Should You Hire a Structured Broker or a Settlement Planner?

Securing the best future for the client is always a priority for an attorney in a personal injury case. Depending on the amount, it may be in the client’s best interest to have a structured settlement annuity instead of a lump sum payment. A structured annuity often works in your client’s favor because it is difficult for clients to budget their own expenses over time when other expenses come up. Working with a structured settlement broker (structured broker) or settlement planner can help you provide the best service and settlement for your client and their future needs.

Both structured brokers and settlement planners are experienced professionals with skills that can help you give your client a smoother experience during a potentially difficult time in their life.

Structured Broker

A structured broker has experience arranging structured settlements for clients. Before your client’s settlement agreement is finalized, the decision to structure must be made. The structured settlement broker will secure the settlement through a third party, often an insurance company that purchases the structured settlement annuity. The broker can also walk you through the tax implications and best options for your client.

Something to be aware of is that the claimants may hire their own structured broker who will not have your client’s best interests in mind. It’s best to work with someone you choose so your client isn’t stuck with the defense’s choice.

Settlement Planner

Settlement planners can help early on in the case so attorneys can focus on building a case and supporting their clients. They will take into account the treatment plan, outstanding liens, bankruptcy concerns, and potential assistance from government programs, before making a recommendation for a settlement strategy that will best fit the client. As an additional advocate for your client, a settlement planner can maximize the settlement.

It may be that a structured settlement is not the best option for the client, in that case, the settlement planner can make a recommendation like a special needs trust or a pooled trust. The settlement planner will clearly detail their options, saving you time and allowing you to focus on other important tasks for the settlement.

Experience Counts

Choosing the right structured broker or settlement planner can save you time and give your client the best experience possible. Most trial attorneys aren’t experienced in arranging structured settlement annuities, having an experienced settlement professional involved in the case can reduce liability.

A structured settlement broker or settlement planner can arrange structured settlement annuities for large sums or smaller settlements. Synergy Settlement Services has worked on a number of cases of greatly varying values, some of which have been around $15,000.

For more information about setting up a structured annuity or to schedule a consultation, please submit our contact request form.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.

Types of Annuity Payments

When your client is awarded a settlement, an annuity can be utilized to parse out payments and ensure that funds are being distributed sensibly. After working tirelessly to build your client’s case so that they receive a fair settlement, you want to guarantee that their settlement retains its value for years to come. An annuity, which is typically a contract between a plaintiff and an insurer, disseminates payments in regular intervals to provide a stream of income for years to come.

There are many types of annuities including fixed, fixed index, variable and indexed, but fixed and fixed index are the most commonly used types of annuities for structured settlements. Understanding the differences between these types of annuities is integral to maximizing your client’s settlement. A settlement planner can partner with an attorney to help their client benefit from a tax-free annuity.

The Two Phases Annuitization

An annuity is a product of financial institutions that have the resources to manage payouts and improve the value of a settlement. A structured settlement through an annuity can offer a much greater value than a lump-sum payment. Plaintiffs who work with a settlement planner will invest funds into an annuity with the intention of receiving payments later on.

There are two phases of an annuity, the accumulation phase and the annuitization phase. During the accumulation phase, the annuity is funded and prepared for future payouts. Once your client begins to receive payments, the contract has officially entered the annuitization phase.

Common Types of Annuity Payments for Structured Settlements

As we mentioned above, the purpose of an annuity is to exchange a lump sum payment (or settlement) for a series of disbursements that help the plaintiff maximize the value of their settlement. Annuities can be used to help cover specific financial needs including principal protection, lifetime income, legacy planning, or the cost of long-term health care.

For personal injury plaintiffs, a tax-free annuity can be acquired under 104(a) of the IRS codes, which establishes that all personal injuries cases are exempt from federal and state income taxes.

Annuity payments can begin immediately following the receival of the settlement or at a specified date in the future. Some types of annuity payments include:

Fixed Annuity: provides the settlement recipient with regular, secure payments every month. A settlement planner can help determine the level of funding needed on a monthly basis to cover the recipient’s bills and living expenses.

