What to Look For in a Structured Settlement Company

 

The use of structured settlements in large and catastrophic workers’ compensation claims is well recognized as a way to reduce the overall settlement cost while at the same time providing the injured employee with a fair claim settlement.  However, a factor often overlooked in structured settlements is the identification and selection of the best structured settlement company.

 

There are several characteristics and qualities that should be considered in the selection of the structured settlement company.  They are:

 

  1. Experience.

You want a structured settlement company that has a track record.  A structured settlement company that has been around for decades has more resources to draw from then a structured settlement company that has been in business for a few months.  The more structured settlements the company has completed in the past, the greater likelihood that they know how to deal with every possible scenario that could interrupt or prevent a structured settlement from occurring.

 

 

  1. Ability to Design Settlements.

The structured settlement company must have the ability to taken into consideration the needs of everyone including the injured employee and employee’s family, the attorney for the employee, the employer and the employer’s workers’ compensation insurer.  The structured settlement has to be designed to be flexible to address the needs of the employee while maintaining control of the settlement cost for the insurer.

 

The structured settlement company consultant must have an in-depth knowledge of sophisticated damage analysis and life care plans, along with the different types of trusts that can be included in a structured settlement.  By understanding the injured employee’s future financial needs and future medical care, the structured settlement consultant can design a creative solution that benefits all parties involved in the workers’ compensation claim.

 

 

  1. Resources.

A structured settlement is basically an annuity (or annuities) purchased from a life insurance company.  It is therefore essential for the structured settlement company to have several top rated life insurance companies available to provide the annuity/annuities.  By having several highly rated insurance companies available, the consultant can shop the settlement package with the different insurers to obtain the lowest overall cost for the structured settlement.

 

 

  1. Reputation.

There are structured settlement companies that work only with the plaintiff attorneys and there are structured settlement companies that specialize in working only with the defense attorneys.  These companies are well known to both the sides of the legal aisle, and are often mistrusted by the other side.  A structured settlement company that works with both plaintiff attorneys and defense attorneys must maintain a reputation of being unbiased and fair in all their dealings.  By selecting a structured settlement company that has the trust and extensive experience working with both sides of the legal aisle, the mistrust that hampers and prevents some structured settlements from occurring is removed.

 

 

  1. Geographical spread.

The structured settlement company should be somewhat local.  If the structured settlement company has only one office or even several offices in another part of the country, it is difficult for the structured settlement consultant to meet with the various parties involved in the injury claim. An example – if the structured settlement company is located in Florida and the injured party is in California, the structured settlement company will be less effective.  The structured settlement company that has a complete geographical spread and can provide a local consultant whether the injured employee is in Maine, Hawaii or somewhere in between will be able to provide the best service.

 

The proper selection of the structured settlement company can have a significant impact on the cost of the structured settlement.  For assistance in identifying and locating the best possible structured settlement company, please contact us.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com.

 

Author Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.

 

©2013 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

How to Plan, Prepare, and Negotiate Claim Settlement

 

Claim Resolution Should Start Immediately

 

Self-insured employers who utilize their own in-house adjusters often ask questions about how to arrive at a fair and equitable settlement of the workers’ compensation claims, especially claims where the employee is represented by an attorney.  The reasonable resolution of a workers’ compensation claims does not start when the employee’s attorney sends a demand letter toward the end of the claim, the proper resolution of the claim starts immediately upon notice the employee has been injured in an accident.

 

The first thing an employer can do to move a workers’ compensation claim toward a fair settlement is to provide immediate medical care following an injury.  In the states where the employer selects the medical provider, the employee should be directed to the nearby industrial clinic previously chosen (with the name/address of the industrial clinic posted on the employee’s bulletin board).  In the states where the employer cannot mandate the medical provider, a short listed of recommended doctors should be posted on the bulletin board.

 

The first phone call the employer should make following an injury is to the medical provider’s office notifying them that the injury just occurred and advising them the employee is on the way to their office.  This will streamline the admittance process for the injured employee and will reduce the amount of time between injury and medical treatment.  When the injury to the employee does not appear to be severe, the initial phone call to the medical provider will also allow you to remind the medical provider of your company’s light duty program for injured employees.

