Nassau County Workers Compensation Lawyer: Newsday Reports on Permanent Partial Disability Lump Sum SettlementsTuesday, April 8, 2008
There are literally thousands of former Nassau County workers who are currently receiving lifetime workers’ compensation payments (pensions) for life due to on- the- job injuries. I know – I have represented a large number of these unfortunate individuals. These payments are overwhelmingly for workers who have been classified as having "permanent partial disabilities" and are destined to live the rest of their life in pain.
According to a Newsday article yesterday, Nassau County is now proposing a $55 million taxpayer funded bond to "sell" these claims to private insurers who would then try to convince the injured worker to settle the claim in a one-time "buy-out". Is this good for the injured former Nassau workers? For many of them, it is not a good deal at all unless they are paid "full value" for their settlement. It also may not be a good deal for the taxpayer. (See the excellent WorkersComp Insider post here) .
Our office recently negotiated a lump sum buy-out (often times called a Section 32 settlement) for a Nassau municipal worker for $650,000.00. We thought this was a fair settlement given that the worker was going to lose both weekly non-taxable cash benefits and medical care for the rest of his life. Unfortunately, you can bet that the insurance companies "bidding" for the Nassau County claims have no intention of paying fair settlement value to former Nassau employees.
The vast majority of lump sum buy-out offers are grossly unfair to the injured worker and are simply a device for insurance companies to dump claims and invest the excess profits. The claimant needs a skilled NY workers compensation lawyer to negotiate a fair settlement. So what is amount fair? First and foremost, for anyone who is likely to need major medical intervention in the near future, such as surgery, no amount of money may be the answer. Remember, once the injured worker accepts the cash buy-out, he must pay for future medical care, including surgery, on his own. Any settlement offer in a case like this would have to also "buy-out" the potential future cost of surgery, medications, physical therapy, etc.
Anyone considering a buy-out of a permanent partial disability claim should ask their workers compensation lawyer to do a "present value calculation" of what their future cash AND medical benefits are worth. This present value calculation, which is the standard for settling long term disability claims, can be drastically impacted by current interest rates. For instance, today I am using an interest rate tied to the ten year treasury bill rate (3.58% as of 4/08/08) to determine present value for the purposes of settling my cases. When interest rates go back up, present value settlement offers will go down, so historically, now is a good time to get maximum value when deciding to settle a New York workers’ compensation claim. In addition, if you receive Social Security Disability in New York, you may need a Medicare Set-Aside agreement.
There are many present value calculators on the Internet which can help you determine a fair settlement proposal. As my third grade math teacher instructed, I like to show my client’s the "work", not just the answer, which I do on a Microsoft Excel spreadsheet. Of course, settlement of any workers compensation claim is as much "art" as arithmetic, but the math is always the starting point.
It remains to be seen whether Nassau County dumps its old workers’ compensation claims in the hands Warren Buffet and Berkshire Hathaway to settle with permanently disabled workers. If it does and you are an injured worker approached for a buy-out of your claim, ask a lot of questions of your Nassau workers compensation lawyer. You don’t want to leave any money on the table, and Warren Buffet has enough money.