Fixed Index Annuity: unlike a fixed annuity, a fixed index annuity readjusts according to market conditions. Typically, this type of annuity is utilized by recipients hoping to turn their annuity into an investment. Recipients can take advantage of a healthy market, and since this type of annuity is still “fixed” there’s no downside if the market takes a dive.

When you work with a settlement planner from Synergy Settlement Services, your personal injury client can take advantage of a tax-free settlement by receiving payments through a tax-free annuity.

For more information about how you can benefit from a tax-free settlement or to schedule a consultation, please submit our contact request form.

How to Tell if Your Client Needs a Liability MSA (LMSA)

In a personal injury case, Medicare set aside (MSA) arrangements can be confusing for both the plaintiff and the plaintiff’s attorney. Most personal injury attorneys don’t have the experience to coordinate MSA arrangements for their clients. A lack of experience and knowledge can lead to liability for the trial attorney involved in the case.

The Centers for Medicare and Medicaid Services (CMS) has not set any guidelines, regulations, or statutes defining the requirement for liability set-asides. However, Medicare is a secondary payer, as mandated by Federal law, and if any other insurer is available, Medicare will not pay the bills for a personal injury. Once the insurer becomes unavailable, Medicare will start to pay for medical costs. The CMS reviews LMSAs on a case-by-case basis, depending on the claim, the region’s bandwidth, and its leadership.

Does Your Client Need an MSA?

Considerations for a liability MSA need to begin as soon as the personal injury case starts. However, it’s difficult to decipher CMS communications regarding LMSAs. There are harsh consequences for clients whose attorneys do not make the right decisions for their needs. It could even lead to those clients not being able to access Medicare benefits later.

Even though there are no straightforward guidelines for liability MSAs there are some fundamental questions you can ask yourself to see if an MSA may be in your client’s best interest:

Is your client eligible for Medicare benefits?
Will your client need care in the future related to the accident?
Does the case cover future medical payments?

If you can answer “yes” to all these questions, it’s time to consider an MSA for your client.

It’s important to document the case, especially when an MSA may be involved, including obtaining copies of your client’s insurance cards. Being upfront with your client about the reality of setting up an MSA can help manage their expectations of what will happen with the settlement after the trial.

Consulting with a knowledgeable settlement planner can take a noticeable weight off your shoulders. They are used to wading through the communications and updates of CMS and keeping clients’ best interests in view.

For more information about how to set up a Medicare set aside or to schedule a consultation, please submit our contact request form.

Lien Existence & Ethics, Redefined

Some of the most frustrating and murky issues facing attorneys representing injured clients stem from alleged “liens” against settlement proceeds. The Florida Bar’s position on these issues, and the limited laws delineating them, have been ever-shifting and evolving.

Ethical Obligation to Protect Liens

One constant in this otherwise uncertain area, is this: Attorneys representing injured Plaintiffs in personal injury actions have an ethical responsibility to use all reasonable efforts to resolve disputes between clients and known third-party lienholders.

Injury attorneys cannot unilaterally arbitrate such disputes. If a dispute cannot be resolved through negotiation, “the lawyer should consider the possibility of depositing the property or funds in dispute into the registry of the applicable court so that the matter may be adjudicated.” Comment to Rule 5-1.2, Rules Regulating the Florida Bar. The Ethics Committee has stated that an injury attorney should “endeavor to assist his client and the physician in effecting a compromise.” Opinion 67-36, Professional Ethics of the Florida Bar. If such efforts fail, “the lawyer should institute an interpleader action in a court of competent jurisdiction naming his client and the physician as defendants.” Id., emphasis added.

In 2004, issues involving “Letters of Protection” were specifically addressed in Opinion 02-4. The Ethics Committee again reiterated its position that a lawyer “cannot take it upon himself or herself to decide who is entitled to what.” Id. The Committee also reiterated that a lawyer holding disputed funds “should institute an interpleader action.” Id. (citing Opinion 67-36 and Rule 5-1.2). However, an interpleader action is not “the only alternative.” Opinion 02-4. Other options include, but are not limited to, seeking declaratory relief under Fla. Stat. § 86.021 and/or Fla. Stat. § 501.211(1), Florida’s Deceptive and Unfair Trade Practices Act (FDUTPA).

