How PPD Settlements Are Calculated: Impairment Ratings & MMI

You were hurt at work, you went through treatment, and now your doctor says you have "reached MMI" and hands you a number: 12%, 15%, maybe 20%. A few weeks later the insurer calls with a settlement figure. The obvious question is whether that figure is fair, and to answer it you need to know how PPD settlements are calculated in the first place.

The short version is that most states turn your permanent impairment into money with the same three ingredients: an impairment rating, a number of weeks tied to the injured body part (or to the rating itself), and a weekly compensation rate based on your wages. The details, and the dollar amounts, change a lot from state to state.

This guide walks through each piece, runs the same 15% injury through six states' formulas, and covers future medical buyouts, lump sums, taxes, and when a lawyer is worth it.

TL;DR: A permanent partial disability (PPD) award is usually impairment rating × weeks × weekly comp rate. The weeks come from your state's schedule (for example, 240 weeks for an arm in North Carolina) or from a points-based table (Texas pays 3 weeks per percentage point). The comp rate is typically two-thirds of your average weekly wage, capped at a state maximum that changes every year. That formula is the floor of a settlement; a lump-sum deal often adds a price for future medical care and any remaining wage-loss exposure. For a quick estimate, plug your numbers into our free workers' comp settlement calculator. This article is general information, not legal advice, and the rates below are 2026 figures.

What PPD is (and how it differs from TTD and PTD)

Workers' compensation pays wage-loss benefits in stages, and PPD is usually the last stage.

• Temporary total disability (TTD): weekly checks while you are completely unable to work during recovery. In most states this is two-thirds of your average weekly wage (AWW), up to a state maximum.
• Temporary partial disability (TPD): a partial wage benefit when you are back on light duty but earning less than before.
• Permanent partial disability (PPD): compensation for a lasting loss of function that remains after you have healed as much as you are going to. You can receive PPD even if you are back at your old job, because it pays for the permanent injury, not only for missed paychecks.
• Permanent total disability (PTD): benefits for a worker who can never return to gainful employment. PTD is rarer and is calculated differently, often as ongoing weekly payments rather than a fixed number of weeks.

Some states use different names. Texas calls its PPD-type payment impairment income benefits (IIBs), Florida uses impairment income benefits too, California simply says permanent disability (PD), and Pennsylvania splits it into specific loss benefits and partial disability benefits. The logic underneath is similar.

MMI: the trigger for your PPD rating

Maximum medical improvement (MMI) is the point where your treating doctor decides your condition has stabilized and is not expected to get meaningfully better with more treatment. California's Division of Workers' Compensation uses the term "permanent and stationary" for the same moment and notes that doctors may call it MMI instead.

MMI matters for three reasons:

1. Temporary benefits usually wind down. TTD is meant for the recovery period, so once you are at MMI the insurer will look to stop or convert those checks.
2. Your impairment gets rated. The doctor examines you and assigns a permanent impairment percentage. In Florida, for example, the certifying doctor must evaluate you and assign a rating once you reach MMI (or six weeks before temporary benefits run out, whichever comes first).
3. PPD payments start. Texas says you may start receiving IIBs the day after you reach MMI, and Florida says impairment benefits are due within 14 days after the carrier learns of the impairment.

MMI does not mean you are pain-free or fully recovered. It means further improvement is not expected. If you still need medication, injections or a future surgery, that is the "future medical" part of your claim, which we cover below.

How impairment ratings work

An impairment rating is a doctor's percentage estimate of how much function you have permanently lost. It is the single biggest variable in a PPD settlement, which is why rating disputes are so common.