 

The second phone call immediately following the first phone call should be to the claims office/adjuster advising of the new workers’ compensation claim.  The protocol for your in-house adjusters should be to contact their fellow employee the same day to discuss their injury and the claim handling process.  By taking control of the workers’ compensation claim the first day, you start laying the ground work for the claim settlement.

 

 

On-Going Contact is Essential

 

During the course of the employee’s recovery is essential to have on-going contact with the injured employee by the employee’s supervisor or department manager or workers’ compensation coordinator or adjuster (whoever is delegated the responsibility).  By simply asking the employee to keep you abreast after each doctor’s visit of what the doctor had to say, will keep the lines of communication open and assist in getting the employee back to work on modified duty sooner.  It will also make settling the claim easier as the employee sees the employer less as ‘the other side’ and more as a partner in the recovery process.

 

In states where the employee selects his own medical provider, often the employee’s attorney will send the employee to a doctor the attorney knows will keep the employee off work for as long as the plaintiff attorney wants the employee to be off work. [In these cases the employee’s release from medical care will coincidentally occur when the employee begins to complain to the plaintiff attorney that they are having financial issues, as they have not adjusted their life style to live on the workers’ compensation disability payments].  When the medical provider is non-cooperative about returning the employee to modified duty work, the in-house adjuster can arrange for a peer review of the medical treatment being provided or arrange for an independent medical examination to show the employee is capable of modified duty work.

 

If the injury is severe, a nurse case manager should be assigned to the claim to manage and direct the medical care as much as possible.  By facilitating the medical care through a nurse case manager, the employee will make a quicker and better recovery with a lower overall impairment rating.  This will impact the settlement negotiations favorably.

 

 

Seek Settlement When Reach Maximum Medical Improvement

 

As soon as the medical provider indicates the employee has reached maximum medical improvement, an effort should be made to immediately move forward with settling any compensation owed for a permanent partial impairment. A few states still use the impairment rating combined with the employee’s disability compensation rate to establish the claim’s settlement value.  Most states however have gone to what amounts to a negotiated settlement of the workers’ compensation claim.

 

All the steps above are designed to manage and control the claim resulting in a lower initial settlement demand by the employee or the employee’s attorney.

 

Once the employee has reached maximum medical improvement and has been assigned an impairment rating, the in-house adjuster should thoroughly review the file and the medical facts of the injury to establish a settlement range for the claim. Once the settlement range has been determined, the adjuster should develop a negotiations strategy on how the adjuster plans to reach a value within the settlement range.

 

If any part of the settlement range exceeds the adjuster’s settlement authority, the adjuster should contact the person who can grant additional settlement authority with a detailed explanation as to why settlement authority over the adjuster’s settlement authority level is needed.

 

 

Employee Attorney Should Make Initial Offer

 

The in-house adjuster should not make the initial settlement offer until after the employee’s attorney has made their initial settlement demand.  If the adjuster makes the initial offer, the employee’s attorney will negotiate up from that point.  Better results are normally obtained by letting the employee’s attorney make the initial demand and negotiating down from the attorney’s settlement demand.

 

Once the adjuster has the demand from the employee’s attorney, the adjuster should review the attorney’s demand to determine how reasonable, or unreasonable, it is.  The adjuster should evaluate the key points the attorney uses to support his/her demand and determine if there is any justifiable reason to reevaluate the adjuster’s settlement range.

 

The adjuster’s initial offer to settle the claim should be as far below the mid-point of the adjuster’s settlement range as the employee’s attorney initial demand is above the mid-point of the adjuster’s settlement range.  The adjuster’s initial offer should include some of the key points on which the adjuster based the settlement range.

 

When the employee’s attorney makes a jester toward settling the claim by lowering their demand, the adjuster can mirror the attorney’s step toward claim settlement by raising the settlement offer a similar amount.  By mirroring the attorney’s settlement demand reduction with an increase in the settlement offer of the same size, the adjuster signals to the plaintiff attorney what the settlement amount will be without committing to anything.