A Wild Ride, from Pintaluga to Staff Opinion 38866

The Florida Bar Ethics Counsel should clarify, once and for all and by written ethics opinion, the Bar’s final position on an attorney’s ethical responsibilities regarding the protection of third-party interests in settlement proceeds. Thus far they have not done so, despite their position seeming to swing radically in recent years.

While advice from the Ethics Hotline is helpful, it is not in writing and cannot be relied upon to definitively protect you. Similarly, even written staff opinions are “advisory” and as such, “are intended to provide guidance to the inquiring attorney and are not binding; the advisory opinion process is not designed to be a substitute for a judge’s decision or the decision of a grievance committee.” Staff Opinion 38866. Only a published ethics opinion can settle the issues surrounding lien rights and the ethical responsibilities flowing therefrom. That said, reports of advice from the Ethics Hotline and staff opinions have been the only guidance on lien issues, since Opinion 67-36 and Opinion 02-4, and form the only basis from which we may attempt to guess the Bar’s position.

For roughly five years (from sometime after August 2013 until August 2018) the Bar’s position on the protection of injury-related medical bills appears to have swung wildly. Starting sometime in 2013, the Bar incorrectly interpreted the Supreme Court’s Consent Judgment in Florida Bar v. Pintaluga (Case No. SC13-1021) to mean all known accident-related medical bills must be protected in trust, whether the provider holds a lien or not. This position was unfounded in law, nor in fact, for several reasons.[1] Most importantly, Pintaluga was not factually square with that issue. In Pintaluga, there was a lien, created by a letter of protection (LOP) signed by the client (the only issue was whether the lien was valid if not also signed by the attorney). Not surprisingly, the lien was held to be valid because it was signed by the client and the attorney was aware of it. Further, the Bar’s entirely novel position that all injury-related bills must be protected regardless of whether liens existed, flew directly in the face of the well-settled Ethics Opinions discussed above, and the robust body of case law delineating hospitals’ rights when they do, and do not, have liens (including the two Supreme Court opinions discussed below).

In August of 2018, Staff Opinion 38866 corrected this misplaced position and clarified that “[i]f the providers have valid legal claims to the funds held in trust” the funds must be protected, but “if third parties do not have valid claims to the funds, the lawyer should disburse the funds to the rightful owner.” The key words being “to the funds.” The converse, just having a legal claim AGAINST THE PLAINTIFF (i.e., being a mere creditor, having a mere “debt”) does not satisfy this definition, and never has. Third parties must evince legal claims TO THE SETTLEMENT PROCEEDS. Stated differently, there must be a “lien” for an attorney to withhold money in trust against the client’s wishes. Simply put, you must protect “liens” but not “debts.” The litmus test is evidence of some statutory, ordinal or contractual lien. Without it, “the lawyer should disburse the funds to the rightful owner”–i.e., to the plaintiff (upon demand). Arguably, an attorney not only “may” disburse upon demand, she or he “must” release funds to the client absent a lien.

Hospital Liens

Hospital liens have been the subject of much litigation, some of it very recent. Unlike forty other states (and the District of Columbia),[2] Florida has no statewide lien statute. Instead, some Florida counties have liens, while others do not. This distinction has also been in flux between 2009 and 2018. Most Florida hospital lien laws cover all hospitals in the county, while a minority restrict the lien to “public hospitals” or “charitable hospitals.”

Hospital lien laws which were created by special act are unconstitutional under Article III, § 11 of the Florida Constitution. Of the approximately 22 counties which have hospital lien laws, 13 were created by a special act, and 6 more were created by a combination of a special act and a county ordinance. Because the Florida Constitution states “[t]here shall be no special law or general law of local application pertaining to…creation, enforcement, extension or impairment of liens based on private contracts,” hospital lien laws have been challenged as unconstitutional special acts in three cases.[3]

The 1^st DCA in Mercury v. Shands found “that chapter 88-539 is a special law which creates a lien based on a private contract between Shands and its patient, in violation of article III, section 11(a)(9), of the Florida Constitution.” The Supreme Court reversed the 1^st DCA as to Alachua County, but in doing so articulated a bright line test: liens in counties with county ordinances are constitutional, while liens promulgated ONLY by special act, are not. Accordingly, counties which have enacted lien laws by county ordinance are not be affected by Mercury v. Shands. In 2017, Lee Memorial resisted the Shands decision, arguing its contracts are “public” (not “private”) and as such, the constitutional test articulated in Shands did not apply.

