Written By: Colin Adair Morgan, Esquire
Julian Gray Associates
Personal injury lawsuits are an extremely difficult time for a catastrophically injured person. The Plaintiff is severely injured, generally unable to work, extremely vulnerable, and being subjected to the rigors of a lawsuit. At the end of this process, the Plaintiff is often rushed to receive the proceeds from his/her Personal Injury Matter and has one shot at stretching this influx of resources for the rest of his/her life. Unfortunately, as with so many facets of sudden wealth management, there are numerous pitfalls and problems that affect settlement recipients. The following paragraphs will outline some of these issues and ways a professional practitioner can help.
Maintaining Government Benefits:
Catastrophic injuries generally lead to an elevated daily care need. This care can be extremely expensive and, without the help of government benefits like Medical Assistance, can drain the entirety of the settlement very quickly. Despite not being enough to cover care needs, let alone provide for a good quality of life, most larger settlements will seemingly render a Plaintiff ineligible for these programs indefinitely. An experienced and knowledgeable Settlement Planning Attorney can help a client navigate these programs with the proper planning. It is vital for a Plaintiff to receive the care he/she needs in a manner while simultaneously not squandering the entire settlement.
Planning for Heirs:
While some Plaintiffs may get advice with regards to enrolling in government benefits programs, that advice may inadvertently lead to the injured party not having anything left to give to his or her children or loved ones. The typical plan for a Plaintiff post-settlement is to set up a Special Needs Trust to hold the settlement proceeds. This allows the injured party to enroll in Medical Assistance and use his/her money for extra items and services. What is generally not considered is what happens when the settlement recipient passes away. When an Medical Assistance recipient with a Special Needs Trust passes away, any funds held in the Special Needs Trust are used to reimburse the state for benefits received. This means the injured party may functionally have nothing to leave to his/her family at the end of the day. There are cutting edge planning techniques that can be employed to both access government benefits and leave the family an inheritance. These techniques require the services of a savvy, experienced Settlement Planning Attorney to successfully employ.
Protection from Bad Actors:
Medical care and maintaining government benefits are only part of the overall picture of what a settlement recipient must face. Family strife, bad decisions, ex-spouses, friends asking for loans, and unscrupulous business offers are only a small portion of the outside noise with which an injured person could be confronted. It is incredibly difficult for a person to deny these requests, even if they know it is not in their best interests. There needs to be a strong, unrelated third professional involved to support the injured party. A Settlement Planning Attorney can fulfill this role and investigate other, parallel professionals to help support and insulate a recent settlement recipient. A Settlement Planning Attorney, along with other reliable professionals is the most effective way to protect an injured person from herself or ne’er-do-wells.
Assembling the Team:
Vital services to support a catastrophically injured person do not end with legal work. A team made up of: lawyers, financial planners, professional trustees, accountants, social workers, nurses, and other related professionals all need to circle the wagons around an injured person to successfully manager his/her case. Even if a settlement recipient recognizes that these professionals are necessary, it is nearly impossible to know where to start to find the right people. A qualified, experienced Settlement Planning Attorney will have a great depth of knowledge of these professions as well as a solid network to call to the injured person’s aid.
In summary, settling a personal injury lawsuit is only the beginning of the battle for a catastrophically injured client. Collecting the proper professionals, protecting the client from bad decisions/bad actors, planning for intergenerational wealth, and achieving/maintaining government benefits are among the numerous issues a settlement recipient will face. Identifying and solving for these issues is best left to a qualified, experienced Settlement Planning Attorney.