In 2017 there were 183 fatal work injuries in North Carolina. For every fatal workers’ compensation injury, there are many more that leave workers with permanent disabilities.
Some injured workers face long periods of time out of work. Others may have ongoing medical treatment needs. Many injured employees will have both.
If you’ve been injured at work, sooner or later you (or your lawyer) may get a call from the workers’ compensation adjuster, asking you if you’re ready to settle. What does it mean when you settle a workers’ compensation claim? Should you settle your claim at all; if you want to settle, what are your options?
In North Carolina, there are different types of workers’ compensation settlement agreements. Workers’ compensation settlements are always voluntary.
So there is no way the Industrial Commission (the court that handles workers’ compensation claims) can force the defendants to give you a bigger settlement. Here is a closer look at settlement in NC workers’ compensation cases.
Compromise Settlement Agreements
Also known as a clincher, a compromise settlement agreement is a complete and final settlement of your claim. Although clinchers typically involve a lump sum payment, sometimes you can choose to enter into a structured settlement. A structured settlement means that the settlement funds are paid over time.
You should always obtain legal advice from a North Carolina workers’ compensation attorney before signing a clincher, as it requires you to give up all rights to your claim. Finding a board-certified workers’ compensation attorney is important. Why? Because entering into a final settlement may not be in your best interest.
One trap for unsuspecting people receiving workers’ compensation: Medicare. Most injured workers are surprised to hear that Medicare believes that it has an interest in every workers’ compensation settlement. You don’t have to be 65 years old either, or even be receiving Medicare.
Why? Because Medicare does not want to be on the hook for any work-related medical treatment. So you are wise to consult with a lawyer to determine whether Medicare’s interests have been taken into account in the right way. Not setting aside money for Medicare in the right cases can eat into Medicare benefits in the future.
Form 26A Settlement Agreements
Although they are not a full and final settlement, Form 26A settlement agreements allow for the payment of permanent partial disability compensation. Permanent partial disability is the permanent damage to your body part or parts from the injury. Your treating doctor may refer to this as your rating.
In order to receive payments for the permanent rating, you sign a Form 26A (Employer’s Admission of Employee’s Right to Permanent Partial Disability Benefits). The Industrial Commission reviews and approves the form. If approved, you will receive weekly payments that add up to the value of your rating. By accepting the money, you relinquish your right to wage loss benefits in the future.
The law can get complicated when it comes to the effect on your case that an approved Form 26A has. You could have a change of condition that would allow you to reopen your case for wage loss, for example. You also keep your rights to medical treatment for two years from the last payment of compensation too – and that right continues for two years after each bill is paid for medical treatment, or each check is issued.
When Should You Settle?
The short answer is: you should settle when it is best for you. Sometimes your claim has not been accepted by the insurance company, and settlement is a good option.
When your claim is accepted and the insurance company is paying for treatment and time out of work, it can be difficult to value while you’re still recovering. Most injured workers are advised to wait until their condition stabilizes and they are not likely to benefit from more medical treatment. At this point, the severity of your injury and its effect on your ability to work will be better known.
What Happens After You Settle?
If you and the insurance company reach a settlement agreement, it must be approved by the North Carolina Industrial Commission. The Industrial Commission will review the documentation that you file and approve the settlement if it appears to be fair to all parties. The insurance company is then required to pay you within 24 days after the approval.
Is Settlement Mandatory?
There is no legal requirement for you to settle your case, and in some cases, you may be better off leaving your case open. State law allows you to forgo a permanent disability award in favor of receiving wage loss benefits on an ongoing basis. A board-certified workers’ compensation attorney will advise you whether this option is appropriate for your situation.
Other concerns involve benefits that can negatively affect (or be affected by) a settlement. They include:
- Medicare or Medicaid
- Social Security Disability
- Private disability and health insurance plans
An attorney will carefully consider these issues in order to determine whether a settlement agreement is advisable for you.
Let Us Help
At Johnson & Groninger PLLC, we understand how stressful it is to deal with workers’ compensation insurance companies when you’re trying to heal. Let us help.
Our firm includes two board-certified North Carolina workers’ compensation attorneys who have an excellent track record in client advocacy. We will help you estimate the worth of your case and give you an honest and accurate evaluation of the settlement offers.