STRUCTURE SETTLEMENTS FOR INSURANCE
There are a lot of benefits to the injured worker of structuring a settlement; the first one is a full case settlement for the injured worker with spending cash instead of the injured worker getting a small check every week or bi-weekly with a deduction of attorney fee from that check. They get a lump sum settlement but may leave some money to use in the future for their future medical or other benefits.
There's a departure from the worker compensation system with an end to contentiousness. The injured worker splits with both the insurance company and the employer without getting engaged in further litigation regarding payment of medical bills or reduction in their benefits. It's a complete end to their worker compensation case but continue to get some money either for future wage loss or future medical.
A lot of injured
workers always complain that they don't have enough money. They have got lump
sum that's guaranteed to them. There's also a situation where injured workers
refuse to settle their worker compensation case because they feel that they
need a lifetime medical treatment with the option of the structured settlement
for future medical.
They continue their medical treatment and talk about protecting the injured worker from improvident spending of cash or medical settlement portions. They do not get a lump sum and that's supposed to last them for the rest of their life if the indemnity portion is structured.
They get some amount of cash upfront but then periodic payments for a specific period of time and then with regard to the medical settlement portions the same thing they will get as upfront seed money to start off paying their medical treatment.
Typically, its annual payments to continue on their medicals they can't go out and buy a car with it or pay off their mortgage or pay their credit card bill and then say well the settlement wasn't enough despite they are guaranteed some additional money coming in the future that sounds like a great protection. But there's still more protections available as the carrier pays medical bills at scheduled rates. when an injured worker settles on his own; on cash basis he can take advantage of the settlement priced at scheduled bill rates. what happens when you have a professionally administered structured settlement on the medical side.
Discounts are often available to the administrator and that provides a way to have the money last a whole lot longer in the claimants account or the injured workers account. Typically, year over year funding rollover for any unspent medical money some people tend to treat a little bit less when their cases are settled; some people do or perhaps they get a job with an availability of medical benefits or perhaps a spouse has medical benefits and bills start going in that direction so the remarkable point is the rolling over of unspent money from year to year and create quite a large fund over time for additional money to be paid to the injured worker should there be a medical emergency or an extreme need.
With continued professional administration of the medical billing you have protection and most importantly record-keeping services for Social Security and Medicare purposes and their administrations so that all of this record-keeping allows the injured worker to use Medicare when necessary because the backup is maintained in a professional way.
The difference where you have the claimant self-administering future medical set-aside versus using professional administration well that's a great question because he or she would have to keep scrupulous records on a regular monthly & yearly basis of their bills.
whether technologically qualified or not those records have to be properly and orderly maintained because if you run out of money in any given year you would be able to go to Medicare and have them step in and pay as they should but unfortunately they won't unless those records are made available but with professional Administration that's the service you're paying for and that's typically paid for by the injured workers employer all of that is done for the injured worker.
They don't have to worry about it and finally another benefit would be estate protections versus worker compensation benefits. This sounds a little bit gruesome but it's true worker compensation benefits when the injured worker life ends typically and that could be in the short-term; that could be hopefully in the long term; but if it's in the short term for some Unruh on work-related cause or unexpected accident there's no protection for the injured worker estate. But if you have a properly structured annuity you can provide substantial protections for the injured workers, estate and their beneficiaries so would that be a benefit for some of our older injured workers as opposed to somebody that's in their 20s or 30s.
Frankly I think it's both because accidents can happen to people in their 20s and 30s just like older folks can suffer health emergencies and sudden demise based on other nonrelated work related medical conditions it's just a good way to protect your estate and the heirs. Some benefits to the employer and carrier may be this method that allows a full settlement of complex cases that are extremely difficult to evaluate and extremely difficult to settle principally because the lawyers protect their clients effectively and don't want to stake the responsibilities that they're not skilled to handle. For a good structured settlement with professional administration gives a comfort to the attorney as he recommends to his or her clients. But the prime condition for such settlements is setting up injured workers insurance fund. Then injured in car accidents with no insurance is another point that drags attraction of the professional or policy provider.