The Second DCA disagreed, upholding the trial court’s determination that Lee’s liens are unconstitutional. Lee Memorial Health Systems appealed to the Supreme Court, which affirmed the Second DCA, stating:

We agree with the trial court and the Second District that the LMHS Lien Law violates article III, section 11(a)(9) as a special law pertaining to the creation, enforcement, extension or impairment of liens based on private contracts.

However, be careful in “non-lien” counties. Many hospitals, including but not limited to Sarasota Memorial Hospital, are creating liens by contract, at admission. This relatively new but inevitable practice of adding “lien language” to admission contracts has the possible effect of creating liens anywhere, regardless of whether a county has a valid lien ordinance.

Conclusion

Attorneys must protect liens by withholding monies in trust, over the wishes of their clients. Liens can be created by statute (though Florida does not have a lien statute), by county ordinance (in the following eight Florida counties which have them), or by contract (usually, an LOP or similar document signed by a patient and/or attorney, or more recently a hospital admission contract). If no lien exists, lawyers arguably not only “may” but “must” release settlement proceeds upon their client’s demand. The Florida counties with valid hospital liens by county ordinance are:

Alachua
Bay
Brevard
Broward
Duval
Hillsborough
Miami Dade
Orange

Unless and until county ordinances are passed in other counties, or a statewide lien statute is passed, injury-related hospitals bills in all other Florida counties are not secured by liens.

[1] This position was evinced only by reports of advice from the Ethics Hotline, instructing attorneys to withhold ALL injury-related bills which were included in a demand package. The position was not, to my knowledge, reduced to writing in a staff opinion or otherwise.

[2] See Ala. Code § 35-11-370; Alaska Stat. § 34.35.450; Ariz. Rev. Stat. Ann. § 33-931; Ark. Code Ann. § 18-46-101; Cal. Civ. Code § 3045.1; Colo. Rev. Stat. Ann. § 38-27-101; Conn. Gen. Stat. Ann. § 49-73; Del. Code Ann. tit. 25, § 4301; D.C. Code § 40-201; Ga. Code Ann. § 44-14-470; Haw. Rev. Stat. § 507-4; Idaho Code Ann. § 45-701; 770 Ill. Comp. Stat. Ann. 23/1; Ind. Code Ann. § 32-33-4-1; Iowa Code Ann. § 582; Kan. Stat. Ann. § 65-406; La. Rev. Stat. Ann. § 9:4751; Me. Rev. Stat. tit. 10, § 3411; Md. Code Ann., Com. Law § 16-601; Mass. Gen. Laws Ann. Ch. 111, § 70a; Minn. Stat. § 514.68; Mo. Ann. Stat. § 430.230; Neb. Rev. Stat. Ann. §§52-401 & 52-402; Nev. Rev. Stat. Ann. § 108.590; N.H. Rev. Stat. Ann. § 448-A:1; N.J. Stat. Ann § 2a:44-35; N.M. Stat. Ann. § 48-8-1; N.Y. Lien Law § 189; N.C. Gen. Stat. Ann. § 44-49; N.D. Cent. Code Ann. § 35-18-01; Okla. Stat. Ann. tit. 42 §§43 & 44; Or. Rev. Stat. Ann. § 87.555; R.I. Gen. Laws Ann.§§9-3-4 to 9-3-8; S.D. Codified Laws § 44-12-1; Tenn. Code Ann. § 29-22-101; Tex. Prop. Code Ann. § 55.001; Utah Code Ann. § 38-7-1; Vt. Stat. Ann. tit. 18, § 2253; Va. Code Ann. § 8.01-66.2; Wash. Rev. Code Ann. § 60.44.010; Wis. Stat. Ann. § 779.80

[3] Palm Springs General Hospital, Inc. Of Hialeah v. State Farm Mutual Automobile Insurance Company, 218 So 2d 793 (Fla. 3d DCA 1969), affirmed, State farm Mutual Automobile Insurance Company v. Palm Springs General Hospital, Inc. Of Hialeah, 232 So. 2d 737 (Fla. 1970); Hospital Board of Directors of Lee County v. McCray, 456 So 2d 936 (Fla. 2d DCA 1984); Mercury Insurance Company of Florida v. Shands Teaching Hospital & Clinics, 21 So. 3d 38 (Fla. 1^st DCA 2009).

