Assuming that my health insurance paid out $100,000 in medical expenses beyond my deductibles and I am awarded $200,000 as a settlement for the case, will/would the health insurance company claim a portion of the settlement amount?
Yes, in most cases the health insurance company has what is called a subrogation interest in the proceeds of a personal injury claim if the medical benefits were paid by the health insurance company. In some cases the insurer will compromise the amount of their subrogation interest. By the same token, the insurer is responsible for paying a proportionate share of your costs in obtaining the settlement, such as attorney fees and legal costs. You also want to be sure that only accident related expenses are included in the health insurance lien and that things like routine medical care or other unrelated expenses as the insurance company cannot recoup those costs from your settlement.
This is a complicated area of the law. If you don't already have an attorney, you may want to consult with one to help you work through this issue.
Best of luck to you as you resolve your case. Please call me if you have questions.
Susan J. Holm
Leonard W. Moen & Associates
947 Powell Ave SW, Suite 105
Renton, WA 98057
425-227-4260
[email protected]
Disclaimer: Please note that this answer does not constitute legal advice. It is merely intended to provide general information to aid the poster in finding answers to the problem posed. This answer does not create an attorney-client relationship. In most cases, it is best to contact an attorney directly to find answers to your problems.
It depends on what your policy with the insurance company says. It is based on contract law. If there is a reimbursement provision in the policy, you would likely have to reimburse them. However, the amount could be reduced if you have an attorney under the common fund theory, which means that is reduced for attorneys fees and their proportionate share of the costs incurred in obtaining the settlement. Depending on what kind of policy it is, you may also be able to reduce further if you were not made whole from the settlement. Consult with an attorney in your area for specific law on this issue in your jurisdiction.
Most health insurance companies have a right of third party recovery provision solidly embedded in the policy. Therefore, when you are injured in an accident and the health carrier pays, they want their money back through 'third party recovery'. You need to explore whether there is any other coverage to help satisfy the lien, coverage such as 'PIP' in some states or 'medpay'. Finally, as a personal injury attorney, my office spend literally hours negotiating with health carriers to determine whether all of the claimed medicals actually relate to the accident and also to reduce the lien. This is one of the reasons one should never do a personal injury claim without an experienced attorney. Personal injury attorneys nearly always give a free initial consultation.
The insurance industry’s own statistics indicate that once an attorney becomes involved, the value of any claim at least doubles.
Put those two facts together and it is in your best interest to retain experienced legal counsel at your earliest possible convenience.
I truly wish you the best.
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This answer is offered for informational purposes only. It is not offered as, and does not constitute, legal advice. Laws vary widely from state to state. You should rely only on the advice given to you during a personal consultation by a local attorney who is thoroughly familiar with state laws and the area of practice in which your concern lies.
Lars A. LundeenPersonal Injury LawyerRutland, VT ·
I am sure that your health insurance company will attempt to collect a portion of your settlement under their subrogation clause in your health insurance contract. However, depending upon the insurance contract language and whether or not it is a ERISA policy, your attorney may have a number of defenses against their lien claim. You need to discuss this in detail with your attorney. If you do not have one, you need to get one before you settle the claim and deal with your liens.
Legal Disclaimer :
Mr. Lundeen is licensed to practice law in Florida and Vermont. The response herein is not legal advice and does not create an attorney/client relationship. The response is in the form of legal education and is intended to provide general information about the matter within the question. Oftentimes the question does not include significant and important facts and timelines that, if known, could significantly change the reply and make it unsuitable. Mr. Lundeen strongly advises the questioner to confer with an attorney in your state in order to ensure proper advice is received.
Jason Garrett EpsteinCar / Auto Accident LawyerSeattle, WA ·
Well, I guess you will only get an answer from one Washington Attorney. I am licensed in Washington. My main office is in Bellevue.
In general you have do have a duty to reimburse your health insurance company when you recover from the at fault party. This process is called subrogation. Typically there is a lot of room to negotiate on these issues as long as the plan is not an ERISA based plan.
If it is an ERISA plan then the everything changes. The law is currently in flux with ERISA, and it may be the case that they are actually entitled to a dollar for dollar reimbursement for what they paid. Currently the federal law is unclear in this area.
The bottom line is that you should speak to a local attorney to help you sort through these issues. Best of luck.
Robert Kevin DawsonInsurance Law LawyerSeattle, WA ·
Your health insurance will likely claim a portion of the settlement. They want the money they paid for your health care back if they can get it. Whether the health insurer is entitled to any money back depends on the wording of their contract, the law applicable to your specific legal claim, and the amount of insurance the at fault party has. The health insurer may be entitled to a large portion of the settlement, or nothing. It depends on facts that you haven't set forth in your question.
Another thing you might want to think about. Is it in your interest to settle a claim with over $100,000 in medical bills for $200,000? The medical bills alone suggest you sustained a serious injury, perhaps one that is permanent. The settlement amount sounds low.
Good luck.
