What To Do AFTER Settling Your Workers' Comp Case!

We’re going to break down what you need to do after your case is settled—everything from smart money moves to staying on top of your healthcare—so you can make sure your settlement works for you, not against you.

What Happens Immediately After You Settle Your WC Case?

Settling your workers' comp case is a big deal, but before you start making plans, it’s important to know exactly how the settlement process works and what to expect. Not all settlements are the same, and the type you get can make a big difference when it comes to your finances and medical care down the road.

Generally, workers' comp settlements fall into three main categories:

• Section 32 Settlements: This is an all-or-nothing deal. You get a one-time lump sum payout, but in exchange, you give up your right to any future benefits—medical treatment included. It’s a good option if you’re ready to move on, but it can be risky if you still need medical care.
• Stipulated Agreements: With this type of settlement, you and the insurance company agree on a set amount of compensation, but your medical benefits stay open. This gives you a little breathing room financially while making sure you can still get treatment if you need it.
• Judge-Approved Decisions: Sometimes, if you and the insurance company can’t agree, a judge will step in and make the final call based on the details of your case. This can take longer, but it’s often the best way to settle things when there’s a disagreement about how serious your injury is or how much money you should get.

Once everything is finalized, it usually takes about two to three weeks for your check to arrive. But, keep in mind—things don’t always go smoothly. If someone appeals the judge’s decision, it could drag things out longer. If both sides are on the same page, though, you should see your money within a few weeks.

Most workers' comp settlements are lump sum, meaning you get all your money at once. This can be great if you’ve got immediate expenses or want to invest it wisely.

On the other hand, some cases—especially third-party claims or settlements in other states—offer structured settlements, where the money is paid out over time instead of in one big chunk. While this option gives you a steady flow of income, it also means less financial flexibility.

How Should You Handle the Funds After Receiving Your WC Settlement?

Before you go on a spending spree, hit pause and think things through. One of the biggest mistakes people make is treating their settlement like free money instead of what it really is—your financial safety net for the future.

Here’s where to start:

• Make a budget. Figure out how much you need for monthly expenses like rent, utilities, and groceries.
• Set up an emergency fund. Having a cushion can save you from financial stress later on.
• Pay off high-interest debt. Knocking out credit cards or loans with steep interest rates can free up more of your money in the long run.

Once your case is settled, those regular comp checks you’ve been getting will stop. There’s usually a 2-3 week gap between your last payment and when your settlement check arrives. That means you’ll need to have enough set aside to cover your bills during that time so you don’t fall behind.

The good news? Workers' comp benefits are tax-free in most states, including New York. So you get to keep every penny. But, before you celebrate, remember that not all settlements are tax-free—especially if you’ve got third-party claims involved. It’s worth checking in with a tax pro to make sure you don’t end up with an unexpected bill later.

If you owe back child support, spousal maintenance (alimony), or unpaid taxes, don’t be surprised if a chunk of your settlement is taken to cover it before you even see the money. The state doesn’t mess around when it comes to collecting what’s owed. If you’re current on your payments, you’re in the clear, but if you’ve fallen behind, expect them to take what’s needed right off the top.

How Does Medical Care Work After Settling Your WC Case?

When you settle your case, your medical benefits either stay open or get closed, and knowing which one applies to you makes a big difference.

• Open Medical Benefits: This means your workers' comp insurance will still cover treatment related to your injury. Sounds great, but keep in mind—they’ll likely keep a close eye on your care and may push back on certain treatments or require you to see their doctors for regular check-ins.
• Closed Medical Benefits: If your settlement closes out medical coverage, you're on your own for any future treatment. That means any doctor visits, medications, or therapy sessions will come out of your pocket. Planning ahead is key if you’re in this boat.

If Medicare is in the picture, things get a little more complicated. If your settlement included a Medicare Set-Aside (MSA), that money is specifically meant to cover future medical expenses related to your injury. Medicare won’t step in to pay until you’ve used up those funds the right way—meaning you need to follow their rules carefully.

Here’s what you need to do:

• Keep the MSA money in a separate account.
• Use it only for approved medical expenses related to your injury.
• Track every dollar you spend so you don’t run into issues down the road.

Not following Medicare’s guidelines can leave you without coverage when you really need it, so it’s worth getting help if you’re unsure how to manage it.

Another important aspect of your medical care after settling is staying in contact with your healthcare provider—they know your medical history, can spot changes in your condition, and help if you ever need to revisit your case down the line. Plus, having regular check-ups can help catch any new issues early before they become bigger (and more expensive) problems.

A few tips to stay on track:

• Keep your medical records organized in case you need them later.
• Schedule regular check-ups even if you’re feeling fine.
• Ask your doctor for advice on managing long-term symptoms.

What Else Should Injured Workers Keep in Mind After Settling Their WC Case?

We've covered your future financial plans and your physical health, what else should be considered after settling your Workers' Comp case?

Potentially Reopening Your Case

Reopening your case depends on the type of settlement you agreed to:

• Section 32 Settlements: These are usually final. Once you settle, you’re done—no going back, even if your condition gets worse.
• Stipulated Agreements: You might be able to reopen your case if your condition takes a serious turn, but you’ll need solid proof—just saying you’re still in pain won’t cut it.
• Judge-Approved Decisions: If a judge made the final call on your case, you may be able to revisit it, but you’ll need to show a major change in your condition.

Not sure if your case can be reopened? It’s best to check with your lawyer.

Going Back to Work

Thinking about heading back to work? Here’s what you should know:

• If your case is fully settled, working won’t affect your payout.
• If you’re getting ongoing payments, earning the same or more could stop your benefits, but if you're making less, you might still qualify for partial payments.

Financial Assistance

If you’ve got a permanent partial disability and money’s tight, you might qualify for extra help. Some states offer hardship benefits if your disability rating is 75% or higher, especially in the final year of your payments.

Contact Us For Help With Your Workers' Compensation Case

Life after a workers' comp settlement can be a lot to handle—managing your money, planning for medical care, and figuring out what’s next. The good news? You don’t have to do it alone.

Give me, Rex Zachofsky, a call at 212-406-8989, and let's talk. No pressure—just real answers to help you stay on track. You’ve got this, and I’ve got your back. Reach out anytime.