After your work injury, the insurance carrier for your employer will either accept or deny your claim for Workers’ Compensation benefits. Whether the claim is accepted or denied, the insurance company, or you the injured worker, may wish to settle the claim on a full and final basis. Settling a claim on a full and final basis means the insurance carrier will pay you a lump sum of money (a settlement) and they will be released from all liability on your claim. Any settlement is initiated by a settlement demand. A settlement demand is the amount of money you ask the insurance company to pay to settle your claim, not the final amount you are willing to accept to settle your case.
How do you determine whether or not it is a good time to settle your workers’ compensation claim? This question is best answered if we consider whether your claim was initially accepted or denied by the insurance company.
When your claim is accepted by the insurance carrier, they become responsible for all medical treatment related to the accident for the remainder of your life. In the standard course of most cases, you will treat with your doctor until you reach maximum medical improvement (MMI). Reaching MMI means that your condition will not likely improve with further treatment from your doctor. Typically, once you reach MMI, your doctor will either release you to return to your pre-injury job or place you under permanent work restrictions. While active treatment may no longer be necessary, maintenance treatment or pain management may be necessary. Additionally, you may require a surgery down the road or removal of hardware that is anticipated, but not yet necessary.
Typically, it is an appropriate time to settle after you reach MMI. However, in certain circumstances it may be advantageous to settle your claim before you reach MMI. Deciding when a claim is ripe for settlement should be determined on a case-by-case basis after careful consideration of all the factors involved in settling a workers’ compensation claim.
When you are settling your case, it is of the utmost importance that you include all potential future medical care and wage loss benefits (discussed on this page) in your settlement demand. An experienced workers’ compensation attorney can assist in helping you determine what your future medical treatment will entail and the insurance company’s liability for this treatment.
When your claim is denied, it is typical that the insurance company has not paid for any of your medical care or wage loss. While you may have health insurance that can cover your necessary treatment, the cost of that treatment to the workers’ compensation insurance carrier should still be included in your workers’ compensation settlement demand.
Determining when to settle a denied case is based on multiple factors. One of the most important factors to consider is the defenses asserted by the insurance carrier, and how likely it is that their defenses will succeed at trial. It may be in your best interests to settle before going to a hearing before the Virginia Workers’ Compensation Commission if the defense is strong. If their defenses are weak, it may be best to wait until after trail, or depending on some of the other factors discussed on this page, it may still be best to settle before going to trial. Deciding when a claim is appropriate for settlement should be determined on a case-by-case basis after careful consideration of all the factors involved in settling a workers’ compensation claim.
In denied cases it is of the utmost importance that you have an experienced Virginia workers’ compensation lawyer working on your side. A workers’ compensation attorney can determine the value of your past medical treatment, assist in determining the future medical care you will require, and the value of your future medical care and wage loss benefits which are discussed below. Your attorney should also be able to help you find alternative ways for you to receive medical treatment despite the denial of your claim by the workers’ compensation insurance carrier.
Whether or not your case was accepted or denied by the insurance company, your settlement demand should include past and future wage loss payments you may be entitled to. In most cases, you could be entitled to up to 500 weeks of wage loss benefits if your doctor keeps you totally out of work or you have permanent work restrictions that prevent you from returning to your pre-injury employment.
When you are totally out of work, the insurance company would be obligated to pay you temporary total disability (TTD) payments. The insurance company may also be required to pay you TTD benefits if you have permanent light duty restrictions and your employer did not have work for you within your restrictions.
If you are either temporarily on light duty work with your employer or have gone back to work with permanent work restrictions earning less than your pre-injury employment, the insurance carrier would be required to pay you temporary partial disability (TPD) which is 2/3 the difference of what you made before your work accident and what you make while working light duty.
If you have permanent work restrictions, you may also have been given a permanent impairment rating from your doctor. This permanent impairment rating is known as Permanent Partial Disability (PPD). This rating assigns a percentage loss of use to your injured body part(s), from 1-100%. Loss of use of several body parts, including arms (down to fingers), legs (down to the toes), amputations, vision, hearing loss, permanent scarring and disfigurement, and several other diseases, may entitle you to PPD benefits. Each body part identified by the Code of Virginia is assigned a certain number of weeks for total loss of that body part. If your loss is not total (i.e., an amputation) you would receive the percentage of the total weeks that body part is worth. The weeks of wage loss you are entitled to for PPD are deducted from your 500 weeks of wage loss benefits.
