Q: Can a workers' compensation claim be fully settled or closed in Iowa?
A: Yes, in Iowa, settlements and lump sum payments of future benefits are subject to approval by the Iowa Workers Compensation Commissioner, and each has its specific requirements.
The law provides for two general types of settlement.
First, the parties may enter into an agreement as to the amount and extent of compensation payments due. The approval of an agreement for settlement does not necessarily end the employee's future rights. A lump sum payment of all, or part, of remaining future benefits may be obtained. When all future benefits are paid, all of the employee's future rights to additional benefits, including medical benefits, will end, fully closing the claim.
Second, when there is a dispute as to whether or not the employee is entitled to benefits, a Compromise Settlement may be reached. Approval of a Special Case Settlement ends the employee's future rights to any benefits, weekly and medical, for the settled injury, condition or disease, thus fully and finally settling the claim.
Note that a claim does not need to be in litigation to be settled by any of these methods, and that resolving disputes early and, without litigation, which is often lengthy and expensive, is often to the benefit of all involved. Also, should you wish to resolve other potential claims, this can often be done, although, the employer, may have to contribute additional money to the settlement, as these side agreements, may not be covered by workers' compensation, or general liability, insurance.
You should consult an attorney before discussing any settlement.
Q: What happens to future medical when a lump sum settlement is reached?
A: Under Iowa's Workers' Compensation Laws, there are four specific types of settlement. The first type, known as a Compromise Settlement pursuant to §85.35(3) of the Iowa Code, provides the amount of money received at the time of settlement is the last money an employee will ever receive as a result of this injury.
The second type of settlement, called an Agreement for Settlement pursuant to §85.35(2) and §86.13 of the Iowa Code, leaves future medical open. This entitles the employee, should subsequent medical treatment ever be needed as the result of this injury, to have those medical expenses paid for by the employer. Also, the employee may reopen this settlement within 3 years of the last payment of weekly benefits under Iowa law should there be a significant change in the employee's circumstances creating an increased disability.
The third type of settlement, called a Full Commutation pursuant to §85.45 & .47 of the Iowa Code, is based on an Agreement for Settlement as to what is owed, however, closes out all future payments similar to the Special Case Settlement discussed above. However, the future benefits must be ascertainable and substantial. The employer pays all the future benefits in one lump sum at a discount.
The fourth type of settlement, called a Partial Commutation pursuant to §85.48 of the Iowa Code, which is likewise based on an underlying Agreement for Settlement as to what is owed, however, it allows for the payment of a part of the future benefits in a lump sum. It also gives the employee the opportunity to reopen this settlement within 3 years from the date of last payment of weekly benefits and leaves intact the right to lifetime medical benefits.
Various combinations of types of settlement, as well as settlements contingent on approval by a Court or governmental agency are also possible.
As currently interpreted by the Agency, the type of settlement used for injuries occurring on or after September 7, 2004, may also affect rights to partial satisfaction of permanent partial disability on other claims for injuries occurring on or after September 7, 2004.
You should consult an attorney before discussing any settlement. (top)
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