When considering the amount of compensation you can expect from a personal injury lawsuit, you must consider the repayment of medical debt. The purpose of most personal injury lawsuits is to recoup the financial losses incurred for medical treatment and the loss of property due to an injury that another party is responsible for.
A medical lien grants medical care providers the right to compensation should a patient be awarded damages or agree to an out-of-court settlement. In many states, this right is guaranteed by law in order to protect those who provide medical services to those who may not be able to afford them.
What Is a Medical Lien in a Personal Injury Case??
A medical lien is a secured interest in any compensation that you may receive in or out of court when you bring a lawsuit against another party for damages. Hospitals and physicians have the legal right to a portion of any damages you receive to pay for any services that were rendered on the condition of repayment at a later date.
Liens are often held against patients who are unable to afford medical care but are involved in an accident that requires immediate treatment. Medical liens are not always guarantees of payment, however, as they are contingent on the patient winning their case or receiving some form of settlement.
When are Medical Liens Necessary?
Patients are given the choice to pay their medical bills up front or through their insurance companies or to have the cost taken from any compensation collected through a personal injury lawsuit. If you are injured and have paid your medical bills, no further payment to your medical provider is needed, but if you were unable to afford the cost of treatment and elected for a medical lien instead, your debt must be satisfied if you receive compensation. If your insurance coverage is not enough to cover the cost of treatment, the medical provider may have the right to a lien on the outstanding balance.
Why Medical Liens Are a Risk to the Medical Care Provider
Hospitals and physicians prefer timely payments and have a severe distaste for medical liens because there is absolutely no guarantee of payment and it can be a very long time before the medical debt is paid. For this reason, it is often possible to negotiate with providers in exchange for more timely payment in lieu of a medical lien. Your personal injury lawyer will make every effort to reduce your financial burden both by seeking the most compensation allowed by law and communicating with your debtors to make arrangements that are in your best interest.
The Role of Insurance Companies
It is not uncommon for insurance companies to make arrangements with medical providers to provide services at a discounted rate. An example of this would be if the responsible party’s insurance company makes an arrangement to reduce the amount of the bill by 25% in exchange for immediate payment. Medical providers will elect to accept these agreements because the legal process for many cases takes years and there is no guarantee that a patient will receive compensation. In the event that such an arrangement is made, the patient will not be held responsible for the remaining 25%.
What is the Impact of Medical Liens on Settlements?
Once a settlement is accepted or a court awards the injured person with damages, the medical providers have a right to collect on their debts. The cost of your treatment will be deducted from any damages that you receive, and in the event that this is not sufficient to repay your debt, it can be possible to negotiate with the hospital or physician in order to come to a more amicable arrangement. Our attorneys make every effort possible to negotiate with these providers both before and after you’ve received compensation so that we can minimize your costs in order to ensure that you do not need to experience any undue financial hardship.
Impact of Insurance Payments on Medical Liens
Compensation provided in a settlement or as the result of a judgment may come from the responsible party’s insurance company. Your own insurance company may contribute as well, and any insurance payments will reduce your own financial responsibility. Working with insurance companies is an essential part of any personal injury case to satisfy any outstanding medical debt that must be paid upon the receipt of damages.
The Impact Your Lawyer Can Have on Your Medical Liens
Our attorneys have extensive experience working with medical care providers and insurance companies, and we may be able to limit your financial responsibility in order to maximize the amount of compensation you are able to receive once your liens have been satisfied. It is important to remember that these companies and providers are very flexible because they do not wish to wait years for payment and the use of medical liens poses a risk to the providers because there is no guarantee that the patient will receive any compensation at all.
If you have been injured in an accident and have questions about your rights or the legal process, contact us today to arrange a risk-free consultation with one of our attorneys. We will be happy to review the details of your case and guide you through the steps needed to recover both physically and financially. If for any reason we are unable to help you or cannot collect on your behalf, our services are free of charge.