What is workers’ compensation?
Workers’ Compensation are state-run programs that go back to the early 1900s and the Grand Bargain between workers and management. Management provided a no-fault injury compensation system that paid medical bills and replaced lost wages. Injured workers gave up the right to sue in civil court.
Back in ye olden days, streamlined and well-funded workers’ compensation systems expedited these benefits to injured workers, so they could get back on the job quickly. Today, the workers’ compensation process is very complex, and constant rate reductions have left most systems underfunded.
Signs You Should Hire a Lawyer for a Work Injury
Insurance company lawyers usually cannot dispute fault, since workers’ comp is no-fault insurance. In most cases, it doesn’t matter if the injury was partially, mostly, or entirely the victim’s fault, as long as the injury was work-related.
Insurance company lawyers can and do dispute the amount of damages. Inaccurate AWW (average weekly wage) calculation is a good illustration. The AWW is the basis for lost wage replacement. Insurance companies often only look at prior net income. However, the AWW also includes per diem and other non-cash compensation. It also includes future lost overtime opportunities and missed performance bonuses.
Note that workers’ compensation rules vary in different states. For example, some states allow injured victims to choose their own doctors, and some force them to see company doctors.
Nonsubscriber Claims
This phrase is Legalese for job injury claims that workers’ compensation does not cover, mostly because the employer was uninsured or reckless.
Almost all states have mandatory workers’ compensation laws. Some companies ignore these laws and don’t buy insurance. Others lie to insurance companies, usually about payroll size or the number of workers. Bitter experience has taught many of us what happens when you lie to an insurance company and file a claim.
By design, workers’ compensation only covers unintentional injuries. These plans don’t apply if the employer was reckless or the injury was intentional. Some employers recklessly send workers into hazardous areas, like un-lined construction pits. Others force employees to perform dangerous assignments as a form of punishment.
In many nonsubscriber claims, companies cannot use some “silver bullet” defenses, such as comparative fault or assumption of the risk. So, it’s easier for an attorney to prove negligence, or a lack of care, in these cases, and obtain compensation. In addition to medical bills, lost wages, and other economic losses, compensation in civil court usually also includes money for noneconomic losses, such as pain and suffering.
The Workers’ Comp Claims Process
Once upon a time, the claims process was so easy workers almost immediately received benefits. Now, the process is long and complex.
Most Claims Examiners either partially or entirely deny workers’ comp claims during initial reviews. Frequently, these examiners use technical flaws as an excuse to avoid addressing the merits of the claim. So, a denial doesn’t mean your claim isn’t worth pursuing.
To obtain full benefits, lawyers usually appeal these matters in a hearing before an Administrative Law Judge. An ALJ hearing isn’t just a paper review. Lawyers may make legal arguments, challenge evidence, introduce evidence, and otherwise do their jobs. As a result, the ALJ approval rate is even higher than the Claims Examiner denial rate.
Even a “minor” work injury could cost thousands of dollars in medical bills and lost earnings. Your employer, not your insurance company and certainly not your family, is financially responsible for these expenses
Lost wage benefits are available, but insurance companies don’t give them away like candy on Halloween. Instead, these claims must wind their way through the workers’ compensation process, or at least most of it.
An injury report begins this process. Most states impose strict deadlines on job injury victims. Typically, if a victim doesn’t file a claim in about ten days, the insurance company denies payment, no ifs, ands, or buts. Special rules apply in toxic exposure and other occupational disease claims.
A paper review, mostly based on the medical records, is next. Typically, regardless of the claim’s merit, a Claims Examiner almost always denies it.
Insurance adjusters have the advantage at the Claims Examiner phase. Job injury lawyers have the advantage at the next stage, which is a full hearing before an Administrative Law Judge. Because the environment changes, most insurance companies are motivated to make favorable deals. They’d rather pay most of the claim than go to trial and risk paying all of it.
What Does a Workers’ Comp Lawyer Do to Settle a Workers’ Compensation Case?
The settlement process in a workers’ compensation claim is like the settlement process in most other civil claims.
First, an attorney establishes a claim’s settlement value. This figure includes prior and future losses. Prior losses are usually straightforward, subject to the issues discussed above. Future losses are a different kettle of fish. Most job injuries never completely heal. Victims must still miss work and see doctors, even years later. If a settlement doesn’t account for these charges, victims are normally financially responsible for them.
Next, when negotiations begin, a good workers’ comp lawyer knows when to compromise and when to stand firm. The settlement value, like a new car’s sticker price, is a starting point for negotiations. There’s always some give and take. A well-prepared and highly experienced lawyer ensures that the insurance company does most of the giving.
When You Should Get a Lawyer for Workers Compensation
Job injury claims with no contested issues often settle quickly. In fact, they may settle within a few weeks after an injury. However, even though insurance companies cannot contest fault, they usually find something to disagree over. These disagreements, which always delay settlement, usually involve the amount of benefits.
