Using Private Health Insurance For A Work Injury: Not a Good Idea

Many workers use health insurance for work-related injuries because:

health insurance is easier to use and they don’t want to deal with a lot of paperwork that involves reporting the claim with the employer
the employer requests it from the worker so that the employer will not have to pay increased premiums for worker’s compensation.

As a general rule, however, you should not use private health insurance for a work injury because workers’ compensation insurance should pay for that injury.

Even if you can possibly get away with it, here are the arguments for why you should not use private health insurance for a work injury:

To avoid having to lie to your doctor about where and how you got your injury.
You will not receive compensation for lost wages, transportation to and from medical appointments and the pharmacy, disability benefits, and funeral expenses.
There is no deductible, co-pay, or out-of-pocket maximum with workers’ compensation.
You will be barred from receiving workers’ compensation if you don’t make a claim within two years from the date of injury.
You may jeopardize your potential of filing a third-party injury claim.

Why some workers end up using private health insurance and not workers’ compensation

Some workers prefer to use private health insurance because they don’t want to deal with a lot of paperwork. Most workers prefer to receive immediate treatment from their preferred doctor under private health insurance rather than delayed treatment from a selected list of doctors from workers’ compensation insurance. With private insurance, workers can usually use their preferred doctor while workers’ compensation requires you to choose from a selected group of doctors. Most workers also don’t want to go through the inconvenience of having to report the injury to their employer and filling out the necessary paperwork and documentation before receiving medical treatment, especially when the injury is minor.

However, it’s always better to use workers’ compensation for work-related injuries because of a number of reasons.

It’s good not to lie to your doctor about where and how you got your injury.

Work-related injuries should be compensated by workers’ compensation insurance, while other injuries are covered by private health insurance. If your doctor finds out that your injury is work-related, your doctor will refuse to treat you. This is because there is a possibility that the doctor will not get paid for his services by the insurance company if the injury the doctor is treating is work-related. For this reason, most workers lie about where they received the injury in order to avail of private health insurance rather than workers’ compensation insurance. Lying can potentially limit your ability to file a third-party injury claim, especially when your minor injury turns out to be serious.

You will not receive compensation for lost wages, transportation to and from medical appointments and the pharmacy, disability benefits, and funeral expenses.

Private health insurance will not pay lost wages, transportation to and from medical appointments, disability benefits, and funeral expenses, all of which are covered by workers’ compensation insurance. Lost wages cover time off from work to treat the injury, including time off from work to attend medical appointments. In case you become disabled due to the work-related injury, private health insurance will not pay for disability benefits unless the worker is separately covered by disability insurance. Funeral expenses are also not covered by private health insurance. When the minor injury sustained turns out to be serious, these benefits add up and are important.

There is no deductible, co-insurance, co-pay, or maximum out-of-pocket amount with workers’ compensation.

Usually, private health insurances have deductible, co-pay, and out-of-pocket maximum terms that you have to pay as your share in your medical costs with the insurer. A deductible is an amount that you have to pay each year for your medical expenses before your insurer will pay for the rest. A co-pay is a flat fee you pay each time you go to the doctor or fill a prescription. The out-of-pocket maximum is the most amount you should pay per year for your medical expenses. Co-insurance is a percentage of the medical cost you have to pay after reaching the deductible.

For example, you have a deductible of $2000, a co-pay of $50, co-insurance of 20%, and an out-of-pocket maximum of $5000, you went to the doctor who then diagnosed you with appendicitis, which required you to get an appendectomy worth $30,000, you will have to pay:

a flat fee of $50 to see your doctor as your co-pay
the first $2000 as deductible
since your co-insurance is 20% of 30,000 which is $6000 but you have an out of pocket maximum of $5000, you will pay another $3000 to cover your share of the appendectomy, and the rest of the $25,000 will be paid by the private health insurance

In contrast, workers’ compensation insurance will cover all these eligible costs.

You may be barred by the statute of limitations.

If you get injured in the workplace but keep using private health insurance to treat it, after two years, you will be barred from claiming a workplace injury. If your injury turns out to be serious or disability-forming and two years have passed since your date of injury, you will be barred from filing your claim.

You jeopardize your potential of filing a third-party injury claim.

If you get injured in the workplace and instead of filing with workers compensation, you file your claim with private health insurance, this is evidence that you were not injured in the workplace. If your claim for a third-party injury claim is based on your injury in the workplace, your claim with the private health insurance can be used against you.

Although claiming with workers’ compensation can be inconvenient, it is better to do the right thing and file your claim with workers’ compensation if your injury is work-related. Sometimes, a minor injury can lead to permanent disability, and filing with your private health insurance can be used against you as evidence that your injury is not work related.

If you have suffered a work-related injury, you can call us to know your legal options and remedies. Should you need assistance in evaluating your case, we at the Law Offices of Albert Goodwin are here for you. We have offices in New York City, Brooklyn, NY and Queens, NY. You can call us at 212-233-1233 or send us an email at [email protected].