How should lawyers’ fees in a settlement amount be reported?
Ideally, DWC would like to know the total amount of lawyers’ fees reported on a claim as well as the total settlement amount. Thus, lawyers’ fees in a settlement amount should be reported using two DNs and codes: using payment/adjustment code (DN85) 500 (Compromised Unspecified) and also using the paid to date code (DN95) 340 (Claimant’s Legal Expenses paid to date). In the example cited in the above FAQ, ideally the $1,000 in lawyers’ fees for the settlement would be reported in DN85, benefit type code 500 and would also be reported in DN95, benefit type code 340. Due to system limitations, if a claims administrator is only able to report lawyers’ fees in a settlement amount using one code, then DWC would prefer that these fees be reported under the settlement amount (under DN85, code 500). It is very important that DWC be able to aggregate the 5xx codes and obtain the total settlement amount.
