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Navigating Workers’ Compensation Liens: Protecting Your Rights and Maximizing Recovery
According to the Missouri labor department, there were 91,688 workplace injuries in 2022. Of that total, 108 were fatal. Injured workers can file a workers’ compensation claim with the employer’s workers’ compensation insurer. However, if the workers’ compensation insurer later determines the injury was not due to the employer’s negligence, they may advise the injured employee to file a personal injury lawsuit against the negligent third-party.
If a third party was at fault, the injured employee can hire separate counsel to file a personal injury case. In turn, your employer’s insurance company may seek to recover the workers’ compensation benefits paid by asserting a lien against the third-party settlement.
Several considerations and procedural intricacies come into play when negotiating workers’ compensation liens. With so much at stake, consider retaining trusted workers’ comp lawyers to protect your rights and maximize your recovery.
What Is a Workers’ Compensation Lien?
A workers’ compensation lien is a form of security interest. The employer’s workers’ compensation insurance provider places a lien to protect their right to reimbursement for amounts paid to an injured worker from a personal injury claim. This lien gives the insurance company a legal interest in the recovery arising from the injury claim.
How Do Workers’ Compensation Liens Work?
In Missouri, workers’ compensation and the Ruediger Formula go hand in hand. The formula dictates the exact amount an employer gets from a third party. According to the Ruediger Formula, the amount of the lien should be less than the attorney fees, court costs, and any additional expenses incurred as part of the personal injury claim.
In essence, the Ruediger Formula allows the insurance company to recover what they paid while allowing the plaintiff to receive a fair and just settlement. It helps ensure both parties receive fair treatment and that the underwriter can recover the amount paid.
Due to the complexity and nuances associated with workers’ compensation liens, seek legal counsel before you start a workers’ comp claim in Missouri.
Workers’ Compensation Lien Resolution Process
Workers’ compensation lien resolution involves negotiating with the employer’s insurance company to reduce or eliminate the lien asserted against a personal injury settlement. The steps taken in the process are as follows:
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Negotiation. Negotiating a workers’ compensation lien can be challenging. The injured worker should understand the lien process and their legal options. Consult your lawyer for insight on applicable workers’ compensation laws in Missouri.
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Mediation is an alternative dispute resolution (ADR) process where a neutral party helps the parties reach an agreement. Mediation can be beneficial to both parties since it allows them to be in control of the dispute’s outcome. Parties will reach a mutually beneficial arrangement that addresses their needs and interests.
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Litigation means you resolve your dispute through a court of law. The litigation comes in when mediation and negotiation fail. Before proceeding, you must understand Missouri’s applicable laws and procedures. Consult a qualified attorney with experience litigating workers’ comp cases to increase your chances.
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Settlement. This option is available when you want to avoid the stress of a trial. Settlements are efficient and cost-effective dispute resolution strategies. You or your attorney can negotiate a settlement.
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Arbitration. It is a form of ADR where a neutral third party hears and decides a dispute. You’ll control the outcome and avoid the tedious Missouri court process.
Negotiating the Lien Amount
The workers’ comp insurer can request reimbursement for medical expenses, rehabilitation costs, and lost wages paid to the injured worker. The insurer may be willing to reduce the lien amount to incentivize the worker to file a third-party lawsuit, as the lien amount should not exceed the face value of the personal injury claim. The insurer understands that if the lien amount is too high, the worker will not have the incentive to pursue a third-party suit and will be reimbursed regardless. Therefore, negotiation of the lien amount may be beneficial for both the insurer and the worker.
Your workers’ compensation lawyer should make every effort to come to a compromise with the insurer regarding the amount of the lien. The amount you receive from your injury claim should be substantially higher than what the insurance covers.
How Do I File a Lien for Workers’ Compensation?
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Step 1: Gather the necessary documents related to your case. These may include medical reports, proof of lost wages, and other documents supporting your claim.
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Step 2: Contact your state’s workers’ compensation board to obtain the necessary forms and instructions for filing a lien.
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Step 3: Complete the lien forms and submit them to the workers’ compensation board. Include any supporting documentation.
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Step 4: Submit the lien to the workers’ compensation board for review and determination of validity.
How Do I Make a Counteroffer on a Workers’ Comp Settlement?
Making a counteroffer on a workers’ compensation settlement can be a strategic way to negotiate for a better outcome, but it requires careful consideration of the following factors:
- Calculate the values of your claim. Consider your medical expenses, lost wages, and other damages related to your injury.
- Determine a reasonable settlement amount. Consider the insurance company’s initial offer and make it your starting point. Ensure you factor in any legal fees, court costs, and other expenses associated with your claim.
- Present a counteroffer. Present a realistic and fair counteroffer to your insurance cover provider. Include detailed explanations of why you believe it should hold.
- Respond to the insurance company’s response. The insurance company may respond with their counteroffer after you present yours. Consider it carefully and respond accordingly.
- Negotiate. Be ready to negotiate with the insurance company until you reach an amicable solution.
How a Missouri Personal Injury Lawyer Can Help You with a Workers Compensation Lien
A lawyer can help you evaluate the amount of the lien and advise you on the best course of action. They can also assist with negotiating a lien, filing any necessary paperwork, and representing you in court. An experienced personal injury lawyer can also provide valuable advice and assistance throughout the Missouri workers’ compensation legal process. Ultimately, the goal is to ensure that you receive compensation for your injuries and your rights are protected.
Buchanan, Williams & O’Brien are lawyers experienced in workers’ compensation and personal injury law. Schedule a free evaluation today.
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