Virginia HB426 Will Change How Employers Apply Third-Party Recovery Credits
Third-party recoveries have long been one of the more consequential pressure points in Virginia workers’ compensation claims. When an injured worker obtained a recovery from a negligent third party arising out of the same accident, employers and carriers could rely on Code § 65.2-313 to obtain a meaningful offset against future workers’ compensation exposure. HB426 changes that framework in a significant way. Beginning July 1, 2026, the employer’s credit remains, but the practical benefit of that credit will be reduced because ongoing medical and indemnity benefits are no longer treated the same way during the offset period. Under the current...
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