incapacity payments

Offsetting compensation paid as a lump sum

Compensation offsetting of Disability Compensation Payments due to lump sums

The offsetting of a Disability Compensation Payment resulting from other compensation is not based on repaying the lump sum.  The fortnightly equivalent amount represents a return of the lump sum plus interest over the course of a person’s actuarially calculated life expectancy.

Fortnightly incapacity payments redeemed under section 30 of DRCA (redemption under DRCA)

Permament Impairment payments and incapacity payments are also subject to compensation recovery.

MRCA s.401(2) Recovery

Where damages are received in respect of the same cause of action, (i.e. from the same injury/disease arising out of the same event) for which MRCA compensation is payable, Section 401(2) requires the person to repay to DVA the amount of compensation, including treatment costs, paid by the Department in relation to that cause of action.

Particular care should be taken when offsetting incapacity payments paid under the DRCA or MRCA.

Incapacity payments compensate a client for the loss of earning capacity (economic loss). Incapacity payments are generally paid for one condition.  However, several compensable conditions may contribute to the member's incapacity for work.