 

 

Be Aware of Attorney Negotiating Tactics

 

A favor ploy of plaintiff attorney’s is to stop negotiating and state they have reached their bottom line.  This is an effort on the attorney’s part to get the adjuster to bid against him/herself and to raise the settlement offer multiple times without the attorney lowering the settlement demand any.  This pushes the adjuster to the high end of the settlement range if the adjuster falls for the ploy.  It also creates a situation where the adjuster will have to overpay to settle the claim, or enter into an extended defense of the claim.  The adjuster’s best response to the attorney stating they have reached their bottom line, is a simple, “yeah, me too.  I was hoping to settle the claim, but I have reached my settlement authority.  If your client decides to lower their demand any, please let me know and I will pass it along to the higher ups”.

 

A tactic used by some attorneys to try to force a higher than justifiable settlement is to claim the employee has had a relapse.  The attorney tells the employee to go back to the doctor and emphasis how much pain they are having, the difficulties they are incurring due to their impairment, and to start treatment with the doctor in an effort to get a higher impairment rating.  This tactic should be countered with an independent medical evaluation to verify or disprove the worsening of condition claim.

 

By preparing for settlement negotiations from the start of the claim, and by planning and managing the settlement negotiations, the in-house adjuster can obtain a fair and reasonable settlement.  While it takes a level of high quality claims handling to obtain an equitable settlement of the workers’ compensation claim, it is well worth the effort to obtain a proper negotiated settlement.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact:RShafer@ReduceYourWorkersComp.com.

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: mstack@reduceyourworkerscomp.com.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Attorney Perspective on Lump Sum Settlements, You Know Outcome Before Papers Are Filed

 

WCRI Study Diligently Done, Missed the Point

 

Workers Compensation Research Institute (WCRI) has recently published a study of post-settlement lump sums and return to work. With all due respect to a diligent study, it must be said that WCRI was given the task of analyzing the engine of a vehicle by commenting on the paint job and the tires – which is no substitute for a look under the hood.

 

Attorneys, however, see and hear far more than they feel comfortable with discussing. Nothing they can’t discuss, of course, but the discussion would be too much “inside baseball”, and would reveal the insider’s view of “disability”.

 

 

Attorney’s Can Tell You Age & Attitude Have Significant Influence

 

WCRI looked at overall RTW patterns. An attorney quickly learns that age and attitude have far more to do with RTW than levels of disability. The group that receives lump sum settlements to close extended disability claims is actually composed of three groups.

 

 

3 Groups: Older Workers, Younger Workers with History, Motivated Workers

 

One is composed of older workers, near retirement, with concurrent degenerative medical conditions. A second is composed of younger workers who have already established a pattern of instability with employment situations and will, in all likelihood, continue that pattern. A third group is workers who truly want to work and have been sidelined more by comp procedures than disability.

 

Unfortunately, an outside researcher is unlikely to be able to sort the groups out, although a comp lawyer could indentify most as they walk into the office for the first time.

 

Statistics fail when they average performances of groups that are truly separate; the conclusion will be either too high or too low for the individual groups. Success will only come when the ability to recognize discrete groups is achieved.

 

 

Greed Rarely Major Factor

 

When the author worked on SIU matters, the question was always how to deal with “fraud” as though that was always synonymous with “greed”. Results in suppressing fraud soared when it was realized that pure greed was almost never the major factor. Instead, anti-social rage, whether or not it produced much money, was the principal motive, followed by short-sighted methods to deal with a plunge in family income coming in second. Neither could be described as “greed”.

 

Lawyers, employers and carriers needn’t have near-psychic levels of skills to predict results in lump-sum settlement situations. Practically speaking, there isn’t an infinite, or even a very large, range of possible outcomes. But the skill at recognizing them can only come from up close and personal interactions with workers. Lawyers can make a prediction quickly, but the employer already knew the outcome before the first papers were filed.

 

 

Employers to Share as Much Information as Possible

 

The lesson for employers is to share as much information with the carrier as soon as possible. The lesson for carriers is to pose the right questions to the right people. The right questions lead to the right claims solutions. There are few surprises.

