Long Beach Lawyers Explain:
Workers’ Compensation Future Medical Care “Buyouts” –
A workers compensation “buyout” occurs when the workers’ compensation insurance company wants to offer you a settlement of your case for a “lump sum” of money – rather than paying for your “future medical care.”
And while taking a large “lump sum” may seem quite attractive now – there are a number of important factors to consider with your workers compensation lawyer before you agree to a lump sum “buyout”.
A “buyout” settlement is most often paid in one lump sum – but it can also be offered as a combination of a partial lump sum and a set amount of life time payments.
Remember that the insurance company is never required to offer a “buyout”. And you are never required to accept a buyout! A buyout is a settlement reached by the agreement of both parties – usually through the help and negotiation of their lawyers.
Why do Workers Compensation Insurers Offer Lump Sum Buyouts?
If you have been issued an Award entitling you to benefits that include, but are not limited to, permanent disability and future medical care for your work injuries, the insurance company must continue to pay for your medical care as long as you need it. This could amount to tens of thousands – or even hundreds of thousands – of dollars in medical payments over time!
The insurance carrier might be seeking to “buyout” these payments for a “lump sum” so that they have a fixed (not indefinite) amount of money to pay out. If they can “close out” your claim entirely by paying a single lump sum, it is also “off their books” and they are done with it.
Considerations of Workers Compensation Buy Outs
The biggest potential problems of accepting a workers compensation buyout is that once you settle for a lump sum, you can no longer receive medical treatment for your work injuries through the Workers’ Compensation system. Should you need medical treatment in the future, you will have to find a way to pay for it, either through new insurance or (in many cases) out-of-pocket.
However, to some injured workers, no longer being tied to the Workers’ Compensation system for medical treatment may be seen as a benefit. As long as the lump sum is indeed large enough to cover all of the future medical treatments, a person may prefer to pay for and control their own medical treatment by taking a “lump sum” and opting out of the workers comp system.
How Much Can I Get in Workers Compensation Buyout?
Determining the “lump sum” value of your workers compensation case is not an easy task. And, in many cases, the insurance carrier may misguide an injured worker, as to what is a fair value for closing out their case. Obviously, the workers’ compensation insurer wants to pay out as little as possible.
For this reason it is important to discuss your lump sum buyout with an experienced workers’ compensation lawyer. An experienced workers’ compensation lawyer can help you understand and assess all of the benefits you are entitled to – so that you can maximize the value of the claim.
Every buy out must be viewed differently, and there are many factors to consider in deciding if a buyout offer is “big enough” and in your best interest. Evaluating how much medical treatment the worker will need in the future is the first step. This includes looking at the medical treatment recommendations made by the treating and/or evaluating physicians.
If the future medical care includes invasive medical treatments, surgery, diagnostic studies, home healthcare, ongoing physical therapy, etc. the higher the value of the case – and the bigger the lump sum that should be offered.
Other matters to consider in accepting a lump sum workers compensation buy out are:
- The permanent disability indemnity, and whether a balance remains to be paid.
- If the injured worker was awarded a life pension
- If the injured worker is entitled to a subsequent job displacement voucher
- If the claim can be re-opened pursuant to the “five-year-rule”
- Any offsets with other disability benefits, such as pension or retirement benefits
These are some of the important questions that need to be addressed prior to settling the claim. The insurance carrier will not provide this information in hopes of getting the injured worker to agree to settle for a lower amount.
Additionally, an injured worker needs to understand the effects that the lump sum settlement will have on their current (or future) Medicare and/or Social Security benefits. In many situations, a Medicare Set-Aside should be put in place to protect future benefits. Read more about Medicare Set Asides.
Long Beach Workers Compensation Lawyers
Our experienced Long Beach Workers Compensation lawyers have helped thousands of men and women across Orange County and Los Angeles collect the workers compensation they deserve. If you have been offered a lump sum buyout by your workers’ comp insurer, our lawyers will be happy to help you understand your options, to ensure you receive the full amount of benefits to which you are entitled.
Call our Long Beach Workers Compensation lawyers today for a free consultation.
Long Beach Workers Compensation Lawyers: 562-622-4800