Future Medical and Set-Asides 2025: Plan for Ongoing Care Costs

## Why Future Medical Care Changes the Calculation

For injuries that require ongoing treatment, the cost of future medical care can equal or exceed the cost of care already received. A serious injury might require future surgeries, continued therapy, medication, or long-term management. Planning for these future costs is essential, because a settlement that ignores them can leave you without funds for treatment after the case closes. Future medical planning also intersects with liens, particularly when Medicare interests are involved.

This article explains how future medical needs affect your settlement and liens, what a set-aside is, and how to plan so your recovery lasts as long as you need it.

Accounting for Future Medical in the Settlement

A proper injury settlement compensates you not only for past medical bills but also for the cost of care you will need in the future. To account for future medical:

1. Obtain **treating physician opinions** on the future care your injury will require.
2. Estimate the **cost of that care** over the relevant time period.
3. Include the **future medical component** in your damages and settlement demand.
4. Ensure the [settlement](/settlement) leaves funds to cover that future care.

Failing to account for future medical needs is one of the most damaging mistakes an injured person can make, because it can leave you without resources for necessary treatment after the case is closed. Your [attorney](/lawyer) should document and value future medical needs as part of building your claim.

What a Set-Aside Is

A set-aside is a portion of your settlement reserved to pay for future medical care related to the injury. The most common type is a Medicare Set-Aside, which reserves funds to pay for future injury-related care that Medicare would otherwise cover. The purpose is to protect Medicare interests by ensuring that the settlement funds, not Medicare, pay for future related care until those funds are exhausted.

Set-asides are most common in workers compensation cases but can also arise in liability cases. When a set-aside is appropriate, a portion of the settlement is allocated and administered to cover future care, and Medicare resumes coverage once the set-aside funds are properly spent down.

When a Medicare Set-Aside Is Needed

A Medicare Set-Aside is generally considered when:

• You are a **Medicare beneficiary** or reasonably expect to become one soon.
• Your settlement includes compensation for **future medical care**.
• The future care would otherwise be **covered by Medicare**.

In these situations, properly accounting for Medicare future interests protects you from later disputes. Failing to consider Medicare future interests when required can create problems down the road, including potential denial of Medicare coverage for related care. We address the Medicare conditional payment side in a dedicated article, but the future side is equally important.

How Set-Asides Are Funded and Administered

A set-aside can be funded and administered in different ways:

1. **Lump sum.** The full set-aside amount is funded at settlement.
2. **Structured.** The set-aside is funded over time through a structured settlement.
3. **Self-administered.** The injured person manages the set-aside funds and records.
4. **Professionally administered.** A third party administers the set-aside and tracks spending.

The set-aside funds must be used only for related future care and properly documented. When the funds are exhausted in accordance with the rules, Medicare resumes coverage for related care. Proper administration is essential to maintain the protection the set-aside provides.

Balancing Future Medical With Current Liens

Future medical planning must be balanced against current liens. Both compete for the same settlement fund. A settlement that fully satisfies current liens but leaves nothing for future care is not a good outcome, and neither is one that reserves future care funds but leaves current liens unresolved. The goal is a balanced resolution that:

• **Reduces current liens** as much as possible to free up funds.
• **Reserves adequate funds** for documented future care.
• **Protects Medicare future interests** where a set-aside is appropriate.
• **Leaves a reasonable net** for the injured person.

Achieving this balance requires careful planning, often with professional input on both the lien reduction and the future medical valuation. Review the applicable [statute](/statute) and program rules that govern these issues.

Structured Settlements for Future Needs

For injuries with significant future medical needs, a structured settlement can be a valuable tool. Instead of receiving the entire settlement as a lump sum, a structured settlement provides periodic payments over time. This can:

1. **Ensure funds are available** for future care when needed.
2. **Provide guaranteed income** for ongoing expenses.
3. **Protect against the risk** of spending the settlement too quickly.
4. **Fund a set-aside** in a tax-advantaged way.

A structured settlement is not right for every case, but for serious injuries with long-term needs, it helps ensure your recovery lasts as long as your care does.

Planning Before You Settle

The time to plan for future medical needs is before you settle, not after. Once the case is resolved and funds are distributed, it is too late to increase the settlement to cover future care. Before settling:

• Document **future medical needs** with physician opinions.
• Value the **future care cost** realistically.
• Determine whether a **set-aside** is appropriate.
• Reduce **current liens** to free up funds.
• Consider a **structured settlement** for long-term needs.

This planning ensures your settlement protects both your present and your future. Consult an experienced [lawyer](/lawyer) early to incorporate future medical planning into your case strategy.

The Bottom Line

Future medical needs are a critical part of any serious injury settlement. Account for future care in your damages, consider a set-aside to protect Medicare future interests where appropriate, and balance future medical funding against current lien reduction. A structured settlement can help ensure your recovery lasts as long as your care does. Plan before you settle, because once the case closes, the opportunity is gone. For help planning for future medical needs, consult an experienced [lawyer](/lawyer), review your [injury type](/injury-type), and see our [FAQ](/faq) for more.