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Does medicaid take their money out before you get your check from court?

Leeds, AL |

I was in an car accident, was on medicaid, but thought the other persons (who is at fault) paid that. Why is medicaid jumping in and then making me pay back medicaid? Medicaid I thought was for your benefit and didn't have to pay back.

Attorney Answers 8


  1. My guess is that Alabama is similar to California. Here there is a statute that says you must reimburse Medi-Cal (our version of Medicaid) out of any liability insurance settlement (including uninsured motorist). There are limitations on how much they can take, for instance, they can take no more than 1/3 of your settlement and if there is a reason that a further reduction is warranted, your attorney can make the argument to Medicaid so you receive more of the settlement funds.

    Good luck.


  2. I agree with my colleague. Same situation in New York and New Jersey. You are responsible to pay back Medicaid. They wont automatically take it out of your settlement. It must be considered when settling. Good luck.

    The above is general information only and is not legal advice. The information provided does not form an attorney-client relationship, and should not be relied upon to take or refrain from taking any action. I am not your attorney until we sign a retainer agreement.


  3. Medicaid is a Federal benefit. They have very strict rules with respect to repayment of monies expended for billings related to 3rd Party claims. You really should talk with an attorney. If you do not repay Medicaid, you could have some future issues.


  4. Discuss with your car accident attorney whether Medicaid has a lien against the proceeds of any third party negligence claims recovering the medical costs paid by Medicaid. Medicaid can assert a lien or have a lien by statute in some states. This should be a consideration you and your automobile accident lawyer take into accout prior to settlement, not after. Obviously, this affects your net settlement.

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  5. In Alabama yes. They paid your bills, they have a right to get their money back.

    The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The response does not form an attorney-client relationship, nor is it intended to be anything other than the educated opinion of the author. It should not be relied upon as legal advice. The response given is based upon the limited facts provided by the person asking the question. To the extent additional or different facts exist, the response might possibly change. Attorney is licensed to practice law only in the State of Alabama. Responses are based solely on Alabama law unless stated otherwise.


  6. Medicaid does have certain reimbursement or subrogation rights due to its payment of your medical bills. However, they are really very limited under Alabama law. Many attorneys fail to understand these limits and simply accept what the agency tells them it will take in compromise for its claim. In some cases, I have found it better to address the issue with the court. If you are significantly injured and dealing with substantial medical bills, I would urge you to consult an attorney who truly understands the issues involved in a Medicaid lien in Alabama.

    The issues surrounding medical liens are complicated. Medicaid, Medicare, and private insurance, all have different legal rights under the law. This is an area where a knowledgeable lawyer can really make a big difference in how much money you are able to keep in a settlement. It is also an area where many lawyers fail to fully maximize their client's recovery.

    No representation is made that the quality of legal services to be performed is greater than legal services performed by other lawyers.


  7. Yes, if you are a Medicaid beneficiary, that means your medical treatment gets paid for by Medicaid, a state/federal benefit program. If someone else caused that medical treatment to be necessary, then Medicaid gets to get paid back from that at-fault person. The Medicaid beneficiary is responsible (as well as others) for seeing to it that Medicaid gets paid back, for after all, the beneficiary (here, you) didn't have to pay anything. Generally Medicaid only gets paid back if there is an at-fault party able to pay a settlement or judgment--that is, the at-fault party has insurance or assets. So, be glad you got your bills paid and you're not looking at an unpayable hospital bill, and give unto Medicaid what is Medicaid's!

    The Alabama Rules of Professional Responsibility direct that I state that no representation is made herein that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers. ALSO: Be advised that our discussion here does not in any way establish an attorney-client relationship.