 

 

 

Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers’ compensation, Social Security disability, employee disability plans and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100. medsearch7@optonline.net

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com.
WORKERS COMP MANAGEMENT MANUAL:  www.WCManual.com
MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.php

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

 

Do Lump Sum Settlements Aid or Detract from Employees Returning to Work

 

 
2,000 Injured Worked Studied for 4 years After Settlement
 
I recently read article from Risk & Insurance Online, where they state that the Boston-based Workers Compensation Research Institute looked at more than 2,000 workers injured in Michigan in 2004 who received lump sum settlements.  The researchers followed their employment experience for the next 4 years. The study found that:
 
  1. Three-quarters of the injured workers who received lump sum settlements did not change their employment status, “which means that many of those who were employed at the time of the lump sum stayed employed and those that were not employed remained unemployed”
 
  1. Of those who did change their employment status, nearly a third who were employed at the time of the settlement left work, and nearly a fifth of those who were not employed attained employment after the settlement.
 
  1. Average employment in the sample increased from 25% of workers at the time of the lump sum settlement to 32% of workers one year after a settlement. “The exception is older workers who experienced a decline in employment after a settlement.”
 
“This is an important study because we need to find out whether settlements discourage return to work for injured workers who want to return to work or assist them in closing this chapter of their life and moving on with their career” said Bogdan Savych, the author and a public policy analyst at the WCRI. [WCx]
 
 
Only small percentage of Employees Looking for an Early Retirement
 
The common consensus or stereotype among adjusters could be that workers trying to obtain a lump sum settlement are in it for the wrong reasons, looking for a way to fund an early retirement and remove themselves from the workforce forever.  Sure this could be true, but obviously this is for a small percentage of the injured workers looking for a lump sum settlement according to this study. 
 
There could be a ton of variables, including age of the worker, type of injury, severity of injury, post-injury medical and physical limitations that could hinder a gainful return to work in the occupation that the worker desires, overall economic reasons forcing a return to work, and so on.
 
Adjusters forget that a person’s life does not end after a settlement has been reached, rather it is just the end of the file for the adjuster.  Obviously younger workers could rarely sustain a prosperous life from the time of their settlement to their death, meaning that they would have to stretch those settlement monies over the course of their whole lifespan.  On the opposite side, and as the study shows, older workers nearing retirement would rarely return to full time gainful employment after a settlement, since they may not need to work anymore, but again this could vary on Pensions, 401ks, savings account amounts, and the like.  It is feasible to state that maybe older workers who wished to retire after a settlement still could not do so, based on their own personal economic needs. 
 
 
In General, People Return to Work After Receiving a Settlement
 
Looking at this from a general broad perspective, this study proves that people return to work after receiving a settlement for their comp injury.  The adjuster has incentive to attempt to resolve the case as soon as they can, because once the settlement is completed the case is off the books of the carrier, and the file is closed forever, if a full/final settlement is to be performed. Plus it ends the case for the injured worker and the employer, and everyone can move on with their life.
 
 
Not Considered in Study is Various Ways to Settle a Case
 
One thing this study did not look at which is important is the various ways to settle a case, including an indemnity-only settlement, which keeps medical open.  This is becoming more and more of a trend, just because it closes one of the expense doors, wage loss, and the adjuster can settle the medical exposure at a later date once a clamant slows down on treating and nears Maximum Medical Improvement.  Making this settlement more common is the involvement of Center for Medicaid and Medicare Services and the need for a Medicare Set Aside to resolve all aspects of a claim if a person’s injury is reportable to Center for Medicaid and Medicare Services because they are on Social Security.  If the worker is billing Medicare for their treatment in error, then there is a huge lien to address with Center for Medicaid and Medicare Services, and this can involve many headaches, and the many months of time that have to go by while the carrier negotiates with Medicare on what is their responsibility to pay, and what is the responsibility of Medicare.
 
