How to Determine Whether You Need to Pay a Medical Lien or Reimbursement on Your Accident
Find out What Entity Paid Your Medical BillsThere are many possible sources that will pay medical bills. Amongst them are the client's own med-pay insurance from their auto policy, a health insurance policy through work also known as an ERISA plan, a self paid health insurance plan, Medicaid or Medicare, or CHAMPUS (Civilian Health and Medical Program of the Uniformed Services) or the V.A. Occasionally, clients will sign a medical lien with a Dr. or chiropractor.
Although it is not well known, many times insurers have standard language in their health insurance policies that gives them the right to reimbursement if they pay your accident bills and then you recover from a third party.
Medicare, Medicaid and CHAMPUS may demand reimbursement based on a federal statute.
Look at the bills they paid and make sure they are accident related. Many times insurers ask for reimbursement for bills totally unrelated to your accident.
Require Verification and Consult with an AttorneyIn every case, if an entity requests reimbursement, you should ask them to point out to you the language in the insurance policy or public statute that gives them that right. Get a copy of the policy or statute and read it.
Lien law is very complicated and new legal cases can change it almost daily.
An attorney experienced in lien law may well find ways to reduce or eliminate the lien asserted even if the face of language in an insurance policy or statute that gives the entity the right to recover. In many cases, an attorney may even eliminate the lien entirely.
This can be very valuable. Let's say you have a case that settles for 100,000, the attorney fees are 33,000, and there are medical bills of 200,000 . An attorney can often perform a valuable service by reducing the lien drastically or eliminating it altogether. If he gets the insurer to waive it, you could save 66,000 or so on a case where the lien would otherwise consume the entire recovery.