Personal Injury Lawyer:”There are two primary types of injury claims: Workers’ Compensation and a Third Party or Negligence claim.”
There are two primary types of injury claims: Workers’ Compensation and a Third Party or Negligence claim. Negligence claims may include car accidents, slip and falls, and medical malpractice claims. “Negligence” is defined as failing to exercise the appropriate degree of care that an ordinary person would exercise in the same circumstances. The evidence needed to satisfy one’s burden of proof is extremely different in each claim. Additionally, there are multiple parts to each different claim; generally, there is (1) liability and (2) damages.
In Workers’ Compensation, to prove liability it is only necessary to present evidence (that the Judge accepts and believes) to show that the injury occurred in the “course and scope” of a person’s employment. It does not matter whether either party was negligent – and proof of negligence does not increase the award. In a Third Party claim, “negligence” is an essential element that must be proven, and the injury must be a direct result of the failure to take such care. An award may be reduced if the injured person was also negligent, based on the percentage of each person’s negligence in causing the injury. The proper degree of care required, and the percentage of each person’s negligence is determined by the Judge or jury.
As far as “damages”, in workers compensation, the award is limited to the wages the injured worker loses as a direct result of their work injury – so long as that lost income is a direct result of their injury; and payment of medical bills for treatment of the work-related injury*. Each of these aspects are calculated pursuant to the terms of the WC Act. There is a rate table which dictates how much wage loss a person receives, up to a maximum rate for each given year. Most people fall in the bracket paying them 2/3 of the average weekly wage. These wage loss benefits, also called indemnity benefits, are available for as long as the claimant is “legally” classified as totally disabled. There are numerous tactics the insurance company can use to change the injured worker’s classification to partially disabled, which limits the claimant to 500 weeks of benefits. The rate of benefits may or may not change, depending upon the specific strategy used, and the evidence presented (and believed by the Judge). Payment of medical bills is limited to treatment that is “reasonable, necessary and related” to the work injury. Again, the insurance company may challenge whether any or all of these criteria apply. The bills are paid pursuant to a schedule based on the treatment code, not based on what the medical provider bills. A medical provider may not bill the injured worker for a higher amount than permitted by the Act.
In a negligence claim, the plaintiff may recover economic damages, such as lost wages, cost for property repair and other “out-of-pocket” costs due to the incident; and medical bills not covered by “other” insurance. By way of example, in a car accident case, medical bills are paid by the injured person’s OWN policy, and then by the person’s OWN private insurance. Any bills not paid are excess, and considered as part of the economic damages. The plaintiff may also recover money for pain and suffering – which is not available in a workers compensation case. In a negligence case, these economic damages (lost wages and medical bills) are not set out in a table like in a workers compensation case. The plaintiff must present evidence (which the Judge or jury believes) to establish past, present and future loss. Therefore, it is necessary to have a medical expert evaluate the need and cost of future treatment; and a vocational expert and/or an economist determine the projected future loss of income. Bills for these experts are not “treatment”. These are costs of litigation, necessary to have the evidence to prove the case. In some cases, such as medical malpractice, even more experts may be required to prove the defendant doctor was negligent.
Reimbursement of “litigation costs” is also different in Workers’ Compensation and negligent claims. Typically, attorneys handling each of these types of cases do so on a contingent fee basis – meaning they only get paid a fee for their services if they win the case. Practices vary as to whether they include the cost necessary to fight the case on a contingent basis – or demand such payment from the client – win or lose.
In workers compensation, the fee and costs MUST be approved by the Judge. Then, the insurance company will pay the attorney directly, by deducting the fee from the client’s share, and paying the attorney and the claimant their respective amounts directly. Litigation costs are NOT deducted from the client’s award – but (if approved by the Judge) must be paid by the insurance company directly to the attorney.
In a negligence case, the full amount of any settlement or award are paid in one lump sum to the attorney. It must be placed in a special account, called IOLTA – and then is distributed by the attorney. There should be a distribution summary, showing the client where every single penny of the award goes: attorney’s fee, attorney’s costs; outstanding medical bills; lawsuit loans or other liens against the award; and the client’s net recovery.
There are also significant difference between the timing and manner of pursuing a Workers’ Compensation case and a personal injury case – but that is a whole topic in itself.