Settling a workers' compensation case involves an agreement between the injured worker and the employer or insurance carrier. This settlement can be in the form of a lump sum or an annuity that covers lost wages, future earnings, and medical expenses for the remainder of the worker’s life.
Understanding Workers' Compensation Settlement
A workers' compensation settlement is a significant decision. Consider the trade-offs carefully, including any intangible benefits you might be receiving, such as no longer needing prior approval for medical treatments. Post-settlement, decisions about medical treatments can be made without prior approval.
Managing Your Settlement Funds
In cases involving a Medicare Set Aside, there are specific CMS guidelines for managing your medical funds. Understanding these rules is important to properly handle your settlement. Upon settlement, you will manage your own indemnity payments, as regular checks from an employer or insurance will stop.
Full and Final Settlement
Most states allow for a full and final settlement, meaning the employer pays a lump sum or structured settlement. After settlement, ongoing medical costs should be paid from your medical fund, as the employer or carrier won't cover these expenses.
Calculating Settlement Value
Settlement value calculations include past and future indemnity benefits and future medical expenses. This calculation might involve factors such as life expectancy, state-specific COLAs, and anticipated medical needs. Sometimes, expert medical personnel are involved to estimate future medical costs.
The Settlement Approval Process
Once the parties agree on a settlement, it must be reviewed by the state Workers’ Compensation agency. Approval involves filing documents and possibly attending a hearing before an Administrative Law Judge or Commissioner who ensures the settlement serves the best interest of the injured worker.
Following Guidelines and Securing Approval
For those settlements involving a Medicare Set Aside, it is crucial to follow CMS guidelines. Detailed information on these guidelines can be found in the [CMS reference guide](https://www.cms.gov). Once a settlement agreement is prepared, obtain necessary approvals to ensure it aligns with legal requirements and serves the injured worker’s best interest.
