Health Insurance Liens

One of the biggest problems in personal injury practice these days is trying to figure out the liens that health insurance, Medicare and Medicaid might claim against a recovery.  This is called the right of subrogation.
Let’s take a recent case as an example.  Our client had medical bills of about $2,000 that her health insurance paid.  Her health insurance policy had a provision that gave the company the right to be paid back that $2,000 out of any recovery.   But Virginia has a statute that says that certain kinds of insurance policies do NOT create the right of subrogation, despite what they may say in the policy.  Case closed?  No, because the federal statute governing ERISA employment benefits takes precedence over state statutes.  Case closed?  No, because not all health insurance qualifies under ERISA.  So we worked through the insurance policy, and state law, and federal law, and the exceptions to the federal law, and that’s before we looked at the role of Medicare or Medicaid.   In this case, we agreed that her health insurance company had a right to be repaid, but they were seeking repayment of about 3 times the bills that were related to the accident, because when she had gynecological care during the time that she was seeing a chiropractor and a physical therapist for the pain from her injuries, the health insurance company wanted us to repay those unrelated expenses as well.  We negotiated with them to get a resolution that was fair to all.

This is an extremely complex area right now, and there is basically no way that a non-lawyer will be able to make his or her way through this thicket.  Call us at 434-293-8185, and let’s see if we can help you.