In rare cases you may suffer a permanent total loss of your ability to return to work, which would entitle you to lifetime payments for wage loss. These cases are rare and typically include traumatic brain injury or loss of use to two or more body parts. These cases usually do not settle until close to the end of your 500 week wage loss period, unless unusual circumstances present themselves.
Calculating the value of incurred wage loss, future wage loss and PPD is very complicated and it is best to have an experienced Virginia workers’ compensation attorney assist you in determining the value of your wage loss benefits in a settlement.
In all cases there are certain factors outside of the future care you require that necessitate consideration. An important factor to consider is whether you have health coverage outside of workers’ compensation, which may include private health insurance, TRICARE and Medicaid or Medicare.
If the insurance company hires a vocational counselor in your case, this is an extremely important factor to consider because it places your ongoing wage loss payments at risk of being terminated or reduced. When a vocational counselor is placed on your case it is critical that you contact an experienced Virginia workers’ compensation attorney to assist you with your case in order to protect your wage loss benefits.
Also, Long-Term Disability (LTD) or Short-Term Disability (STD) Plans may offer ongoing payments after you settle your workers’ compensation claim. Certain factors may apply to your entitlement to ongoing disability benefits and the amount you receive. The terms of your individual plan will dictate your entitlement, the amount and term of future payments.
In all cases where a workers compensation settlement is reached by the parties, the Virginia Workers’ Compensation Commission must approve the settlement. All settlements are submitted to a Deputy Commissioner (a trial judge in the Virginia Workers’ Compensation Commission) to determine if the settlement is in your best interest. The Deputy Commissioner reviews the medical reports filed with the Commission and defenses asserted by the insurance company to determine if the settlement is good for you. If the Deputy Commissioner determines the settlement is in your best interest, the settlement will be approved. Our attorneys have never had a Deputy Commissioner determine that a settlement was not in our client’s best interest.
After the Deputy Commissioner approves the settlement, which typically takes two weeks after the settlement documents are submitted to the Virginia Workers’ Compensation Commission, the insurance company has 44 days to put your settlement check in the mail. If the insurance company fails to mail your check within 44 days they may be required to pay you a penalty, which is the equivalent of the fees paid to your attorney for helping you obtain your settlement.
Attorney’s Fees in a Virginia workers’ compensation claim are determined by Commission rules. The Virginia Workers’ Compensation Commission allows an attorney’s fee of 20% of the total settlement. There may also be attorney’s fees that were not paid earlier in the case (in the event an Award was previously entered) that may be added to the 20% settlement fee. All attorney’s fees in a settlement are deducted from your settlement and paid directly to your lawyer by the insurance carrier.
Also, any costs incurred by your attorney (i.e., payments made by your lawyer for getting medical records, hiring experts, court reporters or fees paid to consult with your treating doctor, etc…) will be deducted from your settlement and paid directly to your attorney.
When you settle your workers’ compensation claim, there may be liens against your settlement. Most often these liens relate to whether or not a third party is responsible for your injuries (i.e., you were injured in a car accident while working). In these cases, the workers’ compensation insurance carrier will have a lien against the amounts they paid that a third-party is responsible for (i.e., the driver who caused your accident). The Virginia workers’ compensation insurance carrier is entitled to repayment less their fair share of attorney’s fees you paid to get your payment from the at-fault party. An experienced Virginia workers’ compensation lawyer will be able to have the insurance company’s lien either reduced, totally waived or have you receive an additional settlement amount from the workers’ compensation insurance carrier to avoid future liability.
During the course of a case you may have incurred medical care you could not afford to pay for at the time, and your doctor agreed to be paid at the conclusion of your case. Depending on the agreement you, or your attorney, reached with the doctor, his fees may also be deducted from your total settlement amount.
If you are a Medicare recipient, or may be entitled to Medicare within 30 months of settlement, special considerations must be taken for Medicare’s interest in future medical payments related to your work injury. Your workers’ compensation attorney can advise you on any issues related to Medicare and your Virginia workers’ compensation settlement.
In settling your Virginia workers’ compensation claim there are many complex factors to consider. Oversight of any of these factors could result in you not getting the compensation you deserve for your injuries. Based on the complex nature of workers’ compensation settlements it is extremely important that you consult with a knowledgeable Virginia workers’ compensation attorney to ensure that you receive the settlement you are entitled to.