If you are reading this, we are at the end of your workers’ compensation claim. At this stage, there are several options and you have to make several decisions.
I created this post so you can review your options and understand the basics before we discuss exactly how this would work in your case. This is a long post, because there is a lot to consider.
These options can be complicated, so take some time to read this over (twice, at least) and really think about it. You must know what your options are before you can settle your claim.
After you review this post, we need to discuss it. Please call me to discuss the matter when you are ready for it. I will also call you but often it is better if you are ready for the 10-20 minute chat this requires.
This is a serious decision. You are the only person who can decide the “best” option to choose. I will be happy to tell you what I think, but ultimately it is your life and you will have to live with the results.
Make sure you understand this information before you agree to settle. I will go over it with you and make sure you understand it, but I cannot make the decision for you.
You have four main options in resolving your workers’ comp case:
Option A – Permanent Partial Disability Benefits
The first option is not to settle your claim at all. You will still get all of the benefits mandated by law (permanent partial disability benefits, explained in more detail in this post), and you do not give up any future rights you may have under the law.
This is the “default” option and we will proceed in this manner unless we choose to pursue another option.
If you choose this first option, we will have a hearing before a Commissioner of the Workers’ Compensation Commission, and we will let the Commissioner decide what your permanent partial disability (PPD) rating should be.
At a hearing, we can present your medical records and you can testify about your ongoing pain and the problems related to your on the job injury. See a detailed explanation about how those hearings go here.
The Commissioner will look at the evidence presented, and will make a decision after the hearing. You will receive an Order (in the mail) with the Commissioner’s judgment on the rating of your permanent disability (it will say something like “15% permanent partial disability” to the affected body part).
To understand what that Order actually means in terms of payments, read our post on PPD benefits here and see the section titled “How the Payments Work.”
If you choose this first option, you will retain all of your future rights under the law. Those rights include (a) lifetime medical benefits for all problems causally related to your on the job injury, and (b) the right to reopen your case for more monetary benefits if your condition worsens (but you have to reopen your case within 5 years of the date you last receive a check from the Insurer). If you reopen your case, you can receive more temporary disability benefits if your doctor keeps you off work, more voc rehab, and more permanent disability benefits if your permanent condition worsens.
Option B – Full & Final Settlement
The second option is a full and final settlement. This means you will close your case and never look to the insurance company for more benefits. You will trade away your right to future medical benefits and your right to reopen your case. If you fully and finally settle your case, any future medical care related to your work accident will be your responsibility.
In exchange for your agreement to give up your rights, the insurance company will usually pay you more money than you would otherwise receive if we went to the hearing.
How much more money you will receive depends on the nature of your injury and other variables. It is different in each case. We can discuss the amounts I think are reasonable when we talk
If you settle your case with a full & final agreement, your benefits will be paid in a lump sum. That is potentially a large benefit of settlement. Lump sum money is always more useful than weekly payments into the future. The law usually calls for weekly payments. That is the default option explained above. I hate that, but I am not a member of the legislature and cannot do anything about that.
Option C – Settlement with Open Medicals
Technically, you can make other terms when you settle, like leaving your medical rights open. You can settle on the issue of how much money you would receive, but leave open your medical rights. You would give up all the future rights I mentioned above with the exception of your right to medical care.
However, the insurer does not usually want to do this. They will in special cases, but they like to avoid it. When they settle, they want to get rid of your case forever. That is how insurance companies like to work for reasons that have to do with their stock price, portfolio of assets, and risk management. It is not based on the facts of your case and certainly not on what is in your best interests!
If this is a valid option in your case, we will discuss it, but it is not usually a valid option in most cases. The insurer either wants you to trade away your medical rights or go to a hearing.
Option D – Stipulation
We can also agree to the amount of disability the Workers’ Compensation Commission will give you. With this option, you continue to keep open all of your medical rights and your other rights.
The only real difference between this option and option A is that we don’t need a hearing. We agree in writing that your permanent partial disability rating should be X%. The Commission will usually agree with us and pass an Order confirming our resolution. Everything else is the same.
The problem is that insurers don’t usually agree to stipulate. They would rather make it a fight at a hearing. If they do agree to stipulate in your case, we will discuss it.
Options E, F, G, etc. . . .
