Texas law is extreme when it comes to handling medical malpractice lawsuit settlements where any insurance company has paid out any funds related to the claim. As you might expect in our current tort reform environment, the law is overly-generous to workers’ compensation carriers who can show up after a recovery to demand a cut.
Overall, workers’ compensation is a good insurance benefit for employees. It’s a strict liability system where a subscribing employee’s insurance company is on the hook for unlimited medical expenses and certain wage benefits for an employee’s compensable injuries that occurred in the course and scope of employment.
The way workers’ compensation can come into play in a medical malpractice case goes like this:
• An on-the-job injury results in a workers’ compensation claim.
• During medical treatment related to the claim, there’s medical malpractice.
• The workers’ compensation carrier must pay benefits to the injured employee for both the original injury and any additional damages caused by the malpractice.
• The employee/patient files a medical malpractice lawsuit and obtains the settlement or favorable jury verdict.
• The workers’ compensation carrier instantly appears with its hand out for a big slice of the pie.
This conduct by workers’ compensation insurance companies is allowed by Texas Insurance Code Section 417.002, which is part of the Texas Workers’ Compensation Act. That statute says: “The net amount recovered by a claimant in a third-party action shall be used to reimburse the insurance carrier for benefits, including medical benefits, that have been paid for the compensable injury.”
A top-rated experienced Houston, Texas medical malpractice lawyer can help analyze the impact of a potential workers’ compensation subrogation or lien on a case against a hospital, doctor, or other healthcare provider.