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Settling Your Case

Workers’ Compensation provides payments, as needed for lost wages and life time medical care for an injury or illness. But, you and the insurance company can agree to permanently close your claim in exchange for one lump sum payment or annual payment. When this happens, you are waiving your rights to future compensation in exchange for a payment today. Because a workers’ compensation claim can pay both lost wages and medical care, we will review how this can effect both of them.

Can the Lost Wages Case Be Permanently Closed?

Okay, lets first talk about the lost wages. You can take one lump sum payment for your future lost wages or receive an annual payment. The amount is whatever you, your lawyer, and the insurance company agree upon. This is subject to negotiation and like all Workers’ Compensation settlements, it is tax free so I guess that is something good you can look forward too and one less thing to worry about. But you need to keep in mind that it will be the last workers’ compensation payment that you will receive for lost wages due to your reported injury.

Can the Medical Care Case be Permanently Closed?

Now we move on to the medical care part of this Blog. If you chose to end your medical care coverage permanently, the insurance company will never pay for your medical care again. You may receive a one-time lump sum payment and that will be the end of that. You may need to set money aside from the lump sum payment in a special account to pay for future medical treatment for your workers’ compensation injury.

Medicare Set-Asides

Choosing to end your medical care coverage permanently, may affect your right to Medicare benefits in the future. When settling a workers’ compensation claim the parties must take into account Medicare’s interests. This is most often done by setting up a Medicare set-aside account out of the proceeds of the settlement, which will then be used to pay for future medical treatment for your workers’ compensation injury. Failing to take into account Medicare’s interest when you settle a claim can result in Medicare refusing to pay for treatment for your workers compensation injury. If you are not sure, it is best to consult with an attorney or check with Medicare to learn your rights and responsibilities. This is important because Medicare is a Federal Program that the Workers’ Compensation Board has no Jurisdiction over it.

What Happens if I spend all my money for my medical care?

After you spend your settlement payment designated to cover your medical care such as out of a Medical Set-Aside (MSA), you can pay for care either through Medicare of out of pocket. To be eligible for Medicare you must either meet the age requirement or be receiving social security and of course, must have run out of your MSA first before reaching out to Medicare to help with medical bills. To learn more about Medicare, check out one of our previous blog about Future Medical Care.


As you can see, settling your case in workers’ compensation can be a long and tedious process. Make sure if you are feeling overwhelmed and need some questions answered or simply some guidance, to reach out to us. We are more than happy to help you go through this unfortunate event.

NOTICE: Making a false or fraudulent Workers Compensation claim is a felony subject to up to 5 years in prison or a fine of up to $50,000 or double the value of the fraud, whichever is greater, or by both imprisonment and fine.


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