Most states anchor ratings to some edition of the American Medical Association's Guides to the Evaluation of Permanent Impairment (the "AMA Guides"), but not the same edition, and some use their own schedules:

• Pennsylvania requires the AMA Guides, 6th edition (second printing, April 2009), for impairment rating evaluations under Act 111 of 2018.
• Texas uses the AMA Guides 4th edition for most current claims under its rules (the state has circulated a draft rule to move to the Sixth edition, so check for updates).
• California uses the AMA Guides 5th edition to produce a whole person impairment, which is multiplied by 1.4 for injuries on or after January 1, 2013, then adjusted for occupation and age.
• Florida uses its own Uniform Permanent Impairment Rating Schedule, which Florida law requires to be based on the AMA Guides and other sources but more comprehensive.
• North Carolina gives doctors the Industrial Commission's own Rating Guide.
• Georgia's State Board tells workers the treating physician rates the impairment using the AMA Guides.

Two ratings of the same injury can differ by several points depending on the doctor and the edition used. That is why many states give you a way to challenge the number. In North Carolina, you are entitled to one second-opinion rating from a doctor of your choice at the employer's expense. In California, you can be evaluated by a qualified medical evaluator (QME) if you disagree with your doctor's findings.

A rating is not the same thing as "percent disabled." A 15% impairment of the arm is not 15% of your whole body, and in California the impairment number is converted into a separate disability percentage before it is paid.

How are PPD settlements calculated? The basic formula

In states that use a schedule, the core calculation looks like this:

PPD award = impairment rating × weeks for the body part × weekly compensation rate

Each piece works like this:

• Impairment rating: the percentage the doctor assigns (say, 15%).
• Weeks for the body part: the number of weeks your state's statute assigns to the total loss of that part. North Carolina assigns 240 weeks to an arm; Georgia assigns 225.
• Weekly compensation rate: usually two-thirds (66 2/3%) of your average weekly wage, but never more than your state's maximum weekly benefit for your date of injury.

Your AWW is built from your gross earnings over a set period before the injury (Georgia uses the 13 weeks before the accident, for example). Overtime, a second job, and sometimes the value of benefits can count, so it is worth checking how the insurer computed it. A lowball AWW quietly shrinks every benefit you receive.

Some states replace the "weeks for the body part" step with a points-based table. Texas pays 3 weeks for each percentage point of impairment. Florida pays 2 to 6 weeks per point depending on how high the rating is. California uses a sliding scale of weeks per percentage point. The multiplication is the same idea; only the source of the week count changes.

Scheduled vs. unscheduled injuries

Scheduled injuries are body parts listed in your state's statute with a fixed number of weeks: fingers, hands, arms, legs, feet, eyes, hearing. They are the easiest to calculate because the formula is mechanical.

Unscheduled injuries are everything else: the back, neck, often the shoulder, internal organs, brain injuries, and "body as a whole" ratings. States handle these in different ways:

• Georgia treats a whole-body impairment as worth 300 weeks.
• North Carolina lists the back at 300 weeks, and a 75% or greater loss of use of the back is treated as total.
• Some other states pay unscheduled injuries based on actual loss of earning capacity rather than a fixed schedule, which makes them harder to estimate and more likely to be negotiated.

Using a 15% rating and a $600 weekly comp rate, a whole-body or back rating in Georgia or North Carolina works out to 300 × 0.15 × $600 = $27,000, compared with about $20,000 for the same rating to an arm. The body part matters as much as the percentage.

15% permanent partial disability settlement: payout chart by state (2026)

To show how much the state matters, here is the same worker run through six states. Assume an average weekly wage of $900, which gives a standard two-thirds comp rate of $600 per week, and a 15% permanent impairment. Figures are rounded, ignore attorney fees, and use 2026 rates; every state updates its maximums on its own schedule.

North Carolina

North Carolina's schedule in G.S. 97-31 pays 66 2/3% of your AWW for a set number of weeks per body part: 240 for an arm, 200 for a hand or leg, 144 for a foot, 120 for an eye, and 300 for total loss of use of the back. Partial loss of use is paid in proportion, so a 15% arm rating is 240 × 0.15 = 36 weeks. The Industrial Commission's own example is a 20% index finger rating: 45 weeks × 0.20 = 9 weeks of compensation. The maximum weekly rate for injuries in 2026 is $1,446.

