Working with Litigators to Protect Personal Injury Settlements

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Personal injury settlements or awards often do not pay for all of the injured person’s medical and care expenses and replace the individual’s lost lifetime income. This failure is due to a number of factors, including compromises of claims involving questionable negligence, limited resources or limited insurance coverage of the tort feasor, medical liens, and fees and costs associated with the litigation. Coordination of the settlement or award with eligibility for government benefit programs, such as Supplemental Security Income (SSI) or Medicaid, can be essential to helping the injured person adjust and sustain as much as possible an independent life.

Because of their expertise with the eligibility requirements of government benefit programs, elder law attorneys are able to assist personal injury attorneys with the coordination of the settlement or award and the injured person’s eligibility for government benefit programs.

Federal and state laws authorize the use of d(4)(a) and d(4)(c) trusts to protect the SSI and Medicaid eligibility of injured persons under the age of 65. These trusts must be irrevocable and contain a payback feature for Medicaid benefits received when the recipient beneficiary dies.

Hook Law Center suggests that the personal injury attorney consult with an elder law attorney early in the case in order for the personal injury attorney to learn about the impact of the settlement or award on the eligibility of the injured person to receive government benefits. This will free the personal injury attorney’s time to better focus on proving the case, and to help comfort and support the injured person.

The elder law attorney can also help the personal injury attorney to:

  • Avoid liability for failure to effectively apply for and manage private and public benefits after receiving the settlement or award.
  • Interpret ever-changing rules for public benefit programs.
  • Address issues involving Medicare and Medicaid liens that do not require notice and may impose personal liability to the personal injury attorney and the injured person.
  • Build flexibility into the settlement or award to maintain the injured person’s eligibility for government benefits if the injured person moves to another state.

The elder law attorneys at Hook Law Center are experienced in assisting personal injury attorneys and their clients with the coordination of the settlement or award with the client’s eligibility for government benefit programs.

About This Handout

This guide is provided as a courtesy to help you recognize potential estate planning issues.  It is not intended as a substitute for legal advice.  It is distributed with the understanding that if you need legal advice, you will seek the services of a competent elder law attorney.  While every precaution has been taken to make this explanation accurate, we assume no responsibility for errors or omissions, or for damages resulting from the use of the information in this explanation.