Technically, we can put anything we want in a settlement agreement, but unusual terms are not common. I mention it here in case you think there is something we should discuss.
Should you settle?
- How likely is it that you need future medical care for problems related to this accident? What does your doctor say? I read your medical records but you are the only one who actually talks to the doctor and gets the detailed answer to this question.
- Do you have health insurance? Is it stable?
- Will your insurer or the government cover you in the future if you need care? I have no idea. You have to consider the state of our country. The health care laws are in a state of flux right now and I cannot predict what the law will be in the future. The next President or Congress may just change them all. This is a risk you have to take into consideration.
- What will you do with the money you get in a settlement? If you use the money for a definite purpose to make your life easier or advance your ability to work and earn a living (like taking college courses, or getting a license or a certificate you need), then this may be a good risk. It is more of an investment in your future. If you just plan to spend the money on normal expenses, it may not be such a good idea.
Only you can analyze your own situation, and answer these questions. You should talk about it with your doctor if you have questions about your need for future medical care. I am not a doctor and cannot predict your need for future care. You must speak to a medical expert about it.
Realize that you are always taking a risk by settling your case. You do not have to settle your case, and if you do need future medical care for this injury settlement may be a bad idea.
Medicare Set Asides
This is a very complex part of settlements that may come into play in some cases. If this is your case, I will tell you and you need to read this section. Otherwise, you can ignore it.
Under federal regulations that were enacted in 2010, if we do a full & final settlement, we must consider the rights of Medicare in doing so. In the past, some people would settle their workers’ comp case, go on social security disability, and just get all their medical care paid for by Medicare.
Medicare wants to make sure that the taxpayers of the future never end up paying for medical care that should be the responsibility of an insurance company.
This is a noble goal, but the way they did it is convoluted, confusing, and certain to fail (in my opinion). They have made it harder to settle your claim. Sorry. I didn’t do it. Congress did it. It makes my life harder too.
If you will need any future medical care for your injury, we must set aside some money now to pay for it. We are allowed to settle your case only if you promise to take some of the money (we will specify how much in writing) and set it aside in a special bank account so that you can pay for your future medical care out of that account.
YOU will hold the account and administer it. You will use it to pay for any future medical care that is causally related to the work injury. If you run out of money in that account and need care from Medicare, Medicare may tell you that they will NOT cover your care. If you are also uninsured, or the laws allow an insurer to deny you for a pre-existing disability, then you may have no coverage for necessary medical care.
If a Medicare Set Aside has been or will be proposed, I will send you a copy of it. Read it over carefully and make sure the facts are correct, and you are comfortable with the amounts they want to pay you for the Medicare Set Aside.
Unfortunately, you really need an expert opinion on whether this Set Aside is right or not. You should take it to your treating doctor and discuss it with him or her. I cannot possibly judge whether or not you need future medical care, and if you do, what you will need and how much it will cost. You need to get an expert opinion on this matter. That is your doctor.
For instance, if they are projecting future medical costs, will they be right? Who knows! Usually, they project costs using the fees the insurer would pay. You won’t get those good rates. You will be paying out of pocket. Will their anticipated amounts cover it? I don’t know. I cannot pretend to know. You are the only one who can analyze this, and you should do so with your doctor.
Social Security Disability
If you have applied for, or plan on applying for, Social Security Disability (not regular Social Security – just SSDI), you must call me to discuss that immediately. Social Security will get the benefit of any offset if they think your settlement should cause a reduction in your disability benefits. They will reduce or suspend your Social Security benefits if you do not do it right.
Be sure to let me know if you have any involvement at all with Social Security Disability.
If all this sounds complicated – you are right! It is! The safe way is NOT to settle your case if you think there will be any need for future medical care. If you do settle, you are taking a risk regarding any future medical treatment for this injury. If your settlement includes a Medicare Set Aside, you are taking a risk that the money in the Medicare Set Aside is enough to cover it.
Of course, the insurer offers you more money in your pocket to get you to settle. Is it worth it? Maybe it is, and maybe it isn’t. We will discuss the unique facts of your case in detail so you know the risks.
Again, read this over a second time. Get a spouse, friend or family member to read it over and give their opinion. You and I will discuss it in detail with regards to your particular case.
If you have any questions at all, feel free to call me.