The Third Thursday webinar Hospital Liens – Cost Transparency, Friend or Foe?, which aired in February is now available here.

Creating the Best Structured Settlement Plan For Your Client Part 2

In this two-part article, we are discussing the benefits of hiring a settlement planner. When a personal injury plaintiff is awarded a large settlement, they likely are not qualified to manage the funds they received in the settlement. There are many complex nuances in managing a settlement trust and its best to leave the financial planning to a financial expert with experience devising structured settlements. A settlement planner can help maximize a settlement and help your client reach their fiscal goals.

Settlement Planning Offers Long-Term Protection

With a settlement planner overseeing your client’s assets, the plaintiff will be ensured that they have long-term financial protection. One of the greatest benefits of a structured settlement is that the settlement planner can implement a plan for the recipient that suits their financial needs in the present and in the future. The financial expert is able to accomplish this through structured annuities.

Structured Annuities

When the defendant owes the plaintiff compensation after a settlement, the defendant purchases an annuity from an assignment company. This company is then obligated to provide funds to the plaintiff. This process of payment is called an annuity. There are many ways a structured annuity can be paid. The following payment methods are the most common in settlement cases.

Lump Sum Payment: As we discussed in the first section, there are many negative examples of plaintiffs that elected to take a lump sum payment and ended up spending that money unwisely; however, there are some benefits. Typically, a lump sum payment is a good option for a cash-strapped person that is delinquent on bills that are accruing interest. Whether it’s a mortgage, credit card debt, or car payments, a lump sum payment can help the plaintiff immediately pay off these overdue bills.

Deferred Lump Sum Payment: Settlement planning can incorporate significant future expenses into the plan. This way the capital will be saved away for when that important date arrives. For example, a plaintiff can allocate that a large portion of their settlement is made available when their children turn 18 for college tuition or when they are entering the retirement years.

Steadily Increased and Decreased Payments: One of the most common payment strategies is to slowly increase the payment over time. These structured annuities are very beneficial to help adjust for inflation by increasing over time. Adversely, a settlement recipient can also allocate their payments to decrease over the years as well. This may be ideal for a younger person that wants to pay off student loans and expects to earn more money in the future.

For more information or to schedule a consultation, please contact us today.

7 Common Workplace Injuries That Could Require Medicare Set Aside Services

Utilizing a Medicare Set Aside for personal injury can be confusing without the help of an experienced settlement consultant from Synergy Settlement Services. Fortunately, our Medicare Set Aside (MSA) services help attorneys focus on the case at hand by allowing an experienced professional to handle the details of their client’s settlement.

It’s easy to get lost in the confusing world of settlement planning, which includes mass torts, pooled trusts, asset management services, and more, when you take on this burden alone, especially when you consider the broad range of personal injuries that can require Medicare Set Aside services. In this article, we will discuss seven common injuries that often require our settlement services.

Violent Acts in the Workplace

Conflict is common in the workplace. Sometimes, these arguments escalate to fights which can lead to serious physical injuries. Depending on the circumstances of the violent act, an MSA may be required.

Vehicular Accidents

If your client was injured while driving a vehicle, such as a bulldozer or a crane, for business purposes, they could be eligible for a workplace personal injury claim. This is especially true if their employer failed to utilize effective training programs to teach workers about safety.

Machine Entanglement

People who work in close proximity to machines should be aware of how to safely interact with these mechanisms. Machine entanglement occurs when clothing, shoes, or body parts are snagged by moving machinery.

Repetitive Motion Injuries

Repetitive motion injuries are extremely common and oftentimes undiagnosed. This type of injury occurs when workers perform the same action for too long. For example, typing or extensive computer usage can lead to muscle strain, vision problems, and even carpal tunnel syndrome.

Falling Objects

Workers, especially those in the construction industry, are often at risk of being injured by falling objects. Typically, this results in head injuries. Employers are responsible for maintaining safe workplaces and supplying workers with any appropriate protective gear.

