Work comp: Recovering benefit overpayments

If voluntary payments to an employee or an employee's dependents are received in good faith, the insurer is not entitled to a refund if it is later determined the payments were made under a mistake in fact or law. If further benefits are owed for the same injury, the insurer is entitled to take a partial credit against future periodic benefits. The credit cannot exceed 20 percent of the amount of the future benefits that otherwise would be payable. Future periodic benefits from which the insurer can take a credit include, but are not limited to, temporary total disability, temporary partial disability, economic recovery compensation, permanent partial disability and permanent total disability. In situations where the employee is entitled to a lump-sum payment, the insurer can take a credit for the entire overpayment from the lump sum due to the employee.

If a compensation judge or the commissioner determines the compensation paid by mistake was not received in good faith, they may order reimbursement of the compensation. These instances occur if the payments are received by fraudulent means or if the employee knew the compensation was paid under mistake of fact or law. (See Minnesota Statutes 45.0135 and 60A.951 for the laws concerning fraud.)

The insurer cannot take a credit against medical expenses or penalty amounts payable to the employee.

See Minnesota Statutes 176.179.