Another option is a structured settlement, where an injured worker receives payment from a third party in excess of what a carrier pays to fund the structure, providing incentive to the injured worker to take this type of settlement because in the end they will net more monies than if they just took a check from the carrier to settle.  The downside for the worker is that they do not get all of the settlement money up front, but rather in monthly payments over a specific period of years, with interest attached.   [WCx]
 
 
Summary
 
Speaking generally, the study proves that a worker will indeed return to work after a settlement is obtained.  What the study fails to take into account is the several factors that go in to accepting a settlement, and then having to either return or not return to the workplace.  Making it more complicated is the varying types of settlements that are out there, and becoming more and more popular as conditions warrant.  I believe the most important thing to take away from this study is that when considering settlement; adjusters should not look at it as the worker looking for an early exit out of the workforce.  Instead look at it as a way of resolving the claim, so all parties can move forward. 
 
Sure, if adjusters are pessimistic and are viewing the settlement only as a way for the worker to obtain a lifelong vacation, this can hinder negotiation.  Instead adjusters should put themselves in the boots of their injured claimants. What would they do if they were faced with these options, and how can you make it be the most attractive as a way to end a claim?  Should it be lump sum, structured, indemnity-only, or anything else?  Is the claimant in need of lifelong medical care, or have they reached Maximum Medical Improvement and they are as good as they are ever going to be? And no matter what the answers are to these questions, what type of settlement would benefit all parties?  It is when we answer these questions, and place ourselves on the other side of the fence, that we can settle claims in a beneficial way to all parties, and move on to the next challenging claim that awaits us. 
 
 
 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.

 

Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com Contact mstack@reduceyourworkerscomp.com

 


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MODIFIED DUTY CALCULATOR:  www.LowerWC.com/transitional-duty-cost-calculator.php

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

Drug Company Settled Substandard Allegations with $40 Million Fine

 
GlaxoSmithKline (GSK) agreed to pay $40.75 million to settle allegations it was manufacturing substandard prescription medications in the early 2000s.
 
 
GSK was alleged to have involved in production of substandard products, made from 2001 through 2005 at its former manufacturing facility in Cidra, Puerto Rico. Those included the antidepressant Paxil CR, the anti-infection ointment Bactroban, the sterile anti-nausea medication Kytril, and the type-two diabetes pill Avandamet.(WCxKit)
 
 
The company did not admit to any wrongdoing or liability of any kind under these states’ consumer protection laws in this settlement. According to information from the company, which has offices in the U.S. and Great Britain, GSK chose to settle the matter to avoid the expense and uncertainty of protracted litigation and trial.
 
 
In 2009, GSK closed the plant because of declining demand for the medicines made there. GSK sold the facility in 2010. Prior to selling the facility, the company reportedly brought the plant into compliance and to a level of performance that satisfied both GSK and the FDA.
 
 
According to the company, GSK’s manufacturing division has a strong track record of quality and compliance with current Good Manufacturing Practice (cGMP) requirements. Various regulatory agencies – including the FDA – conduct an average of more than 100 inspections each year at over 80 GSK manufacturing sites located in over 30 countries.(WCxKit)

The FDA has raised no material issues as a result of its other inspections, according to GSK. The fine will be divided among 37 states and the District of Columbia as part of the agreement.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact: Info@ReduceYourWorkersComp.com.


Learn about our Work Comp Book:
www.WCManual.com
 
 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

Settling Workers Comp Claims with Undisclosed Agreements in NY

For decades, carriers have grappled in New York with the problem of permanent partial disability (PPD) claims. The problem is that whenever the Board finds an injury has led to “a permanent partial disability ” the carrier must post adequate reserves to cover a lifetime of future earnings loss PLUS reserves to cover a lifetime of future medical.
 
 
Such reserves remain in an employer’s x-mod for decades and drive premiums and costs to intolerable levels. Without a method of clearing such claims from the books, the New York Board’s historically liberal approach to PPD claims (20,000/yr by 1990) would not be possible. (WCxKit)
 
 
In 1947, the “lump-sum settlement” was created. But the lump-sum was only for wage loss because the Board was reluctant to curtail medical benefits. With Medicare beginning computer searches in the 1980s to locate workers comp claims (and transfer liability to carriers and employers) a new settlement, the “Section 32” was created to close out future medical liability by awarding a sum to represent lifetime future medical as well as wage loss.
 
 
Still, that left another issue unresolved. It was well known that many people willfully remained out of work until a settlement was approved and then applied for the old job. Some employers were reluctant to rehire many of these workers, in many cases for valid reasons having to do with dysfunctional attitudes. That, in turn, led many employers to oppose settlement unless the worker agreed not to seek reemployment.
 