Falling Personnel

On elevated project sites, the risk of workers being injured from a fall is increased substantially. Slip and fall accidents can be attributed to faulty equipment, poorly implemented safety precautions, or a lack of personal protective equipment. Falling personnel are a common source of workplace personal injury claims.

Overexertion

Overworked employees can easily injure themselves during actions like pulling, lifting, pushing, holding, carrying, or throwing objects in the workplace. Overexertion is one of the most common causes of workplace injuries that could require Medicare Set Aside services.

If your client is collecting a settlement for a workplace injury, regardless of the type of injury, Synergy Settlement Services is prepared to offer our services.

For more information about a Medicare Set Aside for personal injury or to schedule a consultation, please submit our contact request form.

The Most Common Types of Mass Tort Cases Part 2

In this two-part article, we are discussing the most common types of mass tort cases. By design, mass tort cases help trial attorneys consolidate the best interest of several people (claimants) who suffered damages into a civil action against the entity that caused this occurrence (the defendant). Because this is an extremely tedious and time-consuming process for an attorney, hiring a specialized professional to assist with the settlement process can be greatly beneficial. As the attorney focuses on the legal nuances of the case, our experts maximize the value of the settlement while also providing settlement planning services that protect those assets long-term.

In the first section of this two-part series, we discussed mass tort cases that involve pharmaceutical drugs. Whether it’s a defective drug that was manufactured and sold, there were unknown side effects associated with the drug, or the drug was poorly marketed, these are common cases. Here are four other common types of incidents that affect several people and can result in a mass tort case.

Medical Devices

Similar to pharmaceutical drugs, another serious issue in the medical field is injuries that occur after a medical procedure. Unfortunately, the medical device industry is poorly regulated and in many cases, devices that are utilized do not undergo significant testing before they are applied. If a defective device is implanted in a patient, this can seriously impact their health and wellness in a variety of ways.

Product Liability

Many people suffer damages because they utilized a defective or harmful product. Whether the manufacturer was at fault, the design of the product was inherently dangerous, or the product failed to provide the consumer with proper instructions or warnings, these negative experiences can lead to a mass tort case. Product liability claims can span from the automotive industry to retail products to the medical industry.

Environmental and Toxic Contamination

There are a variety of ways that the environment and chemical exposure can damage the health of public bystanders. Here are some examples of toxic or environmental contamination mass torts:

Asbestos, silica, mold, chemical, and fumes exposure
Contaminated natural resources like soil, water, and air
Long-term pollution in a redeveloped toxic area
Failure to mitigate emergency contamination accidents

Large Scale Catastrophe

When a disaster happens, like when a fire occurs in an apartment complex or manufacturing plant, this tragic occurrence can be consolidated into a mass tort. During a large scale catastrophe, a variety of injuries occur that can uniquely impact each victim.

For more information about settlement planning services or to schedule a consultation, please submit our contact request form.

The Special Needs Trust: 3 Types

The Special Needs Trust (SNT) is designed to protect individuals with disabilities who are receiving money through a trust. The SNT is an effective tool because it places funds and other relevant assets in the control of a trustee to make it easier for an individual with special needs to save money while avoiding any possible breaches such as spending more than the active Supplemental Security Income/Social Security Disability (SSI/SSDI) resource limit of $2,000.

Few realize that breaching a trust can lead to a recipient losing their eligibility for federal and state benefits, so it is important to work with a settlement planner from Synergy Settlement Services who understands the nuances of SNTs. In this article, we will discuss the three types of trusts associated with SNTs: the First-Party Trust, the Third-Party Supplemental Trust, and the Pooled Trust.

First-Party Trust

This trust must be filed and completed by a parent, grandparent, or the court. It cannot be filed by the special needs beneficiary although this trust is funded by the assets of the beneficiary. As long as the beneficiary is living, the funds in the trust can be utilized for their benefit. Once the beneficiary passes away, the government is reimbursed for their Medicaid costs, often referred to as a payback provision.

