Ohio’s Top Court: Subrogation Law Unconstitutional

June 1, 2004

The Ohio subrogation law that requires employees to reimburse their employers for their workers’ compensation benefits expenses if they win a work-related, third-party lawsuit was ruled unconstitutional by the state’s supreme court last week.

The top court upheld a trial court ruling which said that Ohio’s subrogation law is unfair and discriminatory because plaintiffs who settle out of court aren’t required to reimburse employers, but plaintiffs who receive an award after winning in court are so obligated.

An appeals court affirmed the decision before it wound up before the Ohio Supreme Court, whose insurance-related decisions in recent years have been a matter of great concern to the industry. The decision applies to workers’ comp claims filed before a change in the law went into effect April 9, 2003.

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