In most states, workers’ compensation insurance companies must pay reasonably necessary medical bills. To most insurance adjusters, “reasonably necessary” means “cheapest possible.” Making matters even more complex, in many states, job injury victims must see company doctors. In the event of a billing dispute, you can probably guess whose side these doctors take.
Insurance companies could contest lost wage replacement as well. Typically, workers’ comp pays two-thirds of the victim’s AWW (average weekly wage) for the duration of a temporary disability.
As for the amount, the “average” doesn’t mean “past average.” Assume Bill gets hurt a week before his probationary period ends and his wage increases. If he misses ten weeks, nine of those weeks must reflect his newer, higher income. Additionally, Bill’s AWW must reflect things like future lost overtime opportunities.
The “duration” could be an issue as well. As mentioned, many job injury victims must see company doctors. These doctors often try to rush victims back to work before they’re ready. Usually, job injury victims are entitled to second opinions.
On a related note, workers’ compensation also covers occupational diseases, like hearing loss, that occur slowly over time. These claims have some additional issues, mostly because these victims don’t immediately report their injuries and a pre-existing condition is usually involved.
When Will Workers’ Comp Offer a Settlement?
Sooner or later, workers’ comp insurance companies usually make settlement offers. About 95 percent of civil claims settle before trial. Unfortunately, a reasonable settlement offer almost always comes “later” rather than “sooner.” Frequently, insurance company adjusters offer pennies on the dollar, often while a victim is in a hospital room.
Later, when the case goes to court and an Administrative Law Judge hearing date draws near, insurance companies get serious about settling cases. Especially if a lawyer is well-prepared and has a successful track record, they don’t want to risk a trial. Additionally, many insurance defense lawyers charge over $2,000 per hour. That expense adds up. If a case lasts six or eight months, many insurance companies are eager to make reasonable settlement offers and stop the bleeding.
How much is the average workers’ comp settlement?
The average workers’ comp settlement varies widely depending on the severity of the injury and other factors. Most insurance adjusters don’t use the facts of the case to determine damages. Instead, they use charts, which are something like infant growth charts.
At X age, babies should do Y (roll over, sleep through the night, etc.). Likewise, as far as adjusters are concerned, X injury or illness means Y days off work and Z amount of medical bills.
If Junior isn’t rolling over or solving basic equations at a certain age, some parents get nervous. Likewise, if Eric’s medical bills and/or lost wages are above the chart amounts, most insurance companies will not pay the excess amount.
Typically, insurance companies bully job injury victims into settling these claims on less-than-favorable terms. Job injury lawyers prevent that kind of bullying and give victims the best possible chance to avoid a claim denial.
How Much Do Workers’ Comp Lawyers Charge?
The cost of legal services can be a concern for clients. Typically, workers’ comp lawyers charge on a contingency fee basis, which means they receive a percentage of the settlement or award if the case is successful. In most states, the typical workers’ comp contingency fee is 25% of the final settlement amount. However, it’s important to note that some states have a cap on the amount a lawyer can charge. It’s best to discuss the specific fee arrangement with your lawyer to understand the costs involved in your case. Most lawyers offer a free initial consultation to discuss your case and determine if they are the right fit for you. In fact, you can book a free workers comp lawyer consultation through AskLegally.
When Does Workers’ Comp Pay Start?
Lost wage replacement benefits don’t begin on the first missed day. The average waiting period, which varies in different states, is about seven days. Waiting periods reduce employer costs. If injured workers go back to work before the waiting period expires, the resulting “medical only” claim is about 70 percent less than a full workers’ compensation plan.
The waiting period is partially or mostly retroactive in some states. For example, Texas has a seven-day waiting period. If victims miss at least fourteen days of work, the insurance company pays lost wage benefits for the initial seven-day period.
Here’s how this game works, especially in states that force injured workers to see company doctors. A worker files a claim and the company doctor quickly clears the victim medically. If the injury isn’t fully healed, the initial claims deadline has usually passed, so the victim cannot refile. Even if refiling is possible, most Claims Examiners quickly reject subsequent claims. They may even accuse these victims of fraud.
Temporary Disabilities
The waiting period rule works a bit differently if, as is often the case, doctors clear victims to go back to work part time. If that happens, workers’ compensation pays two-thirds of the difference between the pre-injury and post-return incomes.
Assume Jake, who is a warehouse worker, hurts his shoulder. He cannot lift, but according to his doctor, he can sit. So, Jake’s boss gives him parking lot attendant duty. Parking lot attendants earn a lot less than warehouse workers. This time, however, there is no waiting period. Jake’s new benefits begin immediately, at least in most states.