 
These agreements remained an embarrassment. The agreements were never disclosed to the Board as part of the settlement and, therefore, rendered the settlement void.
 
 
A recent decision, “Nickel v. Pilgrim Psychiatric,” 5/5/11, has put thousands of these closures at risk. The “Nickel” claims, as well as the earlier “Hart v Pageprint/De Kalb”, 6 AD 3d 947, reversed closing settlements because the Board procedure of having a hearing prior to approving a closing was not followed. The purpose of such hearings was to make sure everyone, including the Board, understood all the terms of the settlement.
 
 
The undisclosed agreements for an employee not to seek rehire are clearly in jeopardy. Not only do they violate the New York work comp law, permitting a reopening and posting of substantial lifetime reserves, but they might also violate the Americans with Disabilities Act.
 
 
The inexorable law of attrition, based on the temporary nature of human life spans, has forever closed most of the old claims with such agreements. In addition, most people, once a claim is closed, get on with their lives and don’t care to revisit the claim experience. Therefore, an employer probably will not be faced with a flood of reopening. However, it cannot be guaranteed all prior claims will remain closed.
 
 
The best plan of action for an employer to take is to not repeat past error. The silver lining is that if a worker refuses a valid return-to-work effort the employer would be under no general obligation to rehire. Open-ended early RTW efforts, made BEFORE a final settlement, can avoid the problem.
 
 
An unexpected benefit of early RTW initiatives is, in many cases, that it results in a closing of the comp claims, and a reestablishment of hearing capacity, WITHOUT a settlement. (WCxKit)
 

Author Attorney Theodore Ronca is a practicing lawyer from Aquebogue, New York. He is a frequent writer and speaker, and has represented employers in the areas of workers compensation, Social Security disability, employee disability plans, and subrogation for over 30 years. Mr. Ronca has 21 years experience in searching and retrieving medical records and many other types of documents for defense of workers compensation claims. Contact Attorney Ronca at 631-722-2100 or medsearch7@optonline.net

 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

ALERT: Hearings are at the END of a Claim Not the BEGINNING

Timely Tips from Ted
Trying to dig out from over litigation for two decades, the New York Workers Comp Board encourages settlements. Not only has the number of settlements grown, but also they carry their own dangers.
The problem with settlements is the parties involved and the Board lose interest in further investigation of facts. Furthermore, it is assumed the employer gets to pay a non-trivial amount, meaning an attorney can rely on settlements as a substitute for proof. In time, “nuisance value” drives the system – and “nuisance” is expensive since it does not need much in the way of fact or reality to sustain it.
The solution is to have a compelling supply of facts in the arsenal – facts which must be obtained as soon as possible. Attitudes formed without facts quickly become set in stone.
A time line of typical New York workers comp claims shows a period of months, not weeks or days, before a carrier begins to obtain evidence which can limit the size of a claim. However, an employer frequently has information of similar utility already at hand and can get it into a Board file within days. (WCxKit)
Prior claims, comp or accident, known to the employer provide valuable knowledge about expectations during settlement talks. A history of a prior major settlement indicates the need for considerably more preparation. A history of a series of minor settlements demonstrates a willingness to return to work quickly.
Prior periods of employment, showing average length of time with employers as well as periods of absence from work, can provide warning of a claim that should not be settled with out in depth investigation.
Employers are not expected to conduct formal investigation, although some have been known to do so with devastating results. Instead, the employer can jump start a proper defense with prompt dissemination of useful info – even if only with a phone call.
Last year, we discovered a claim  we were investigating for an employer was going to be "disposed of" on a "settlement" because the judge saw problems were starting to appear (based on our preliminary investigation showing 8 known prior claims).
 We made a quick call to the carrier. "How much will the settlement be?" "Don't know.” Some start at $200,000.  Those aren't settlements. They are a pot of gold for practically no work. The attorney fees will be in the $5,000-$10,000 range, but the hours of actual work are less than 10 at $500 to $1,000 an hour.
See the danger? AND, the carrier dumps it into the employer’s X-mod.
And Medicare hands you the bill for all future treatment.
And what do you think the co-workers hear?
Was this carrier interested in what my further investigation might show? Well, “maybe.” Maybe??!!  They are going to settle without knowing a thing about 8 prior claims. We are not even sure they were settled. Some were just dropped. (WCxKit)
This is, another reason, as if you needed one, TO DO MORE early prep. Be proactive.
In claims, any action based on expedience rather than knowledge never works to the benefit of the person paying.
Author: Attorney Theodore Ronca is a practicing lawyer from Aquebogue, NY. He is a frequent writer and speaker, and has represented employers in the areas of workers' compensation, Social Security disability, employee disability plans, and subrogation for over 30 years. Attorney Ronca can be reached at 631-722-2100.
Books:  http://www.LowerWC.com/workers-comp-books-manuals.php
Comp Costs Calculator:  http://www.LowerWC.com/calculator.php

