What is a lump sum advancement—and should I take it?

Taking a lump sum advancement of workers's comp in OHA workers’ compensation lump sum advancement (LSA) is the pre-payment of future compensation for a specified purpose available to those receiving permanent total disability (PTD) or permanent partial disability (PPD) scheduled loss awards.

While this benefit is intended to help injured workers who have an immediate financial need, it might be a good idea to exhaust other options before taking an LSA.

When You Might Need to Take a Lump Sum Advancement

It’s hard enough to make ends meet when you're working full time, so offering a pot of money to help with expenses when you become disabled is tempting. To qualify for a lump sum advancement, you must also show you need financial relief. According to the Bureau of Workers’ Compensation (BWC), you may request a lump sum advancement for:

  • Household expenses. Bills will keep coming, but if you're behind in paying rent, mortgage, utilities, or insurance, it might make sense to take a lump sum to get caught up.
  • Emergency expenses. If you need a new roof, a vehicle, an appliance, or have some other major emergency purchase, you can request a lump sum if you submit an estimate and a reason to the BWC ahead of time.
  • School tuition. An LSA can pay tuition for the injured worker or their children.
  • Adaptive equipment. In some cases, there's an immediate need for a wheelchair, ramp, vehicle modification, or other adaptive equipment. An LSA can be used for that if it's not already covered under your claim.

It's important to understand that the amount you'll get in a lump sum advancement is less than what you would get in the long run if you take regular payments. Also, while you're expected to use the lump sum on the approved expenditure, it's ultimately up to you to use the money responsibly. If you know you're better off with a steady, reliable income stream for years to come, you probably shouldn’t apply for an LSA, even if you're qualified.

Discuss Your Options With a Workers’ Comp Attorney

The purpose of workers’ comp benefits is to pay for medical treatment and replace lost wages due to a job-related injury. When you're awarded permanent total or permanent partial disability benefits and have immediate financial needs, you must make decisions about how to receive those funds. If you need help weighing the pros and cons, contact Monast Law Office for advice. You can learn more about Ohio Worker’s Compensation by requesting a free copy of my book, The Worker’s Guide to Injury Compensation in Ohio

 

James Monast
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Fighting for Ohio’s Injured Workers and their Families