A lien is fancy legal talk for the right to take some of your property until you pay off a debt you are owed. It’s typically associated with a lien on a house by a builder. Basically it prevents you from selling the property until the debt is paid. With personal injury cases, health care providers will put a lien on your settlement. If their medical bill is $10,000.00, the lien requires you to pay them off or at least negotiate with them before you can accept a settlement.
With Illinois work comp cases, there are no liens allowed against your case. That means a doctor can’t hold up your settlement because your bill isn’t paid. That doesn’t mean you should blow off any medical bills. You shouldn’t. You should make your lawyer aware of all medical bills and get them to get the insurance company to pay them. If you don’t, you might get sued when the case is over.
Liens do play a big role in one aspect of Illinois workers’ compensation law. When you are injured due to the negligence of a third party, meaning not your company or someone from the company, you might have a lawsuit on top of the work comp case. Under Illinois law, the insurance company is allowed to recover up to 75% of what they paid in the work comp case from that third party case.
For example, if your lost time, medical bills and settlement total $100,000.00, if your injuries are from being rear ended while driving for work, the work comp insurance company could take up to $75,000.00 from any lawsuit you might have.
This lien becomes important when you have a major injury and a lawsuit against the third party that could be big. If you don’t pursue the lawsuit against them, the insurance company actually has the right to do so on your behalf so they can get their money. I almost never recommend you let them do that.
The reason I say that is that even though they can recover up to 75% of what they spend, that amount is negotiable. In addition, if we are handling both cases, we don’t double dip on the attorney fees. So we can put more money in your pocket in the end which is what your biggest concern should be other than getting healthy.
Some lawyers tell their clients to drop their work comp case in exchange for the insurance company waiving their lien. This is a terrible idea that you should not do unless both cases are so far along that you know what the ultimate outcome will be. There have been cases where injured workers dropped their work comp case and then got nothing from their personal injury case. You might not think that will happen, but bankruptcies and legal defenses can blow up any case.
Bottom line is that most injured Illinois workers don’t have to worry about liens, but if your injury is from a third party you should definitely talk to a lawyer to protect yourself and make sure you come out with the most money possible in the end.