Georgia

Georgia pays PPD under O.C.G.A. § 34-9-263 at two-thirds of your AWW, using a schedule of weeks: 225 for an arm or leg, 160 for a hand, 135 for a foot, 150 for an eye, and 300 for the body as a whole. A 15% arm rating is 225 × 0.15 = 33.75 weeks. The State Board lists the maximum weekly benefit at $800 for accidents on or after July 1, 2023. Check the Board's current summary for your date of injury, since the legislature changes this figure periodically.

Texas

Texas does not use body-part weeks. You receive 3 weeks of impairment income benefits for each percentage point of your rating, paid at 70% of your AWW. So 15% equals 45 weeks, and 70% of $900 is $630 a week, for about $28,350. IIBs are capped at 70% of the state average weekly wage: $890 per week for injuries from October 1, 2025 to September 30, 2026, and $920 per week for injuries on or after October 1, 2026.

Florida

Florida pays impairment income benefits on a tiered scale for accidents on or after October 1, 2003: 2 weeks per point from 1% to 10%, 3 weeks per point from 11% to 15%, 4 weeks per point from 16% to 20%, and 6 weeks per point from 21% up. A 15% rating is (10 × 2) + (5 × 3) = 35 weeks. The weekly amount is 75% of your average weekly TTD benefit, and it is cut in half for any week you earn at least your pre-injury AWW. With a $600 TTD rate that is $450 a week, or $225 in weeks you are back at full wages. Florida's maximum weekly comp rate is $1,358 for 2026 injuries.

California

California converts your doctor's whole person impairment into a permanent disability rating using the Permanent Disability Rating Schedule, then pays a set number of weeks for each percentage point on a sliding scale under Labor Code § 4658(e) (for injuries on or after January 1, 2013): 3 weeks per point up to 9.75%, 4 weeks per point from 10% to 14.75%, 5 weeks per point from 15% to 24.75%, rising to 16 weeks per point at 70% and above. Calculated in quarter-point steps, a 15% rating is about 50.5 weeks.

The catch is the weekly rate. For injuries on or after January 1, 2014, PD is paid at two-thirds of AWW with earnings counted between $240 and $435, so the PD rate is between $160 and $290 per week whatever you earned. That is why California PD awards look small next to the state's 2026 TTD maximum of $1,764.11 per week.

Pennsylvania

Pennsylvania works differently. Specific loss benefits under Section 306(c) are paid for the amputation or permanent loss of use of a body part, not a percentage of it: 335 weeks for a hand, 410 for an arm or leg, 250 for a foot, and 275 for an eye, plus a healing period (20 weeks for a hand or arm). Pennsylvania also uses a wage-bracket rule: for 2026 injuries, anyone with an AWW between $774.44 and $1,045.50 gets a flat $697 weekly rate, so our $900 worker's total loss of use of a hand would be 335 × $697 = about $233,500, before the healing period.

For injuries that are not a specific loss, an insurer can request an impairment rating evaluation (IRE) after you have received 104 weeks of total disability benefits. If the rating is under 35% (AMA Guides 6th edition), benefits can be converted from total to partial disability, which is capped at 500 weeks. The 2026 maximum weekly rate is $1,394.

Why the settlement offer is not just the PPD number

The formula tells you what your PPD rating is worth if it is paid out as scheduled. A settlement is a negotiated deal, and the final number usually moves because of:

• Future medical care. Closing medical benefits is often the biggest item in a full settlement (see below).
• Disputed ratings. If your doctor says 15% and the insurer's doctor says 8%, the settlement often lands somewhere between, depending on the strength of each opinion.
• Remaining wage-loss exposure. If you cannot return to your old job, the insurer may be paying for the risk of future TTD, TPD or, in the worst case, PTD.
• Multiple body parts or injuries, including psychological conditions (Florida, for example, limits permanent psychiatric impairment to 1%).
• Attorney fees, which states cap and judges usually must approve.
• Offsets and liens, such as Social Security Disability offsets or unpaid medical bills.

If you want to see how these pieces stack up for your own numbers, the calculator linked in the summary above lets you enter your wage, state, rating, weeks off, and medical costs.

