Quirky Workers Compensation case

Workers Compensation Assignment Restrictions and No-Fault Coverage Interplay

The intersection of workers’ compensation and New York No-Fault Insurance Law creates unique procedural challenges for eligible injured persons (EIPs) and their healthcare providers. Under Insurance Law section 5102(b)(2), workers’ compensation serves as the exclusive source of medical expense reimbursement when an injured party qualifies for such benefits. However, what happens when the procedural requirements for workers’ compensation claims are not properly satisfied, potentially disqualifying coverage that would otherwise apply?

This case addresses the strict limitations on workers’ compensation claim assignments under Workers’ Compensation Law section 33, and how these restrictions affect medical providers who receive assignments from injured patients. The Appellate Term’s analysis reveals important considerations about who must file claims, when they must be filed, and whether providers can cure procedural defects in workers’ compensation applications that were improperly assigned to them.

Case Background

Flatbush Chiropractic, P.C. v American Tr. Ins. Co., 2017 NY Slip Op 50105(U)(App. Term 2d Dept. 2017)

The medical provider sought leave to renew its motion after allegedly discovering new facts that would change the court’s prior determination. The insurer defended by arguing that workers’ compensation benefits provided the sole source of reimbursement, thereby precluding the no-fault claim. The procedural history involved questions about whether the injured worker had properly filed a workers’ compensation claim on the prescribed Board form within the two-year statute of limitations set forth in Workers’ Compensation Law section 28.

Jason Tenenbaum’s Analysis:

“A motion for leave to renew “shall be based upon new facts not offered on the prior motion that would change the prior determination” (CPLR 2221 ) and must “contain reasonable justification for the failure to present such facts on the prior motion” (CPLR 2221 ). We note that a claim for workers’ compensation benefits must be filed by the injured worker on a particular Board form within two years after the date of the accident (Workers’ Compensation Law § 28) and may not be assigned (Workers’ Compensation Law § 33). Plaintiff did not demonstrate that its assignor had made a proper application for workers’ compensation benefits (see A. B. Med. Servs., PLLC v American Tr. Ins. Co., 34 Misc 3d 141, 2012 NY Slip Op 50076 ).”

Assume a decision comes out from the court stating that the EIP must make a prompt application to the board, the EIP does this and has the claim is denied due to failing to comply with WCL 28. Would no-fault then be on the hook since there is no WC available, albeit due to the actions of the Assignor? See 11 NYCRR 65-3.12(a)(9)(“Pursuant to section 5102(b)(2) of the Insurance Law, when the applicant is entitled to workers’ compensation benefits due to the same accident, the workers’ compensation carrier shall be the sole source of reimbursement for medical expenses.”)

Legal Significance of Assignment Prohibition

The court’s holding reinforces the fundamental principle that workers’ compensation claims are personal to the injured worker and cannot be transferred to healthcare providers or other third parties. This prohibition under Workers’ Compensation Law section 33 serves important policy objectives, including preventing trafficking in claims and ensuring that workers maintain control over their own compensation proceedings. The two-year filing deadline under section 28 operates as a statute of limitations that medical providers cannot circumvent through assignment.

This ruling has broader implications for the coordination of benefits between workers’ compensation and no-fault insurance systems. When an injury arises from a motor vehicle accident that also involves a workplace context, determining which system provides coverage requires careful analysis of whether proper workers’ compensation procedures were followed. The assignment restriction means that providers cannot substitute themselves for injured workers in navigating workers’ compensation filing requirements.

Practical Implications for Attorneys and Litigants

Medical providers and their counsel must recognize that they cannot cure defects in workers’ compensation claim filings through assignment. If an injured patient failed to timely file a workers’ compensation claim on the proper Board form, the provider cannot remedy that defect by attempting to file on the patient’s behalf. This creates potential gaps in coverage when patients miss filing deadlines or fail to comply with procedural requirements, raising the unresolved question posed in this case about whether no-fault coverage might then apply.

Insurance carriers defending no-fault claims should investigate whether the injured person qualifies for workers’ compensation and whether proper claims were filed. If workers’ compensation would be the sole source of reimbursement under 11 NYCRR 65-3.12(a)(9), but the claim was never properly filed by the injured worker, carriers may have valid defenses. However, the interplay between failed workers’ compensation claims and no-fault coverage remains an evolving area requiring careful fact-specific analysis.

Related Articles

• Workers Compensation Defense in No-Fault Cases: Standing vs. Exclusion Analysis
• Why does a Malella defense survive an untimely disclaimer, while a workers compensation defense doesn’t?
• Strategic Decision-Making in Appeals: When Not to Fight Workers’ Compensation Rulings
• Workers Compensation Defense in No-Fault Cases: Specialized Expertise Required

Legal Update (February 2026): Since this 2017 post, Workers’ Compensation Law provisions regarding filing requirements, assignment restrictions, and coordination with no-fault benefits may have been subject to regulatory amendments or procedural modifications. Practitioners should verify current provisions under Workers’ Compensation Law sections 28 and 33, as well as any updates to 11 NYCRR 65-3.12(a)(9) regarding coordination of benefits between workers’ compensation and no-fault insurance coverage.