While there are many reasons that bring potential clients to my office, none is more troubling or pressing than a client whose case is being denied by an insurance company. Once a Claim has been filed with the Division of Workers’ Compensation, the insurance carrier has 20 days to take a position on the claim. Practically speaking, this is a binary decision as the insurance carrier can do one of two things: File a General Admission of Liability or File a Notice of Contest.
It is not uncommon for an insurance carrier to approach their 20-day deadline without all the information that they need to make an informed decision. It is also possible that during their investigation, they uncover facts or pieces of evidence that either contradicts one another or simply doesn’t fit the whole story surrounding the incident. In either case, it is likely for the insurance carrier to file a Notice of Contest, thus denying your claim. Once your claim has been denied, there are typically three options that you will have as an injured worker.
Option 1: Do Nothing. While this might not sound like a great option, it is an option nonetheless. Also, while an insurance carrier will certainly not pay any monetary benefits and would likely deny any serious medical benefits, such as a surgery, they will often pay for basic medical treatment even on a denied claim. This can actually be very useful to the injured worker because the diagnostic tests that are done early in a case can be very important both for determining your potential medical needs and the value of the case. Doing nothing might not be the best long term solution, but often a little patience at the beginning of a claim can help your decision-making process down the road.
Option 2: Litigate. If your case is denied, and you want the decision reversed, you have the right to take your case heard by an administrative law judge to make a new decision on your claim. While this might seem like the most obvious way to handle a denial, it is not without its problems, which can generally be broken down into Time, Money, and Uncertainty.
First, the law says hearings are to be set within 120-180 days, which is approximately 4-6 months. Judges have been known to take upwards of a year to issue a decision on a case once the hearing has occurred, which could lead to total litigation time lasting well over a year. Second, there is always uncertainty associated with going to court, and the reality is that the judge you get assigned on the day of your hearing matters. There are judges in our system that rule for the injured worker approximately 15% of the time, and others that rule for the worker approximately 60% of the time, and everything in between. The injured worker also generally assumes the burden of proof in this system, which always makes for an uphill fight. Third, in this system, the biggest disputes often revolve around medical treatment, which usually requires expert testimony. If you need a doctor to offer a medical opinion for a hearing, it will cost money. Our average costs associated with litigation are typically between one and three thousand dollars in the work comp system.
Option 3: Settle. The settlement is probably the most common resolution that we see when a claim has been denied. This involves both parties agreeing to a set amount of money in exchange for giving up a future right to compensation the worker might have under this system. Sometimes, insurance companies offer enough for this to make sense, and other times they simply do not. Settlement requires an agreement from both parties, which often is the product of extensive negotiation and compromise. In other words, the perfect settlement typically involves the carrier paying more than they want, and the worker perhaps taking a bit less than they want.
Ultimately, it is impossible to fit all denied cases into one bucket. Some cases need to be litigated, and others make more sense to settle. The best results generally come from keeping multiple options open and doing your best to be objective in the decision-making process.