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
  
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact
 Info@ReduceYourWorkersComp.com 

Is Workers Comp Settlement Marital Property

How Would You Decide: Kentucky Court Finds Lump Sum Workers' Comp Settlement is Marital Property—Divides Equally Between Injured Worker and Spouse?

Here's What Happened
Husband and wife,  Kentucky residents, were married in 2000 and had two children born of the marriage. Husband suffered a work-related injury in January 2006. Husband and wife separated in mid-April 2006. Husband filed an application for workers' compensation benefits after the separation. A settlement agreement providing for $30,000 was approved after wife petitioned for dissolution of the marriage. The breakdown of the settlement included $15,000.00 for future and past income benefits; $10,000.00 for waiver of future medical benefits; $2,500.00 for waiver of his right to reopen; and $2,500.00 for a waiver of his right to vocational rehabilitation. The trial court concluded that the husband's entire workers' compensation settlement was a marital asset and awarded the wife one-half of the settlement. The husband contended the trial court erred by determining that his entire workers' compensation settlement was a marital asset and that the trial court failed to divide the settlement in just proportions.

Here's What The Court Decided
In Day v. Day, 2009 Ky. App. LEXIS 248 (Dec. 11, 2009),  the Court of Appeals of Kentucky held there had been no error. Citing Quiggins v. Quiggins, 637 S.W.2d 666 (Ky. Ct. App. 1982), the court noted that workers' compensation benefits in either the form of a lump sum settlement or ongoing benefits are marital property. The court also observed that the marriage had not been of short duration, that the husband was not totally disabled, and that the husband had the ability to obtain appropriate job skills but had chosen not to do so, the appellate court found that the trial court had appropriately found that the parties equally contributed to the marriage. The trial court found that the parties contributed equally to the marriage. The trial court had broad discretion in dividing marital property. (workersxzcompxzkit) While the court was mindful that the husband was injured just three months prior to the separation, the appellate court could not conclude that the trial court had abused its discretion.

See generally  Larson's Workers' Compensation Law, § 89.08.

Tom Robinson, J.D. is the primary upkeep writer for Larson's Workers' Compensation Law (LexisNexis) and Larson's Workers' Compensation, Desk Edition (LexisNexis). He is a contributing writer for California Compensation Cases (LexisNexis) and Benefits Review Board – Longshore Reporter(LexisNexis), and is a contributing author to New York Workers' Compensation Handbook(LexisNexis). Robinson is an authority in the area of workers' compensation and we are happy to have him as a Guest Contributor to Workers' Comp Kit Blog. Tom can be reached at: compwriter@gmail.com. http://law.lexisnexis.com/practiceareas/Workers-Compensation

Podcast/Webcast: Claim Handling Strategies
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http://www.workerscompkit.com/gallagher/podcast/  Claim_Handling_Strategies/index.php 

Visit Our Websites: Reduce Your Workers Comp: www.ReduceYourWorkersComp.com/

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.
 
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ ReduceYourWorkersComp.com t.com

6.2 Million Settlement Approved in EEOC vs Sears for Inflexible Leave Policy

The EEOC  (U.S. Equal Employment Opportunity Commission) announced court approval of the distribution of a $6,200,000 compensation fund in the landmark Americans With Disabilities Act (ADA) litigation between the EEOC and Sears, Roebuck & Co. The distribution is being carried out pursuant to the terms of a consent decree approved by Federal District Judge Wayne Anderson on September 29, 2009.

