“Scars have the strange power to remind us that our past is real,” Cormac McCarthy. While this was too poetic, a workers’ compensation case is not. If you are not familiar with this term, it is a form of insurance providing wage replacement and medical benefits to employees, who were injured in the course of employment, in exchange for mandatory relinquishment of the employee’s right to sue their employer for the tort of negligence. Pretty complicated it might sound. Basically, workers’ compensation is insurance. It provides cash benefits and/or medical care for workers who are hurt or become ill as a direct result of their job. If you are currently undergoing a similar problem, there are details you should be aware of.
Workers’ compensation law
So who pays for this insurance? Employers do. It is all on them. The employer’s insurance carrier pays weekly cash benefits and medical care. This is forced on and directed by the Workers’ Compensation Board, which is a state agency that processes the claims. If any problems arise the Board will interfere and will determine whether that insurer will reimburse for cash benefits and/or medical care. Furthermore, the Board will decide amounts payable as well.
One would think that, as in all aspects of life, there should be decided a party that is at fault. But in workers’ compensation case this is not the case. The amount of reimbursement that the employee will receive is not decreased by his/her carelessness, nor increased by an employer’s fault. But don’t get too excited and think of illegal ways of getting workers’ compensation. If the injury results primarily from the employee’s intoxication from drug or alcohol abuse, or from the intent to injure him/herself or someone else, the employee will lose the right to workers’ compensation.
If the insurance carrier agrees to the idea that the injury is caused by work a claim will be paid. But if the employer or the insurance carrier argues the claim no cash benefits will be paid at the time. Afterward, the judge will decide who is right and who is wrong. Meantime, as the dispute continues and the worker is not receiving benefits, he/she will be eligible for disability benefits. However, the payments made under the Disability Program will be taken out from the future workers’ compensation case awards.
Settling workers’ compensation case
Now that you know how the legal system regarding workers’ compensation case works, let’s understand what it means to “settle” the case. Settlement: a private agreement between two parties in a legal action where one party agrees to end the legal proceedings in the exchange for something. And we all know what that “something” usually is: money. Are you familiar with the “section 32 agreement?” In the workers’ compensation context it means to settle. The hurt employee decides to close the case, freeing the carrier from their responsibility to pay on-going weekly benefits and medical care. All of this is done in exchange for a lump sum of money.
The key is for the employee to understand what kind of medical treatment they will need going forward with their life. Because the just mentioned lump sum of money represents the value of the on-going benefit and the cost of on-going medical treatment. The tricky part is, that as soon as the worker closes his/her workers’ compensation case, it can never be opened again. And if the person needs, for example, a sugary in the future, the cost is all on him. First of all, the settlement needs to receive Department of Labor approval. The main concern of the Department of Labor is ensuring that employees settling their cases understand everything: the rights they are giving up and the rights they are retaining.
Under the law of workers’ compensation employers have responsibilities. Before an injury or illness is present, the employer should obtain workers’ compensation insurance or qualify to become self-insured. After the injury is present, the employer should provide compensation claim form to the worker within one working day. Next, he/she should return a completed copy of the claim form to you within one working day of receipt. One should not forget about the claims administrator: the employer should forward the claim form, together with the employer’s report of occupational injury within one working day. After, within one day of receiving your claim, authorize up to $10,000 in medical treatment. And in the end, the employer should provide transitional work, usually light duty, to the worker whenever appropriate.
Making a decision about settling your workers’ compensation case is not an easy thing to do. There are a lot of different factors that you need to take account in your decision-making process. No two legal case are ever the same. It is important to go over all your options and only then make a decision. First, think about what type of settlement in your workers’ compensation claim you want: a to-date settlement or a full, final and complete settlement.
A to-date settlement
You are only settling “to the date of” the award on the settlement in the case of to-date settlement. It means that you have the right to bring future claims. Of course, if those are not limited by the terms of the settlement. If you have a claim that was picked up by the worker’s compensation insurer, but they didn’t pay a few bills or you have a limited claim, then this type may be appropriate for you.
A full, final and complete settlement
If a to-date settlement is not what you need, you should think about a full, final and complete settlement. This works for claims that were denied. This settlement may be appropriate for you if you have a more involved claim with several disputed issues or you cannot return to work for the date-of-injury employer again.
Pros of accepting a settlement
One of the advantages of a settlement is that it guarantees you benefits without the risk of a trial. However, in some states, you can’t receive a lump sum payment after you win at trial. And what will happen? You’ll receive weekly payments for a number of weeks or years. Another benefit of accepting a settlement is that it is so much easy. First of all, it saves you the time. You don’t have to go through the hearing. Settling the case will keep you away from the hassle and the anxiety.
A third advantage is actually a tricky one. For example, your doctor says states that there is a 15% chance that you will need hand surgery in the future. So you can demand that the insurance company pay you part of the cost of the surgery now. As the likelihood that you won’t need the surgery is high you just get extra money. So you can receive money from the insurance company in exchange for giving up rights to future benefits that you may never use.
Cons of accepting a settlement
As mentioned above, you may receive money from the insurance company and give up your right to future medical treatment for your injury. If you don’t play this right, you might end up being in need of medical care. And have trouble getting your health plan to cover it. And of course, there is always the chance that you might spend the settlement money right away. It leaves the worker with no weekly payments and with the possibility of lower salary in his/her future job.
The interesting part
The amount of workers’ compensation settlement is always what interests people most. The benefits have nothing to do with pain and suffering. Calculating the value of the settlement depends on two things. First, the amount of workers’ compensation benefits that one might be entitled to in the future. And second, the likelihood of receiving those benefits.
The best way to answer the question, “when should I settle my workers’ compensation case?” is the following. Until you have reached “maximum medical improvement” (MMI). When your doctor tells you that you are as good as you are going to get, maybe it is time to settle. And the reason why you should wait so long? Because you won’t be able to accurately estimate the value of your case until you know the full impact of your injuries.
Making a decision on your own is probably not a great idea. Attorneys give the best legal help. And if you don’t have one yet, make a decision on consulting with one before agreeing to settle your workers’ comp case. A lawyer will be able to evaluate the settlement offer accordingly. If you are in California read more about CA workers’ compensation law.