How Lawyers Get Paid In Personal Injury And Social Security Disability Cases
Lawyers handling personal-injury, Workers’ Compensation and the Social Security disability cases almost always work on a contingency basis. This means that they must succeed in winning the client’s case or proving the client is entitled to benefits in order to receive a fee for their services. In other words, they may devote many hours to a case and possibly not get paid for their time involvement.
In personal-injury cases (i.e. claims usually based on someone’s wrongful conduct), the lawyer receives a percentage of the settlement or judgment amount obtained for the client.
In Workers’ Compensation cases, fees are paid in one of two ways. The lawyer receives 25 percent of a settlement or of the increase in benefits obtained up to a specified limit. On denied claims, the judge or the Workers’ Compensation Board will award an attorney fee amount based on criteria such as the complexity of the case, time spent on the case, amount of benefits in question, and the risk of losing. This fee is awarded only if the lawyer succeeds in overturning a denial of benefits to the worker.
The attorney who succeeds in obtaining a reversal of a Social Security disability denial is entitled to 25 percent of the past due disability benefits, up to a maximum of $4,000. This fee structure and ceiling is set by Social Security law.
Attorney fees are for the professional services of the attorney only; and, of course, must cover all the overhead, staff salaries, etc. of the law office.
Costs are the expenses of pursuing a legal claim. The costs of a case have nothing to do with the attorney fees and are ultimately borne by the client.
If the case is successful, the costs of the case will be subtracted from the client’s recovery (that is, the settlement, judgment or benefit award). If the case is not successful, the client is still legally responsible for these expenses.
The costs include charges for medical records, paying doctors for statements and reports, and paying doctors’ fees for depositions or testifying in court. Other costs are court filing fees, charges for other expert witnesses and outside investigations, as needed, and other miscellaneous expenses.
In Workers’ Compensation cases, the insurance company pays for doctors’ records and statements; however, this does not happen in personal-injury and Social Security cases.
For a simple, uncomplicated personal-injury claim, the costs of going to court can average between $2,000 and $4,000.
In extreme cases – such as that described in the best-selling, nonfiction account A Civil Action by Jonathan Harr – proper preparation and presentation of the personal-injury (and wrongful death) case in trial may result in costs well into the hundreds of thousands of dollars. These cases might involve product liability (e.g., Pinto gas tanks, Toyota rollovers, etc.) or other cases with huge damage claims, involving injuries to many persons.
Medical bills resulting from the incident in dispute are almost always paid for in their entirety in a successful personal-injury case. In successful Workers’ Compensation cases, medical bills are paid according to fee schedules and as provided for under the Workers’ Compensation laws. Medical bills are not paid as part of Social Security disability benefits. However, successful Social Security disability claimants qualify for Medicare, after a waiting period. Also, disabled claimants eligible for Supplemental Security income (SSI) receive Medicaid immediately.
Even where personal injury, Workers’ Compensation and disability claims are unsuccessful, “back up” health, injury or disability insurance may be available to help with medical bills.
The costs of a legal dispute – which in most cases is not the fault of the injured or disabled person, and takes him or her by surprise – are a different story. They are always borne by the patient/client. Attorney fees are always contingent upon the outcome of the claim.
This article was prepared by Robert L. Chapman.