In handling a third-party case, which outcome aligns with protecting the employer's financial interests?

• A. Maximizing the employer's recovery
• B. Reducing the claim
• C. Delaying the case
• D. Settling quickly

Answer: (A)

In handling a third-party case, the central idea is subrogation: the self-insurance plan pays the employee’s claim upfront and then seeks reimbursement from the party legally responsible. Maximizing the employer’s recovery is the best approach because it directly lowers the plan’s net outlay by recouping as much as possible from the liable party or their insurer. This preserves funds for future claims and helps keep overall costs under control for the employer.

Delaying the case can increase costs and risk losing potential recovery, and settling quickly may protect short-term cash flow but often leaves unrealized larger recoveries on the table. Reducing the claim itself isn’t the same as maximizing recovery from the third party; it’s about the amount the plan pays, whereas maximizing recovery focuses on the total amount reclaimed from the responsible party.