What is a Section 32 Waiver?
In the realm of Workers’ Compensation, employees receive compensation for lost income and lifelong medical treatment resulting from illness or injury. However, there’s an option to permanently close your claim through a Section 32 Waiver, settling for a one-time or yearly payment in agreement with the insurance company.
Opting for this means you forfeit any future compensation for an immediate payout. Let’s delve into how a Section 32 Waiver impacts your existing lost income and medical care. It provides the flexibility to resolve one aspect while keeping another claim open, allowing you to receive ongoing benefits or conclude your case, depending on mutual decisions between you and the insurer.
What parts of your claim can you completely close?
You have the choice to accept a lump sum or annual payment to cover future lost wages, a figure determined through negotiation involving you, your attorney, and the insurance provider. Importantly, these Workers’ Compensation claims are tax-free. Keep in mind that accepting this offer concludes any future claims for lost wages due to illness or injury, and the insurance won’t cover subsequent medical care expenses.
If your injury necessitates future medical care, allocating some of your payment into a separate account may be necessary. To address Medicare’s interests, you might need to create a Medicare Set-Aside account (MSA) with funds from your Section 32 Waiver settlement to cover future medical expenses related to Workers’ Compensation.
Failing to consider Medicare’s interests during settlement might result in Medicare refusing to cover your Workers’ Compensation injury treatment. It’s crucial to consult with Medicare to fully understand your rights and responsibilities, as the Workers’ Compensation Board has no authority over Medicare, being a federal program.
What happens if I exhaust all the settlement funds?
If you deplete your settlement funds, including those from an MSA for future medical expenses, you might need to rely on Medicare or cover costs out-of-pocket. Medicare eligibility hinges on specific criteria like age, social security, and disability insurance, and regular health insurance won’t cover work-related illness or injury expenses.
However, you and the insurance company can choose to keep the medical part of your case open. This means the insurer continues to cover medical treatment. The resolution of the claim involves discussions between your lawyer and the insurance provider, or if you don’t have legal representation, negotiations with the insurer directly.
Without a lawyer, you can negotiate terms with the insurance company and their legal representative, usually resulting in a mutually agreed-upon settlement. Agreement terms need approval from the Workers’ Compensation Board, which will review and, if all parties agree, approve your Section 32 Waiver Agreement, making it legally binding.
The Board provides a ten-day window, starting from the submission date, for you to withdraw the agreement, assuming there’s no Section 32 hearing. If a hearing is required, the submission date serves as the hearing date. If the judge approves the agreement, and no party withdraws during this period, the Board sends a final Section 32 decision and a Notice of Approval.
The insurance carrier must make payment within ten days of the final decision. If a hearing isn’t necessary but the Board approves the agreement, you’ll receive a Proposed Notice of Approval, specifying the submission date. You have ten days from this date to withdraw in writing. The notice also mentions the date the agreement becomes final.
The Workers’ Compensation Board is legally obligated to check for child support liens, and any settlement disbursement will first go toward these liens, with the balance reaching you. If you have legal representation, their fee is deducted from your settlement.
Choosing to settle your wages means closing the claim in exchange for payment, effectively relinquishing any rights to future benefits. Proper planning for medical care and strategic management of your settlement are crucial for supplementing future lost wages.
Ultimately, the decision to accept a Section 32 Waiver agreement rests entirely with you.
For further details, refer to your state’s Workers’ Compensation Board website or consult a Workers’ Compensation attorney.