How Much of My Injury Settlement Goes To Pay Case Liens? It Depends on the State and Your Attorney
Posted on Wednesday, March 4th, 2015 at 11:51 am
Most people think that a lawsuit ends when the case is settled or the jury gives its award following a trial. Even many lawyers believe this, and that is how you spot an attorney that doesn’t have any business practicing personal injury law. In truth, a great deal of negotiating with lienholders follows the jury’s verdict or case settlement. In the last twenty years, many laws have been passed that favor insurance companies at the expense of injured American citizens, and some of these laws sharply reduce the net amount of a settlement or judgment. Case liens can come from a great many sources, but the vast majority are related to medical bills in one way or another. The amount of money that has to be paid to these medical lienholders varies by state and by the kind of company asserting the lien. Differing state philosophies is most easily shown by looking at the Greater Cincinnati area.
Greater Cincinnati Case Lien Process
If you get injured in Southern Ohio, you fall under the Ohio state rule. That rule says that you can only recover medical damages in a lawsuit up to the amount that your insurance company actually paid to the medical provider. This is a bad rule, because it requires the injured person to go the trouble of proving liability and recovering the money, but allows a free-riding insurance company to get all the money back. In the meantime, the person or company that was liable gets a break by not having to pay the full amount of the medical bills!
Northern Kentucky Case Lien Process
Kentucky allows you to claim the full amount of your medical bill at trial and, after proving the other party liable and collecting the damages, you only have to pay the insurance company the exact amount they paid toward the bill. The injured person keeps the rest. The Northern Kentucky rule decides that a liable person or company should not get a break on the amount of damages they caused, although it does still allow most insurance companies to free-ride. The Northern Kentucky rule also wisely reasons that any extra money kept by the injured person is justly due, because the injured person paid the premiums to the insurance company in the first place!
The Type of Organization Issuing the Lien Matters
The type of company putting a lien on the case is a big factor is how much the lien can be reduced. Government agencies like Medicare and Medicaid absolutely must be paid back, but they are often willing to negotiate a much lower payback than 100%. On the other hand, health insurance plans created under ERISA (which basically includes every health insurance plan that comes through your or your spouse’s employment) must also be paid back and they are generally unwilling to reduce their lien by more than a token amount. Actual medical providers, such as hospitals and ambulance companies, should be paid out of a lawsuit although it is more of an ethical rather than a legal requirement. (Still, if you don’t pay them they will likely sue you for the payment.) Medical providers do not have the same legal protections that insurance companies do, and they generally charge uninsured patients at an inflated rate compared to what they would charge an insurance company. Therefore, medical providers are generally willing to take a big reduction on their lien to ensure getting paid.
A Good Personal Injury Attorney Will Look at the Whole Picture When Working Toward a Settlement
A good Northern Kentucky Personal Injury Attorney will determine whether your case should be settled or go to trial and should include not only the client but all the lienholders as well. A Personal Injury Lawyer should make everyone agree to reduce their liens by a certain amount based on whatever settlement offer is on the table. That way, you will always know exactly what to expect out of a given settlement, and never get an unpleasant surprise after the settlement negotiations are over. Some Northern Kentucky attorneys don’t give their clients this “whole picture” approach to a settlement, and their clients should justifiably be upset if they find out their settlement netted less money than they expected.
At Lawrence & Associates, we have negotiated thousands of liens and recovered millions of dollars for our clients. We’re Working Hard for the Working Class, and we’d be proud to represent you.
Contact Us (859.371.5997) for a Free Consultation