Q: What is the difference between a Compromise and Release and a Stipulation?
There are two basic settlement options available to you. The first is a “Stipulation” or “Stips”; the second is a “Compromise and Release” or “C&R”. If you return to your old job, you usually do not have the option of a C&R. There can be exceptions if your employer was insured under two or more insurance carriers while you were working there. If you are not returning to your old job, you have both options open.
A stipulation leaves an injured worker’s rights to medical treatment open based on the description of future medical treatment by the AME, PQME or treating physician. You also have the right to “reopen” your case within five years of the date of your injury for “new and further disability”. Your permanent disability will be paid to you at a weekly rate over time. This can take months to years depending on the level of disability.
In a C&R you will receive a lump sum settlement for permanent disability and future medical treatment. The carrier usually pays a premium for an employee’s rights to future medical treatment and their rights to reopen. It is usually unwise to do a C&R if you are looking at significant future medical treatment and you do not have any insurance coverage. There are ways to get insurance coverage through group plans in California that cover preexisting conditions. These issues need to be handled on a case-by-case basis to make sure that the coverage is available to you. In any event, it is a decision that needs to be made at settlement time.