In its lawsuit  against Sears, the EEOC alleged Sears maintained an inflexible workers’ compensation leave exhaustion policy and terminated employees instead of providing them with reasonable accommodations for their disabilities, in violation of the ADA. The case resulted in the largest ADA settlement in a single lawsuit in EEOC history.

Under the terms  of the decree, the EEOC provided claim forms to certain Sears employees who had been terminated under Sears’ workers’ comp leave policy. The claimants were asked to report to the EEOC, among other things, the extent of their impairments, their ability to return to work at Sears, and whether Sears had attempted to return them to work.

Based on these criteria,  the EEOC found that 235 individuals were eligible to share in the settlement. The average award was approximately $26,300. More than 20 claimants were found to be ineligible by the EEOC. As with all EEOC litigation, none of the settlement fund are retained by the EEOC; all of it is distributed.

“It is a satisfying  day indeed when victims finally receive compensation for the wrongful discrimination they have endured,” said EEOC Acting Chairman Stuart Ishimaru. “The EEOC is pleased and proud that we fought long and hard on this case to protect the rights of workers with disabilities, and that many Sears employees will now benefit from our law enforcement efforts.”

EEOC Trial Attorney  Aaron DeCamp noted that, in addition to the disbursement of settlement funds, the EEOC is seeing positive effects from the consent decree. (workersxzcompxzkit)

“As a result of the decree,  we believe Sears has an improved workers’ compensation leave process, and it has posted notices regarding the decree," DeCamp commented. "We know that employees have been seeing the notices because we’ve been receiving inquiries as a result. So we think it’s pretty clear that our lawsuit genuinely benefited the employees of Sears and strengthened the company’s human resources processes.”

The lawsuit, filed in November 2004, was assigned to Federal District Court Judge Wayne Anderson of the Northern District of Illinois and Magistrate Judge Susan Cox, and is captioned EEOC v. Sears Roebuck & Co., N.D. Ill. No. 04 C 7282. Judge Anderson entered the order approving the monetary distributions on February. 4, 2009.

Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers' Compensation costs, including airlines, health care, manufacturing, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. He can be contacted at: Robert_Elliott@ReduceYourWorkersComp.com or 860-553-6604.


Podcast/Webcast: Claim Handling Strategies
Click Here
:
http://www.workerscompkit.com/gallagher/podcast/  Claim_Handling_Strategies/index.php  

We accept articles about WC cost containment. Contact us at: Info@ReduceYourWorkersComp.com.
Visit Our Websites: Reduce Your Workers Comp: www.ReduceYourWorkersComp.com/
Workers Comp Kit: www:workerscompkit.com/

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers' comp issues.

 
©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com

Why do some companies use Structured Settlements when settling large claims?

Structured settlements are a tool to resolve large workers’ compensation claims. When settling a claim the claimant might receive either a lump sum payment (one payment) or a “structured settlement” (payments made over time). Structured settlements are a type of annuity. They are a natural fit with workers’ compensation claims since claimants were already accustomed to receiving weekly payments. Settling a claim with a structured settlement instead of a lump sum payment allows claimants to continue receiving payments on a scheduled basis while also:

· giving them the option to designate a beneficiary,

· to receive benefits tax-free,

· plan for future family expenses such as college and

· allowing some the opportunity to receive more money on a coordinated basis once the structured settlement value was pro-rated over a lifetime.

Structured settlements are a benefit to employers too since the annuities are funded with “present value” rather than “ultimate value”. Thus, employers are able to cap their exposures and close the file with less outlay than if they funded the entire amount up front. Employers with high retentions and self-insured employers have input into which structured settlement company they use. If you select a firm to work with, include that in your Special Handling Instructions.

We appreciate Richard Regna, CSSC, for providing this material. If you’d like additional information, you can post a comment or contact Richard directly at rregna@sfainc.com Structured Financial Associates, Inc. website: www.sfainc.com

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