Once the case is settled a substantial reserve reduction is made; much of risk management is assured that reserves are adequate for the open cases and released when the cases are closed. There's also protection of the settlement money from being drained by improvidence spending. There's no medical challenges if it's nominally relates the administrator will pay the medical bill directly. These structured settlements for future medical may be a good option for cases where the carrier may have settled indemnity years ago but they have a medical open because the claimants refusing to give up medical treatment.
The fundamental reason why an injured worker might not have wanted to settle the medical portion of the case because they didn't trust themselves to properly handle the money and make sure that the money would be available for their comfort and security; as a professional administration is managing a fund that pays money into their medical expending account on an annual basis, in addition to seed money so that their needs will be met and then Medicare can step in at the end. The injured worker first of all the worker compensation carrier” and “the employer” are no longer involved in the case.
There's also potential for insufficient funding for future medical. Therefore, you need to get some initial seed money for annual payments; if you are receiving more medical treatment than what was allocated for in the medical set aside. In such situation the administrator should be ready to extend the helping hand, to get Medicare involved to pay for those medical treatment that's over and above allocated in the Medicare set-aside; and to keep track. We typically want to review what the Medicare set-aside or a future medical allocation is provided either by the carrier or by a vendor and make sure it’s being consistent with the type of medical treatment that claimant has had in the past for their work injury and what the they are expected to need in the future.
There's also a downside with uncontrolled and unprotected by the States Workers Compensation Act. Under the Pennsylvania Workers Compensation Act the carrier needs to pay for reasonable necessary and related medical bills for as long as the claimant needs medical treatment if you do a full compromise and release the medical treatment controlled by the administrator, the claimant or injured worker does not have the opportunity to go to the courts and file a penalty petition if certain medical bills aren't paid; there's no fee reviews; no utilization reviews; that could be a problem for the injured worker if they are seeking some medical treatment, that may not be anticipated in the Medicare set-aside or a new type of treatment and of course as we all know once the case is settled it's done.
No
one can come back to correct the other downside to the employer carrier included
the fact when there's the potential for insufficient funding it means that the
injured worker was not adequately protected, our role as the employer as a third
party administrator as the insurance carrier is to provide adequate protections
for workers; legitimately injured and that's what we all do in part for the
living; making sure that these are adequately, appropriately and fairly funded.
At the very outset another downside is the very rare possibility of the solvency of an annuity company or professional administrator and that should always be back stopped by a plan B should that happen the injured worker may not be left without an alternative source for professional administration or funding. you are relinquishing control of the case but if you're relinquishing control of the case to someone who understands fully what they're doing in accepting.
Then I think it's appropriate for the carrier and the
injured worker to move on. so instead of the injured worker having a
relationship with the employer and the insurance company; there establishes a
contractual relationship with the administrator to provide the services to the
injured worker for as long as the contract requires but backed by a backstop
plan.
There are various types of structured settlements;
first you can have a structured settlement of the claimant’s future wage loss
and basically as we stated before typically someone would get some cash up-front
and then periodic payments so the periodic payments can be set up to provide
payments until the claimant’s death, or beyond their death and that is beneficial
to the claimant for some of the reasons.
These services though highly valuable but may not be beneficial to the claimant sometimes they are a bit hard to sell to the claimant to not get all their wage loss benefits upfront. We have the future medical set-aside if you haven't met care set aside that can be done with a structured settlement, professionally managed by an administrator to get all the medical bills handled as they have contract with different providers to get good discounted rates on the medical bills.
They would provide all the record-keeping
that the claimant requires for Medicare purposes and they would help the claim
and get medical bills paid through Medicare should the amount of money in the
medical the Medicare set-aside be insufficient.
The structured settlement may cover future medical expenses which are not covered by Medicare. The biggest area in this connection is when the claimant might be taking a medication that is not for its official use as approved by the FDA; like one of the big medications that's been in future, and amnon Medicare covered benefits would be the medication lyrica that is essentially a medication that was approved I believe for seizure activity.
