Friday, September 5, 2008

Use of pre-paid debit cards in workers' compensation cases

Some of the major issues that our workers’ compensation clients face on a daily basis is the payment of medical bills, the payment for prescriptions and the timely receipt of their bi-weekly or weekly wage benefit checks. Often, the staff at C&C law take care of what is normally a minor issue of red tape but is a major issue for injured workers who either cannot get prescribed medications or cannot pay their bills because their workers compensation check is late.

Our friends at Ziff Law pointed this out on their blog:

J.P. Morgan announced that they are issuing prepaid debit cards so insurance companies can deliver workers’ compensation benefits to injured or disabled workers in a timely and effective way. From the press release from J.P. Morgan, “card holders benefit from efficient, economical and reliable access to insurance payments without having to wait for a check to arrive in the mail.” One of the “benefits” of having this type of debit card, as per the press release, is that the injured worker would be able to receive cash back at ATM machines and retail locations and also pay bills on-line and make purchases that accept Visa debit cards.

Although this seems, at first glance, a benefit, it certainly has the risk of being abused and/or misunderstood. If we ever see these cards in our practice area, I am sure that a separate letter and counseling to the injured worker would be in order to ensure the cards are not a credit card and provide credit. They are merely a debit card and will only work if there are funds in the account.

In any event, it is certainly a intriguing use of current technology for a burdened workers’ compensation system.

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