Detailed Answer
When you receive both workers’ compensation benefits and damages from a personal injury settlement in Missouri, you must coordinate those benefits to address the insurer’s right to reimbursement. Under Missouri law, a workers’ compensation carrier may seek repayment of medical and indemnity benefits paid if you later obtain a third-party recovery. This process is known as subrogation or statutory reimbursement.
1. Statutory Basis for Reimbursement
- Mo. Rev. Stat. § 287.120 grants the compensation carrier a right to be reimbursed from your third-party recovery for benefits paid on your behalf. See § 287.120.
- Mo. Rev. Stat. § 287.130 establishes the insurer’s lien against any recovery you obtain from a negligent third party. See § 287.130.
2. Settlement Structure and Allocation
To minimize the reimbursement obligation, negotiate a settlement that allocates damages among categories:
- Medical expenses: Amounts you owe to health care providers already covered by workers’ comp.
- Lost wages/indemnity: Portion compensating for time out of work—these are fully reimbursable to the carrier.
- Pain and suffering: Non-economic damages not subject to reimbursement under Missouri law.
By clearly allocating a portion of the settlement to pain and suffering, you preserve that amount for yourself and reduce the carrier’s recovery.
3. Notice and Approval
- Notify your workers’ compensation insurer in writing when you file a third-party claim.
- Obtain a written statement of lien from the insurer, detailing benefits paid and anticipated subrogation amount.
- Submit your proposed settlement allocation for the insurer’s review and request a waiver or release of any disputed amounts.
4. Court Approval or Stipulation
In some cases, parties may seek court approval of the settlement to resolve any dispute about the carrier’s lien. The court can confirm the appropriate subrogation amount and ensure proper distribution.
Helpful Hints
- Keep clear records of all workers’ compensation payments (medical, indemnity, mileage).
- Work with your personal injury attorney to draft precise allocation language in the settlement agreement.
- Request a detailed lien letter early to avoid delays in closing your third-party case.
- Consider mediation with the carrier if you disagree about the reimbursement amount.
- Confirm that releases signed after settlement do not inadvertently waive your non-reimbursable damages.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult a qualified attorney to discuss your specific situation.