Future medical buyouts

Many settlements close out the insurer's obligation to pay for your future treatment in exchange for a lump sum. This is often called a future medical buyout, or in California a compromise and release (C&R).

California's DWC describes the choice clearly: a C&R resolves the whole claim for one lump sum, after which the claims administrator usually is not liable for further payments or medical care, while a stipulation with request for award usually pays money over time and keeps future medical treatment open. Most states have some version of both options.

Before you give up future medical rights, think through:

• What treatment you will realistically need: medications, injections, therapy, hardware removal, a future surgery, and how often.
• What that treatment costs at today's prices, and for how many years.
• How you will pay once the money is spent. After a full buyout, the comp insurer usually will not pay again for that injury.
• Medicare. If you are a Medicare beneficiary, or expect to be soon, Medicare's interests have to be considered. CMS reviews Workers' Compensation Medicare Set-Aside (WCMSA) proposals when you are already on Medicare and the settlement is over $25,000, or when you reasonably expect Medicare enrollment within 30 months and the total settlement is over $250,000. CMS says submission is recommended rather than required, but the thresholds are not a safe harbor: the duty to protect Medicare's interests applies either way.

A future medical buyout that looks generous today can look very different if you need a second surgery in five years. This is the part of a settlement most worth a second opinion.

Lump sum vs. structured payments

You typically have two ways to receive a PPD award or settlement:

Lump sum. One payment, usually after a judge or agency approves the settlement. You control the money, can pay off debt, and close the claim. The risk is spending it before your needs are met, and a lump sum can still be prorated against Social Security Disability benefits (see below).

Structured or periodic payments. Weekly or biweekly payments over the award period (Florida pays impairment benefits biweekly; California pays PD every two weeks). Payments over time can suit someone who wants steady income or who is using a structured annuity to fund future medical needs.

Neither is automatically better. The right choice depends on your health, your other income, your age, and whether you are giving up future medical rights.

Are PPD settlements taxable?

In most cases, no. IRS Publication 525 says workers' compensation you receive for an occupational sickness or injury is not included in your income. There are a few exceptions to know about:

• Return-to-work wages. If your employer pays part of your salary while you are back at work but not fully able to work, that salary is taxable.
• Retirement and pension payments. Retirement or pension benefits based on your age, years of service or contributions are taxable, even if you retired because of the injury.
• Social Security Disability offset. If you also receive SSDI, federal law generally limits your combined SSDI and workers' comp to 80% of your average current earnings before you became disabled, and the SSA prorates lump-sum settlements into a monthly amount for that offset. The offset amount then appears on your Form SSA-1099 as part of your Social Security benefits, which can be taxable depending on your income. How a settlement is worded can change the prorated amount, which is one reason people receiving SSDI often have their settlement language reviewed.

If you have a mix of income sources, confirm the tax treatment with a tax professional.

When to get a workers' comp lawyer

You can settle a straightforward, scheduled injury on your own, but a lawyer tends to pay for themselves when:

• You disagree with your rating or the insurer's doctor gave a much lower number.
• Your injury is unscheduled (back, neck, shoulder, head) and valued on earning capacity or a whole-body rating.
• You are being asked to close future medical care, especially if surgery is possible.
• You receive or may receive SSDI or Medicare.
• You cannot go back to your old job, which raises the value of the wage-loss part of the claim.
• The insurer has denied part of the claim or stopped benefits.

Workers' comp lawyers generally work on contingency, with fees capped by state law and usually approved by the judge, so there is often no upfront cost. For a broader look at how legal fees are structured, see our guide to how much a lawyer costs.

If your injury was caused by someone other than your employer (a negligent driver, or a defective machine made by a third party), you may also have a separate personal injury claim that is not limited by the comp schedule. Our personal injury settlement calculator shows how those claims are valued differently.

