Attention! Iowa’s Workers’ Compensation laws changed July 1, 2017. This article’s information may be out of date. Visit our Workers’ Compensation Page for more information.
If you have a work injury and cannot work as normal, paying bills can suddenly become a serious issue. Waiting on workers’ compensation checks to come in the mail can be stressful. You never know if your checks will be coming in on time or in some cases if they’ll come at all.
Once you receive your weekly benefits check, you wonder if the amount you’re receiving is correct. If you’re having difficulty paying your medical and other bills while you are waiting on your workers’ compensation settlement, consider these tips to make it a little easier.
Submit Your Bills to Health Insurance or Make Payment Arrangements
If the workers’ compensation insurance company has denied your claim, and is not paying for medical care related to your work injury, it is important that you don’t let the bills go unpaid. If you have private health insurance, Medicare or Medicaid, tell your providers to submit the bills to insurance. If your workers’ compensation claim is denied, an insurance company cannot legally deny coverage of your medical bills simply because your care is related to a work injury.
If you don’t have health insurance, try to apply for Medicaid to cover bills going forward. For outstanding bills, trying to make payment arrangements with the hospital. Technically, medical providers are not allowed to send your medical bills to collections while a workers’ compensation claim is pending—that doesn’t mean they don’t try and once the bills have been sent to collections, the damage has been done. Even if you can only pay $5 per month, try to make a payment arrangement.
Explain your situation and ask them to lower your payments to a more manageable amount until you can get back on your feet. Do not tell them when or how much you may be receiving for your workers’ compensation settlement.
Seek Help with Living Expenses
Local community programs can offer support if you are having a difficult time making ends meet. If you live in the Cedar Rapids area, you can contact Linn County General Assistance at 319-892-5850, contact the United Way of East Central Iowa at 319-739-4211, or simply dial 2-1-1 on your landline. If you live in the Waterloo area, you can contact the Black Hawk County General Assistance at 319-292-2261. These programs may be able to help you with rent assistance, food, clothing, and utilities. Contact them to learn more.
Ask Family and Friends for Assistance
Check with your family and friends to see if they can offer any financial help. Although you may not want to borrow from your loved ones, it may be necessary in order to pay your bills. Establish a repayment plan with them and negotiate interest if they require it.
Borrow Against Your 401(k)
If you have a 401(k), you may be able to pull money out of your account early to pay for your medical bills. There are two ways to do this: you can take out a loan against your 401(k) or you can apply for a hardship withdrawal. A loan is preferable, as you are not subject to taxes or the ten-percent penalty fee. If you have an immediate need and your employer doesn’t allow 401(k) loans, you may be able to apply for a hardship withdrawal. This is money that you cannot repay and has a very strict set of rules in order to withdraw the money you need.
Do Not Take Out a Legal Financing Loan
You should not take out a legal financing loan against your workers’ compensation settlement. Although this may seem like an attractive option, read the fine print. These companies charge outrageous fees just to get the loan, and then can and will charge you over 50 percent interest on your loan–and it’s perfectly legal to do so! Even if you receive a substantial settlement for your work injury, you may end up with little to no money after you pay back the loan plus high interest. This is especially true if you take out the loan at the start of your workers’ compensation claim, because the interest on these loans accrues substantially over time. You should not pursue this option before talking to a workers’ compensation attorney. They may be able to find you help through other channels.
If you have questions about settling your workers’ compensation claim, contact RSH Legal at 1-319-774-1542.