Workplace injuries don't always end up being permanent, but it does happen sometimes. When you have been ruled by the workers' compensation insurance company and your doctors to be permanently disabled, you will likely be entitled to a lump sum payment from the insurance company. The amount offered varies, and the total amount depends on several factors. Since the process for determining a permanent disability can be long, your eventual award might include items that must be deducted (or paid back) to various parties. To get an idea of what to expect in terms of deductions from your lump sum settlement, read below.
Disability Advance Payments
Not all workplace injury or illness victims receive advance payments. Depending on state regulations, hurt workers can sometimes be paid an advance financial support payment. This money is meant to span the time period between the permanent disability determination and receiving the settlement. In some cases, some or all of the advance payments will be deducted from your payment.
Medicare or Medicaid Benefits
In some cases, a hurt worker is eligible to receive benefits from Medicaid or Medicare. If your workers' compensation insurance didn't cover all of your medical expenses and you used either of those instead, they are considered secondary payers and must be paid back.
Taxes
The bulk of your workers' compensation settlement is provided to you tax-free. That is the case with all forms of workers' compensation—from your initial weekly disability payments to the settlement and including any structured payments. The only exception is interest income. In some cases, overdue workers' compensation benefits have interest added to them. Just the interest portion is taxable.
Unemployment Benefits
You may have had your initial claim for workers' compensation denied and was forced to file for unemployment benefits. If so, you may have to reimburse your state unemployment agency for any funds once your settlement is approved.
Medical Liens
Some medical facilities and doctors will agree to advance medical treatment to workplace injury victims when a claim is in dispute. When that happens, a medical lien gives them a legal right to claim some of your settlement.
Child Support
When you are unable to pay your child support obligation due to being out of work, some child support enforcement agencies can take a certain portion of your settlement. The limit varies by state.
Attorney and Legal Fees
Finally, the help you received from your workers' compensation attorney may be based on a contingency fee. The percentage due to the attorney depends on your agreement and the money is automatically deducted before it is provided to you. The amount averages about 15% of your total settlement and these fees are negotiable.
Knowing that the amount you agree upon may be reduced should help you understand how much your final settlement should be. Speak to attorneys like those at Prediletto, Halpin, Scharnikow & Nelson, P.S. to learn more.
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