Court OKs $57M verdict for WA home-care workers
Headline Legal News
Washington's Supreme Court on Thursday narrowly upheld a $57 million verdict against the state in a case brought by workers who care for severely disabled people. But the justices declined to give the workers pre-judgment interest — throwing out an additional $39 million awarded by a lower-court judge.
The 22,000 workers claimed they were shortchanged by a 2003 rule from the Department of Social and Health Services that automatically cut their pay by 15 percent. The rule was based on the rationale that because the caregivers lived with their charges, then some of the work performed — cooking, for example — also benefited the caregiver, who shouldn't be paid for it.
The high court struck down the rule in 2007 as inconsistent with federal Medicaid requirements, and the workers sued to get the money they said they were owed. After tortuous litigation that included a detour into federal court, a Thurston County Superior Court jury sided with the workers in 2011 and awarded $57 million. The state appealed, but the high court sided with the workers 5-4 Thursday.
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Workers’ Compensation Subrogation of Administrative Fees and Costs
When a worker covered by workers’ compensation makes a claim against a third party, the workers’ compensation insurance retains the right to subrogate against any recovery from that third party for all benefits paid to or on behalf of a claimant injured at work. When subrogating for more than basic medical and indemnity benefits, the Texas workers’ compensation subrogation statute provides that “the net amount recovered by a claimant in a third‑party action shall be used to reimburse the carrier for benefits, including medical benefits that have been paid for the compensable injury.” TX Labor Code § 417.002.
In fact, all 50 states provide for similar subrogation. However, none of them precisely outlines which payments or costs paid by a compensation carrier constitute “compensation” and can be recovered. The result is industry-wide confusion and an ongoing debate and argument with claimants’ attorneys over what can and can’t be included in a carrier’s lien for recovery purposes.
In addition to medical expenses, death benefits, funeral costs and/or indemnity benefits for lost wages and loss of earning capacity resulting from a compensable injury, workers’ compensation insurance carriers also expend considerable dollars for case management costs, medical bill audit fees, rehabilitation benefits, nurse case worker fees, and other similar fees. They also incur other expenses in conjunction with the handling and adjusting of workers’ compensation claims. Workers’ compensation carriers typically assert, of course, that, they are entitled to reimbursement for such expenditures when it recovers its workers’ compensation lien. Injured workers and their attorneys disagree.