On August 3rd new rules go into effective in Arizona regarding “full and final” settlements. These new rules help workers’ compensation carriers and employers but leave unrepresented workers’ compensation claimants at risk. The new rules say that Industrial Commission Judges who approve such settlements no longer have to consider whether the settlement is in the “best interests” of the injured worker or “fair and reasonable” to the injured worker. The Arizona Legislature stripped that language from the law in the last legislative session.
This is a significant change because it prevents the Industrial Commission Judges from protecting unrepresented injured workers. Already we are seeing workers’ compensation carriers offering “full and final” settlements that seriously under-estimate the cost of future medical treatment. Indeed there are companies like Sharpline which advertise to employers and insurance companies that they will come up with medical costs estimates that are the lowest defensible amount to satisfy the government.
In a full and final settlement, the injured worker gives up the right to future medical treatment and lost wage benefits under workers’ compensation. Such a worker is prohibited from using Medicare, AHCCS or private insurance to receive treatment for their work-related injuries. For that reason we are very careful before recommending a client accept a full and final settlement. Under the new rules unrepresented claimants should be cautious as well since the Industrial Commission Judge will not be there to protect them.