How to estimate your own PPD settlement

1. Find your date of injury and state. Rates and schedules are tied to the date you were hurt, not the date you settle.
2. Confirm your AWW from your wage records, then compute two-thirds of it and compare it with your state's maximum (and, in California, the PD cap).
3. Get your impairment rating in writing, including the body part, the rating guide and edition used, and whether it is a whole-body or extremity rating.
4. Look up the weeks in your state's schedule or points table.
5. Multiply rating × weeks × weekly rate, or plug the numbers into our workers' comp settlement calculator.
6. Add a realistic estimate of future medical costs if you are being asked to close them.
7. Check your numbers against your paperwork. If the insurer's offer is far below your estimate, ask how they got there: different AWW, a different rating, or a different weekly rate.

If you want help reading your rating report, working out which statute applies in your state, or understanding a settlement document, an AI legal assistant for individuals can explain the provisions in plain English and point you to the underlying law. For a claim with real money or future medical care at stake, use those answers to prepare better questions for a licensed workers' compensation attorney, not to replace one.

This article is general information about how PPD benefits are commonly calculated in several U.S. states as of 2026. It is not legal advice. Workers' compensation rules change regularly and depend on your state, your date of injury, and your facts.

---

Frequently Asked Questions

How are PPD settlements calculated?

In most states the permanent partial disability award is the impairment rating multiplied by a number of weeks and by your weekly compensation rate. The weeks come from your state's schedule for the injured body part or from a points table, and the weekly rate is usually two-thirds of your average weekly wage up to a state maximum. A negotiated settlement then adjusts that figure for future medical care, disputed ratings and any remaining wage-loss exposure.

How much is a 15% permanent partial disability settlement worth?

It depends heavily on the state, the body part and your wages. For a worker earning $900 a week, a 15% arm rating is worth roughly $21,600 in North Carolina and $20,250 in Georgia, while a 15% rating pays roughly $28,350 in Texas, $15,750 in Florida and about $14,645 in California using 2026 rules. Future medical buyouts and disputes can move a settlement well above or below the scheduled amount.

What does MMI mean in a workers' comp settlement?

Maximum medical improvement is the point where your doctor decides your condition has stabilized and is not expected to improve meaningfully with more treatment. It usually ends temporary disability benefits, triggers your permanent impairment rating, and starts permanent partial disability payments. It does not mean you are fully healed, and you may still need future medical care.

Who decides my workers' comp disability rating?

Your treating or authorized doctor usually assigns the impairment rating using the rating guide your state requires, often an edition of the AMA Guides. Many states let you challenge it. North Carolina gives you one second-opinion rating at the employer's expense, and California lets you see a qualified medical evaluator if you disagree with your doctor.

What is a future medical buyout?

It is a lump-sum payment in exchange for closing the insurer's obligation to pay for future treatment of your work injury. After a full buyout you usually pay for later treatment yourself, so it should reflect a realistic estimate of the care you will need. If you are on Medicare or expect to be soon, Medicare's interests must also be considered, sometimes through a Medicare set-aside.

Is a workers' comp PPD settlement taxable?

Generally no. IRS Publication 525 says workers' compensation for an occupational sickness or injury is not included in income. Exceptions include salary your employer pays after you return to light duty and retirement or pension payments based on age, service or contributions, and if your Social Security Disability benefits are reduced by workers' comp, the offset amount is reported as Social Security benefits that can be taxable.

Should I take a lump sum or structured payments?

A lump sum gives you control and closes the claim, while payments over time provide steady income and are less likely to run out. The right choice depends on your health, your other income, whether you are giving up future medical rights, and how the payment interacts with Social Security Disability. Many people have a lawyer review the terms before choosing.

Do I need a lawyer to settle a PPD claim?

Not always, but a lawyer is often worth it if you dispute your rating, have a back, neck or other unscheduled injury, are being asked to close future medical care, receive or expect Social Security Disability or Medicare, or cannot return to your old job. Workers' comp lawyers usually work on contingency with fees capped by state law.

Can AI help me understand my workers' comp settlement?

Yes, as a starting point. A tool like LegesGPT can explain your state's PPD rules in plain English with citations to the statute or agency rule, and review a settlement agreement to flag what you are giving up. It does not replace a licensed workers' compensation attorney when real money or future medical care is at stake.