When an insurer contests a worker’s compensation claim, an injured worker is forced to seek alternative sources for the payments of medical bills and assistance for the support of his or her family. Health insurers may provide payment of medical expenses if a worker’s compensation carrier refuses to voluntarily pay a claim. The need for treatment is every bit as crucial in these circumstances as it is in a case where the insurer has agreed to pay. Household bills such as mortgage or rent payments must be met. Essentials such as food and clothing must be provided.
Public assistance may also be a source of payment for these expenses. While many are reluctant to turn to this source for support, this assistance is available for exactly the sort of need that arises through no fault of the injured worker. Mass Health may be available to meet the medical expenses if one does not have health insurance.
Regardless of the form, private insurance, or public assistance, an injured worker who turns to these sources while fighting for worker’s compensation benefits must recognize that payments often result in a lien against their worker’s compensation claim. A lien is best described as a loan that must be repaid only if the worker’s compensation is ultimately awarded.
Health insurers, including Mass Health, which pay for treatment-associated for what is found to be a work-related injury, have a lien against the claim. This lien is satisfied and then discharged when the worker’s compensation carrier reimburses the health insurer for its payments. Payments for public assistance likewise must be repaid from the proceeds of the worker’s compensation award or lump sum settlement.
Lien holders may be willing to negotiate liens in circumstances where recovery under worker’s compensation is difficult or a claim may be denied. While a lien holder’s right to recovery must be satisfied first, if the injured worker takes little or nothing from a settlement and if the lien holder is repaid in full, then the injured worker has no incentive to settle. Lien holders recognize the risk of demanding too large a portion of a settlement and many prefer to compromise a lien rather than risking that they, like the injured workers, might get nothing if they force a tenuous case to a hearing decision.
If a lien holder takes an unreasonable position with respect to repayment, an injured worker may have recourse before the Department of Industrial Accidents under Section 46A of the Worker’s Compensation Act. The Department has authority in certain circumstances to evaluate and exert influence over the amount of the lien which must be repaid. The most important thing to bear in mind is that a lien does not create an absolute obligation to be repaid. Injured workers ultimately control whether a lien is to be repaid and in what amount as the decision to settle a claim or try a case to a hearing decision is the injured worker’s decision and no one else’s.
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