The goal of lawyers who represent plaintiffs in personal injury and wrongful death lawsuits is to help the client. But sometimes the receipt of proceeds from a lawsuit can actually cost your client money.
How can that be? If your client is receiving Supplemental Security Income (SSI) and the settlement results in your client having more than $2000 in the bank your client loses his or her SSI payments. More importantly, people who receive SSI usually receive Medicare benefits – and the loss of SSI for people under 65 will result in a loss of Medicare benefits. So, you may "win" the case for your 45 year old previously disabled client and put $50,000 in her pocket, but without appropriate planning she will lose her SSI benefit and her health insurance. If she has a significant health issue while she is without insurance, she may end losing not only the balance of her personal injury settlement but also whatever she had before the litigation started.
What is a lawyer to do? First, learn whether or not your client receives SSI and Medicare. Second, understand how receipt of settlement proceeds will impact those benefits. Third, determine if there is an appropriate way to structure the receipt of money to preserve the benefits. Fourth, if there is not a way to do so, make sure your client understands that the settlement will result in a loss of government benefits before your client agrees to accept a settlement proposal.