Probable earnings at age 18 are used to determine which factor?

• A. Determining PD
• B. Calculating medical benefits
• C. Setting wage replacement
• D. Auditing claims

Answer: (A)

Probable earnings at age 18 are used to gauge how much earning capacity a person loses for the long term, which is the heart of determining permanent disability. In California workers’ compensation, the permanent disability rating isn’t based only on the impairment percentage; it’s adjusted for the worker’s age and potential future earnings. Using an 18-year-old baseline provides a standard reference for the long-term earning impact, so the same impairment yields a higher disability rating for someone with many earning years ahead and a lower rating for someone closer to retirement. This reflects the concept of lost future earning capacity.

Medical benefits are determined by medical necessity and treatment needs, wage replacement is tied to current or pre-injury wages, and auditing claims is administrative. None of those rely on probable earnings at age 18 the way permanent disability does.