Permanent Disabilities
The waiting period rule usually doesn’t apply in permanent disability cases. Whether the disability is temporary or permanent, over the long haul, the victim will miss a lot more than seven days of work.
The eggshell skull rule, on the other hand, often applies in workers’ compensation disability cases. Many people have pre-existing or non-work conditions which increase the probability and/or severity of injury.
Assume Linda, who is a lifeguard supervisor, is pregnant. Part of her job includes working with toxic pool cleaners. Usually, chlorine and other fumes aren’t dangerous. However, to pregnant women, these fumes are often disabling. They’re even more dangerous to their unborn children. If Linda or her baby gets sick, the insurance company cannot use Linda’s pregnancy as an excuse to reduce or deny benefits.
On a related note, despite federal laws which prohibit the practice, pregnancy discrimination is very common.
Some companies flatly refuse to hire pregnant women. Others unilaterally reassign people like Linda to other, lower-paying positions to prevent toxic exposure and other conditions. This call might be the right call. However, the decision to transfer belongs to Linda and her family, not to Linda’s boss.
Pregnancy discrimination victims usually have legal options, sometimes under state, federal, and local law.
What Happens to Medical Bills When Workers’ Comp is Denied?
The average injury-related medical bill is over $50,000. Several times over the last ten years, the Supreme Court has diluted some important consumer protections in the Fair Debt Collection Practices Act.
As a result, medical collectors are more aggressive than ever. If workers’ comp claims are denied, the victims are financially responsible for these bills. So, winning a workers’ comp claim is absolutely critical.
Medical bills are just part of the puzzle. Job injury victims are also entitled to lost wage replacement. If they lose their claims, they lose these benefits as well. So, they’re not only stuck with large medical bills. They also have no way to pay them. Most injured workers who lose their claims end up filing bankruptcy.
So, in this post, we’ll look at some ways to win your workers’ comp claim and avoid this negative fallout.
Work-Related Injury
No-fault benefits are available if the injury or illness was work-related. That qualification sounds straightforward, but insurance companies almost always contest it.
Many people have pre-existing medical conditions that affect their claims. For example, if Eric has a bad knee, he’s more likely to fall at work, and that fall is more likely to be more serious. Workers’ comp insurance companies are responsible for 100 percent of the lost wages and medical bills in these situations. No one should be able to take advantage of another person’s weaknesses, in this or any other context.
Additionally, the work-related injury doesn’t have to be work-related, if you follow me. If Eric hurt his bad knee while working from home, workers’ compensation usually applies, even if he wasn’t on the clock. Legally, if your living room is a workstation, it’s just like a workstation at the office.
How long does a workers comp settlement take?
In some cases, a workers’ compensation settlement is just around the corner. Most states have strong bad faith insurance laws. These companies act in bad faith when they refuse to pay valid claims. It’s also bad faith to delay an investigation or rubber-stamp a claim as “valid” or “invalid.” So, if the issues are clear, most workers’ compensation insurance companies must settle claims within a few weeks. However, as outlined below, the issues in a workers’ compensation case are seldom clear.
Therefore, most claims must go through all, or most of, the workers’ compensation process. This process begins with an injury report. Next, a Claims Examiner reviews the paperwork in the case, mostly the medical bills, and makes a decision. Most Claims Examiners deny most workers’ compensation claims, at least in part. When the case reaches the Administrative Law Judge appeal stage, an attorney has a better chance to clear up lingering issues and settle cases on favorable terms.
Medical Bill Issues
Most states require workers’ compensation insurance companies to pay all “reasonably necessary” medical bills. Unfortunately for victims, many insurance adjusters don’t use the facts of the case to decide what’s reasonably necessary.
The first workers’ compensation systems appeared around 1910. Since so much time has passed, more companies now evaluate medical bills like football coaches scout opponents. If a team has always run to the right on third and short, it’ll probably run to the right again. In the past, if X injury cost Y dollars in Z location, it’ll probably cost X dollars again.
The facts of the case could change any of these calculations. For example, if Mike sustains a serious trauma injury at work and all the trauma centers in Z location are full, Mike must go somewhere else.
Incidentally, workers’ comp settlements not only cover doctor bills. They also cover related expenses, such as emergency transportation, medical devices, and prescription drugs.
Lost Wage Replacement Issues In Workers’ Comp Settlements
Current lost wages are relatively easy to determine. However, some insurance company adjusters keep a thumb on the scale, so an attorney must be vigilant.
Future lost wages are different. Let’s go back to Mike. Assume he sustains a serious trauma injury, like a fall from a height, that causes significant loss of mobility. When it comes to future lost wages, a company doctor might approve nothing, reasoning that Mike can tough it out and work full speed. Another doctor might say that Mike must limit his work hours and activities for the rest of his life. That’s a very big difference.
Written by
Bret Thurman
