Opinion ID: 1668532
Heading Depth: 1
Heading Rank: 3

Heading: Workers' Compensation Credits.

Text: Iowa Code subsection 85.38(2) provides in part: 2. Credit for Benefits Paid Under Group Plans. In the event the disabled employee shall receive any benefits, including medical, surgical or hospital benefits, under any group plan covering nonoccupational disabilities contributed to wholly or partially by the employer, which benefits should not have been paid or payable if any rights of recovery existed under this chapter, ... then such amounts so paid to said employee from any such group plan shall be credited to or against any compensation payments, including medical, surgical or hospital, made or to be made under this chapter.... (Emphasis added.) Erbe argues a credit to or against workers' compensation payments may be made only if the benefits paid under the group plan should not have been paid. Because payments under the group plan were properly made, he urges no credit should be allowed. He claims the group plan, as stated in the policy, specifically allows only the workers' compensation benefits paid for loss of time to be deducted from the total disability payment. Since the workers' compensation award to Erbe is for permanent partial disability, not for loss of time, he urges the State is not entitled to a credit. The State argues Iowa Code section 79.20 establishes the terms of the group plan, and under the statute's terms the monthly disability benefits are reduced by any workers' compensation payments, including payments for permanent partial disability. Because no deduction was taken for the workers' compensation payments, the State claims Erbe received disability benefits that should not have been paid to him. Therefore, the State urges credit against the unpaid partial disability award is allowed. To resolve this issue we must review the state employee disability program.