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March 17, 2017

Don’t Miss the Crossover Issues in WC

Summary:

Crossover issues are not strictly workers' compensation issues -- which is why they are sometimes overlooked. That omission can be costly.

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March Madness may be the ideal time to remember workers’ compensation crossover issues. Crossover issues are not strictly workers’ compensation issues — which is why they are sometimes overlooked. That omission can cost a party money or even lead to a professional malpractice suit.

Third-Party Claims

Product liability, medical malpractice and negligent roadway design are examples of third-party claims usually unaffected by the exclusive remedy rule. Collisions may give rise to the most common third-party claim.

See also: How Should Workers’ Compensation Evolve?  

SSDI

Whether and when to apply for Social Security Disability Income (SSDI) are not simple decisions. Federal law is written to make sure a disabled person does not earn more when not working than the person did on the job. The “80% rule” limits the combined total of SSDI and indemnity payments to an injured worker. This rule principally affects lower-wage earners.

Medicare/Medi-Cal

Virtually all workers’ compensation professionals recognize the need for a Medicare Set-Aside in appropriate cases. Correct self-administration remains a challenge. Additionally, practitioners should be aware that two forms of Medi-Cal currently exist: traditional and expanded. Savvy negotiators can often use these programs to create a safety net to cover the injured worker’s medical expenses as part of a Compromise & Release completely closing the claim. C&Rs drafted without considering Medi-Cal issues could imperil medical care for the injured worker and the injured worker’s entire family.

Immigration

Undocumented injured workers are eligible for workers’ compensation benefits in California. Some undocumented workers have been in their jobs for decades. They remain under the legal radar until a workplace injury occurs. At that point, a false or stolen identity may come to light, creating issues for the injured worker and the employer. The Patriot Act’s provisions about identification required to open a bank account or to send money out of the country can interfere with an injured worker’s decision to choose a Compromise & Release.

Tax

The tax code provides that money received on account of a physical injury is not taxable. Usually all payments made on a workers’ compensation claim arise from a physical injury. However, a number of circumstances could trigger taxation. Also, once an injured worker receives a buy-out, earnings on invested or banked sums are taxable.

See also: Five Workers’ Compensation Myths  

Get Help

Workers’ compensation professionals should recognize crossover issues, and counsel should alert clients when these issues appear. The next step could be to bring in an expert in that area, provide one or more referrals or advise clients to seek professional advice on their own.

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About the Author

Teddy Snyder mediates workers’ compensation cases throughout California through WCMediator.com. An attorney since 1977, she has concentrated on claim settlement for more than 19 years. Her motto is, “Stop fooling around and just settle the case.”

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