Third-Party Supplemental Trust

Like the First-Party Trust, a Third-Party Supplemental Trust allows a disabled beneficiary to relinquish control of their trust to an entity who may be able to more suitably manage finances for long-term success. This is a common form of SNT because the trust is permitted to hold any type of asset from the donor including a house, stocks and bonds, or alternative types of investments. This type of trust also applies to beneficiaries of life insurance policies. Arguably the most important thing to understand about this trust is that since the SNT is never placed in the beneficiary’s name, the remaining funds will be passed on to family members or a preferred charity instead of the government if the beneficiary passes away.

Pooled Trust

When utilizing the Pooled Trust, all trust money is held and distributed by a non-profit 501c3. This can help avoid conflicts of interest and ensures that all money is issued according to necessity. Like the First-Party Trust, it also includes a payback provision. Is there not enough money for a stand-alone SNT for your client? This type of trust allows beneficiaries to combine their resources in a “pool.” This makes it easier for beneficiaries to invest their money wisely. Once again, if the beneficiary dies, the remaining money is passed on to another, non-government entity. Although a portion will often be given to the non-profit trust manager.

For more information about a pooled trust or to schedule a consultation, please submit our contact request form.

Negotiating Catastrophic Workers’ Comp Claims

It is a very common practice for insurance carriers to negotiate catastrophic workers’ compensation claims using offers in the form of both upfront cash to the claimant and a structured settlement. At a minimum, any case involving a Medicare set aside will typically be funded with a structured settlement annuity. AIG, Berkshire Hathaway, and USAA not only have property and casualty companies which ensure the employers, but they also have their own in-house structured settlement programs. If they can get the claimant to agree to a structured settlement with their own company, they may see additional financial benefits at the expense of the claimant. This is why it is imperative for attorneys who represent injured workers to have their own settlement consultant to ensure that if any settlement offers are made in the form of a structured settlement, that the claimant will, in fact, get the largest payout available from the highest rated company/companies.

In a recent case, we were asked to attend a settlement conference for a paraplegic where AIG was the excess carrier. There was a $550k WCMSA and the claimant was receiving 12 hours a day of attendant care. Every offer made during the mediation contained a structured settlement payout for not only funding the WCMSA obligation but also for the attendant care for the lifetime of the claimant. The case ultimately resolved for $3.0 million, of which $1.25 million was used to fund a structured settlement. What is important to note is that Synergy was able to hold AIG’s feet to the fire regarding what companies to use for funding the structured settlements. We were able to put nearly $88k in additional dollars directly in the claimant’s pockets in the form of a cost savings to purchase those same structured settlements since the employer/carrier’s structure broker was only quoting AIG. Prior to mediation, we had priced out the entire annuity marketplace and knew that New York Life and Pacific Life had the best rates respectively, not AIG. We were able to leverage that information for the benefit of our clients.

There is a difference between a settlement consultant/planner and a structured settlement “broker”. A broker sells structured settlement annuities while a settlement consultation/planner is an expert who provides a “settlement plan”. A settlement consultant should have an arsenal of options for the claimant to consider as part of any settlement plan. A structured settlement is generally the cornerstone of any settlement plan for a catastrophic workers’ comp claim, but it cannot be the only component for consideration by the injured worker. A qualified expert should also have extensive knowledge in dealing with trusts, Medicare Set-Asides, MSP compliance as well as public benefit protection. Most importantly, they should have the experience in assisting both claimants and claimant’s attorneys on catastrophic workers’ compensation cases.

At Synergy, we frequently attend settlement conferences/mediations either in person or by phone at NO COST to the attorney or injured worker. Our expert settlement consultants can quarterback the settlement process as part of a holistic settlement team approach. This approach may include utilizing our certified Medicare set aside specialists, certified financial planners, nurse allocators, economists, subrogation analysts, or public benefits attorneys to provide direct support before, during and after the negotiations. Don’t rely upon the employer/carrier’s “structure specialist”. Those “specialists” are brokers and are there to protect the employer/carrier, not the claimant and the claimant’s attorney. The earlier Synergy gets involved in the settlement process, the better equipped you will be to recover maximum available dollars. Call us today to show you how we can help increase the value of the case, protect your firm/your client and assist in getting catastrophic claims to the finish line expeditiously when dealing with CMS or Medicare eligible claimant.