The WC carrier can recoup medical benefits from proceeds of claimant’s third-party recovery even though claimant cannot recover medical costs under New Jersey’s no-fault system.

The workers’ compensation insurance carrier asserted a lien from the proceeds of the claimant’s third-party recovery. The claimant argued that, as a no-fault insured, she may not recover medical benefits from another no-fault insured. Since the employer’s workers’ compensation carrier’s subrogation rights are limited to claims a plaintiff may assert under N.J.S.A. 34:15-40(f), she argued that the workers’ compensation carrier had no entitlement to attach the recovery from the tortfeasor to recover medical expenses it previously paid. The Law Division denied the plaintiff’s motion. In affirming this ruling, the Appellate Division relied on a review of the Automobile Insurance Cost Reduction Act, N.J.S.A. 39:6A-1.1 to 35, in conjunction with N.J.S.A. 34:15-40, the subrogation provision of the Workers’ Compensation Act. In instances where an employee, as a result of injuries sustained from a work-related motor vehicle accident, also has a claim for recovery against a third party, the New Jersey Legislature overcame the possible inequity of double recovery by including N.J.S.A. 34:15-40 of the Workers’ Compensation Act, which requires an injured employee to refund paid workers’ compensation benefits once recovery is obtained from the tortfeasor, thereby avoiding duplication of the workers’ compensation benefits. Accordingly, the Appellate Division found no basis to interfere with the Law Division’s ruling and affirmed that the defendant’s lien must be satisfied from the proceeds of the plaintiff’s third-party recovery.

_{Case Law Alerts, 4^th Quarter, October 2016. Case Law Alerts is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Copyright © 2016 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. This article may not be reprinted without the express written permission of our firm.}