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New workers' compensation cards to reduce fees

A significant number of Philadelphia residents who receive workers' compensation benefits due to a work injury or illness do not get a traditional check in the mail, but instead use a debit card issued by the state. The program, in which funds are electronically deposited so that recipients can spend them using a debit card, is becoming popular in Pennsylvania. It is estimated that around 40 percent of residents who receive workers' compensation or unemployment benefits use one of the debit cards.

But the program is not without flaws. Among the problems many workers' compensation recipients have dealt with is excessive fees at the ATM. The state treasurer said that one common -- and often criticized -- fee is one that crops up when the user transfers the money to a personal bank account. Since the money belongs to the user, and since many recipients are having trouble making ends meet after their work injury, this struck state officials as unfair.

That is why the state is issuing new debit cards. The new cards are issued in partnership with JP Morgan Chase. The number of in-network ATMs will increase by 25 percent, giving users more options to avoid paying a fee. As of March 15, the old debit cards will stop working, so people using the card option to receive workers' compensation should have their new cards by then. The cards are expected to eliminate about $5 million in fees charged to users, a significant amount given the approximately 150,000 people currently on the program.

Source: KYW-TV, "Pa. Jobless, Workers' Compensation Recipients To Save Money With New Debit Cards," Tony Romeo, Jan. 25, 2013

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