Most of the claimants do not have seizures they take it as part of a pain management regimen; usually for nerve pain or post-surgical pain. Medicare does not pay for it under a Medicare set-aside. If you have a claimant who is taking that and their treating doctor says they're going to need lyrica for the remainder of their life related to this work injury that could be a significant cost to the claimant. If they settle their case and don't account for the prescription for lyrica then it would be medications that are that are being offered off-label.
The other things that are not currently being covered by Medicare speaking of off-label. As cannabis that's a really good and new in Pennsylvania “an unseen specific case law”.
The medical marijuana laws in Pennsylvania essentially do not require an insurance company to pay for medical marijuana. If there's a regular cannabis use involved with the claim, I don't see carriers covering that throughout the life of the claim but when the claim is bought to conclusion; some money allocated not specifically for cannabis but allocated with the knowledge that if a claim it feels that he or she really needs that there's some extra money put in there for it.
But in the world of carriers and third-party administrators that there may be some allocation of money for again a non-covered Medicare item. There are a couple of different types of structured settlements that are used by most carriers and they fall into the category of temporary life annuities and whole life annuities: the temporary life annuities tend to be less expensive and are paid for a specific period of time and only if the claimant or the injured workers living during that time. May be for a specific period. Let it be 13 years and the individual passes at year 2 the VEB payments would stop and again this is typically less costly for carrier.
The other category is whole life annuities
paid for the unpaid, for the claimant’s entire life and price is based on the
claimants age or rated age and these are typically much costlier for the carrier.
It depends on the length of time that's being contemplated but for a younger individual
this can definitely be seen what's best for the injured worker coupled with
what's best for the employer and the company. At the end of the day we tend to
see temporary life annuities overwhelmingly offered most of the time and
accepted by the injured worker on much rarer occasions and in case appropriate
situations we see whole life annuities.
The pitfalls of using the structured settlement for the injured worker the rated age mechanism could leave insufficient funding. The issues concerning financial health of the administrator and the annuity company is the backstop and there's no court mechanism for relief if this does go wrong in some way. The settlement is full and final.
Over the life of an injured worker there are always new treatments may be very costly indeed; at least in their initial stages of use when these new and costly treatments come out it's probably not budgeted for in the MSA and Medicare stopgap and that could be the problem for the injured worker. If he or she wants to take advantage; there's the medical choice issue, when you close your case you are losing out on an opportunity to have priced within the case.
If you're the injured worker these
newer treatments may be rated H. The “rated H” takes into account and natural
life expectancy based on some of the standard issues gender race; a
geographical location, the individual might be suffering from unrelated heart conditions,
unrelated stomach conditions, cancers things of that nature and what that does?
It comes up with an age that isn't the natural life expectancy but the life
expectancy when you bring in all of these other comorbid conditions.
we hear a lot today about the opioid epidemic “rated age”; when individuals opiate excessively assuming there's not an overdose eventually cause organ breakdown in failure and lead to the risk of death. In dealing with an opioid addiction issue, work very closely with the rated age service to make sure that all factors are considered when the rainy day is being developed.
There are some additional benefits of using the structured
settlement the injured worker can roll over from year to year, and the unspent
money so if there's other insurance available; that the injured worker may be
able to put medical treatment; through such as coverage through a spouse, they
may have gotten a new job that has insurance, they may be able to hold over
some of the unspent money year to year and have additional money for the future.
There's the opportunity to have a reversionary interest back to the funder of
the annuity for monies that are unspent at the time of the claimant’s death and
there's also more medical choices with using the structured settlement well. The text is related to hospital insurance, a company indemnity to the claimants. Please feel free to comment and give your valuable opinion.
Source
webinar: www.gfi.com/webmonitor
Source:(Sherry
Daugherty with Paul Fiers Philadelphia
office www.jfn.co.jp/toho)
very Nice post...
ReplyDeleteSindh Police