It is best to contact a qualified Maryland Workers Compensation Attorney before settling any case just to make sure that the settlement is at least fair!
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Settling a Maryland Workers Compensation case is a complicated process that is often viewed by the public as only a matter of 1. make an offer, 2. come to verbal agreement, 3. issue the check. This is not the case and there are a number of steps, each one of which can hold up the process and drag the settlement out for months. Very seldom the settlement process is dragged out over a year.
To understand the distinction between a settlement and permanency see this past article.
When can settlement take place in a Maryland workers compensation case?
Settlement in a Maryland workers compensation case can take place at anytime. This means that negotiations can start the day after an accident, or even years after the treatment has come to conclusion. Most often, and in my opinion the ideal time to settle comes after treatment and after the injured worker was evaluated for a rating. Unfortunately, problems, concerns, or preferences come up that lead to settlement negotiations earlier on in the workers comp case. If settlement takes place too early in the case then the parties may not be aware of the full implications of the injury and what constitutes a fair amount of compensation. On the other end of the spectrum, if settlement comes too late in the case the value may diminish. It is best to speak with a Maryland Workers Compensation attorney to determine if settlement is right for you and when the best time for you to settle may be.
When settling there are Factors to consider and Complications that may arise!
When settling a workers comp case completely the injured worker is giving up their right to any future treatment or money under the case. If the injured worker is actively treating at the time of settlement then they may not necessarily know the extent of their injuries and it may not be a wise time to settle the case. For instance, if there has not yet been any diagnostic tests done then the injured worker will not know whether they have a fifty thousand dollar ($50,000) herniation, or a five thousand dollar $5,000 minor strain. It is best that all parties understand the extent of the injury before exploring a settlement so that no party is short changed in the end and that all walk away benefited.
One complication that often arises is the issue of future treatment. The insurer may opt to provide a medical cost projection to be used for only medical treatment in the future. This is often very helpful in the settlement process, but also helps the injured know that they have some help with future medical bills. If, however the insurer is not willing to provide a medical cost projection then the future treatment may be a major complication in the settlement process.
In order to settle Maryland workers compensation cases there must be a physician advising that there will be no need for future treatment. This is often difficult to obtain, and very often not in the best interest of the injured employee to obtain this. In some cases the work comp Independent Medical Evaluation (IME) already consists of this language so if the injured worker wants to settle completely the report provides the avenue to do so.
The documents that must be drafted for every Maryland Workers Compensation Settlement
Every settlement must be drafted in an “Agreement of Final Compromise and Settlement” along with a Maryland workers compensation “Affidavit of Understanding,” “settlement worksheet,” and “order of settlement.”
The Agreement of Compromise and Settlement is a contractual agreement that binds both the employer/insurer and the injured Maryland worker to the terms of the contract. These AFCS’ will consist of, among other, the money to be paid, money that has been paid, dates of missed work, and how medical expenses will be handled.
The Affidavit will explain to the injured Maryland employee that he or she is giving up their rights under Maryland’s workers compensation laws which include any right to money or medical treatment in the future, vocational rehabilitation, reimbursements, and any other benefit that Maryland Law provides.
The Order will provide insight to the Maryland workers compensation commission as to the break down of the settlement money after considering the Attorney’s fee, out of pocket expenses, and physician bills.
The Process of settling a Maryland Workers Compensation Case
The settlement process will start with negotiations between the insurance company adjuster or attorney and the injured workers Maryland workers compensation attorney. The negotiations should ideally start after the medical treatment has concluded and the injured worker has been evaluated by the rating physician. Once all parties come to a verbal agreement the settlement documents must be drafted and signed by all parties. As previously stated, within these documents the future medical treatment must be addressed. The parties will then sign the paperwork and submit the documents to the Maryland workers compensation commission for review and approval. All settlements in Maryland workers compensation cases must be approved by the Commission. There are no exceptions to this rule. On occasion the settlements are denied for one of a number of reasons however most of the time, a qualified workers comp attorney can ensure the settlement is approved upon first review. Once the settlement is approved and an Order is issued the injured worker can expect a check within 30 days.
Settlements that may take an extended period of time
In some instances the Maryland workers compensation settlement may include a Medical Set Aside (MSA). This is an estimate of future medical needs of the injured party. If the injured party is expected to be on medicare or is on medicare then the Medical Set Aside must be drafted, agreed upon by all parties, and then submitted to the Center for Medicare and Medicaid Services (CMS) for approval or denial. CMS will review the document to make sure that it adequately covers the interests of the federal government. At the current moment CMS is reviewing and approving or denying these MSA’s in approximately 6 weeks. This is certainly subject to change. Only after the MSA is approved by CMS can the settlement me sent to the Maryland Workers Compensation Commission for approval. If the MSA is denied then a new MSA may need to be drafted and resubmitted which can extend the time of settlement well into a year.