; OAR 836-043-0001 to 0091)

Some employers cannot find an insurer willing to cover them in the voluntary market. ORS 656.730 requires the Director to maintain an assigned risk plan that apportions those employers fairly among SAIF and the private insurers that write workers’ compensation. An insurer that refuses its share loses its authority to write workers’ compensation. The Director’s rules name the plan the Oregon Workers’ Compensation Insurance Plan (WCIP).

• Administrator: the National Council on Compensation Insurance (NCCI) is the Plan Administrator. It assigns employers randomly and equitably to servicing carriers, which issue and service the policies
• Who may apply: an employer entitled to coverage that cannot obtain a reasonable offer of voluntary coverage. The employer must have received a declination from at least one insurer within the 60 days before applying, from its current insurer if it has one (a cancellation or nonrenewal counts). An employer that owes undisputed premium on earlier workers’ compensation coverage is not eligible
• Producers: any producer licensed for property and casualty insurance may place business with the Plan. For Plan business, the producer acts for the employer, not for the Plan or the servicing carrier, and is paid a fee by the servicing carrier on premium actually collected
• Binding: if the Plan Administrator does not issue a binder within 14 days after receiving a complete application and the premium, coverage is bound anyway
• Leaving the Plan: a voluntary insurer may take an employer out of the Plan at any time

Self-insured employers and employer groups (ORS 656.403, 656.407, 656.430)

An employer may self-insure instead of buying insurance. A self-insured employer directly assumes the responsibility for paying compensation to its workers (ORS 656.403), and is subject to the Director’s rules for handling claims.

To qualify, the employer must show the Director that it has (ORS 656.407):

• An adequate staff qualified to process claims promptly
• The financial ability to pay all compensation promptly, shown by acceptable financial viability
• Security acceptable to the Director, at least equal to the employer’s normal expected annual claim liabilities and never less than $100,000 (certain public employers may keep a loss reserve account instead). The Director holds the security and may raise or lower it. Posting security does not relieve the employer of its primary responsibility for the claims

The Director then issues a certificate, and coverage begins on the certification date unless the certificate specifies a later date (ORS 656.430). A self-insured employer must also carry excess insurance with an authorized insurer and maintain a safety and loss control program.

Self-insured employer groups. The Director may certify five or more subject employers as a self-insured employer group, which is treated as one employer (ORS 656.430(7)). The group as a whole must meet the staffing, financial and security requirements; its members are generally jointly and severally liable for its claims; it must be organized as a corporation, cooperative or public entity, with fidelity bonds; and it must provide centralized claims processing.

Federal laws

Workers for whom federal law provides a rule of liability for work injuries, whether a federal compensation act or a federal negligence law, are nonsubject workers under Oregon law (ORS 656.027(4)). The principal federal laws, the Longshore and Harbor Workers’ Compensation Act, the Jones Act, the Federal Employees’ Compensation Act and the Federal Employers’ Liability Act, are covered in the Business Owners Policy (BOP) and Workers Comp chapter. In Oregon, SAIF may insure an employer’s liability under the Longshore and Harbor Workers’ Compensation Act (ORS 656.044). The assigned risk plan places Longshore Act coverage, and coverage under its extension acts, with a carrier authorized by the U.S. Department of Labor.

Lesson summary

• Benefits are measured against the state average weekly wage and follow the law in force on the date of injury.
• Medical benefits have no waiting period and last for the worker’s life. The worker chooses an attending physician, who may be a nurse practitioner or physician associate, and may change twice without approval.
• TTD is 66-2/3 percent of wages (up to 133 percent of the AWW) for injuries before January 1, 2027, and a two-tier 75/65 percent formula for later injuries. No temporary disability is paid for the first 3 days unless total disability lasts 14 consecutive days or the worker is admitted as a hospital inpatient within 14 days.
• The first temporary disability payment is due within 14 days, then at least every two weeks.
• PPD pays for permanent impairment, plus work disability for a worker not back at regular work. PTD pays for permanent inability to regularly perform gainful work; for injuries before 2027 it is 66-2/3 percent of wages, no less than 33 percent and no more than 133 percent of the AWW.
• Death benefits include funeral costs up to 20 times the AWW, a spouse’s monthly benefit until remarriage (then a lump sum of 36 months), and benefits for children under 19.
• The Workers with Disabilities Program reimburses compensation above $1,000 per claimant for later injuries of a worker with a disability (ORS 656.628).
• Employers unable to get voluntary coverage use the assigned risk plan, the Oregon Workers’ Compensation Insurance Plan administered by NCCI (ORS 656.730).
• A self-insured employer needs claims staff, financial ability and security of at least $100,000 (or, for certain public employers, a loss reserve account), and is certified by the Director. Five or more employers may self-insure as a group (ORS 656.403, 656.407, 656.430).