Reducing Medical Liens to Maximize a Client’s Personal Injury Settlement
Reducing Medical Liens to Maximize a Client’s Personal Injury Settlement
The car accident attorneys at the Piccuta Law Group recently obtained a $100,000 settlement on behalf of a client. The client was injured in a car accident when he was riding as a passenger. The driver of the vehicle he was riding in lost control and crashed into a tree. The collision was at a speed of approximately 60-70 miles per hour and the impact was severe.
The client was immediately injured. He exited the vehicle and laid on the ground. His lower back was in so much pain that he could not walk or even move. He recognized he had suffered a serious spinal injury.
Emergency personnel were called to the scene and transported the client to the nearest trauma center. A trauma alert was called in to the hospital before the client’s arrival. The client was administered morphine while he was transported by ambulance because his pain was so severe.
The Injuries Suffered by the Client in the Car Crash
Upon arrival at the hospital, the client underwent diagnostic tests. A CT scan of his spine revealed that the client sustained a spinal fracture. Specifically, the client had an unstable fracture of his L-1 vertebrae.
The L-1 vertebrae is the first vertebrae of the lumbar spine where it meets the thoracic spine. It is located in the mid-lower back region. The fracture was unstable as it was broken through the pedicle. The pedicle is the portion of the vertebrae that extends from the main body and connects the spinous process. The fracture also caused a 30% loss of height in the front of the vertebrae.
The client met with a neurosurgeon at the hospital. The neurosurgeon recommended surgery to stabilize the fractured vertebrae. The neurosurgeon wanted to perform a lumbar vertebrae fixation to prevent the broken bone from moving and causing neurological damage. He also wanted to restore the fractured vertebrae to its normal height.
The Extended Hospitalization and Resulting Medical Charges
The client was scared to proceed with the surgery. Instead, he opted for conservative treatment. Due to the extent of the injury, the client was not safe to be discharged home.
He remained hospitalized for ten days. During this time his condition was monitored and he received therapy. This included occupational therapy and physical therapy. He began attempting to walk with a walker and was fitted with a thoracic spine support brace. Eventually, his condition improved and he was cleared for discharge.
The client incurred significant medical expenses due to his hospitalization. His final bill was over $180,000. The client was a Medi-Cal recipient. Medi-Cal paid $40,000 to satisfy his hospital bill.
The Additional Medical Expenses
The client had a long road to recovery. Ultimately, it took him over eighteen months to improve. During this time, the client underwent various therapies. This included water assisted physical therapy among other treatments.
The medical treatment he received over the course of that eighteen months was significant. The client incurred approximately $60,000 more in medical expenses. Medi-Cal paid an additional $41,620 for these treatments.
What is Medi-Cal?
Medi-Cal is California’s state Medicaid. It is government provided and subsidized health insurance. It is needs based and not everyone qualifies for it. Typically, individuals under a certain earnings threshold may apply for it and receive it.
The Basic Rules for Medical Providers That Accept Medi-Cal
There are a series of complicated rules that medical providers who accept Medi-Cal must follow.
However, the two most basic rules that apply to personal injury cases are:
- If a medical provider agrees to accept Medi-Cal, the medical provider is obligated to bill and accept a patient’s Medi-Cal insurance once it is presented to the provider.
- Once a medical provider bills Medi-Cal and is paid by Medi-Cal, they must accept Medi-Cal’s payment and may not pursue the patient to pay the remaining balance.
Medi-Cal’s Personal Injury Lien or Reimbursement Right
Medi-Cal has a reimbursement right under California state law if a patient receives a personal injury settlement. In sum, a patient must pay back Medi-Cal any medical expenses it paid for treatment related to an injury where the injured individual recovers a settlement from a third party. This reimbursement right is often referred to as a medical expenses lien, a health insurance lien or a personal injury lien.
This is not exclusive to car accidents. It also applies to slip and fall claims, product liability claims or any other claim where the client is receiving a settlement from a third party responsible for causing the injury. Under state law, a Medi-Cal recipient is required to report any claim he or she has where a third party could be liable.
The laws that set forth Medi-Cal’s reimbursement or lien rights are contained in California’s Welfare and Institutions Code. The department that is responsible for tracking the lien and collecting the payment is California’s Department of Health Care Services. If a client has an attorney and receives a settlement, the amount the client must pay back Medi-Cal is automatically reduced to account for the attorney’s work.
Medicare’s Reimbursement or Lien Rights
The medical expense reimbursement or lien rights discussed above are not exclusive to Medi-Cal. Medicare also has a lien and reimbursement right. Medicare is health insurance provided by the federal government. It is available for individuals over 65 years of age who qualify or for individuals of any age who meet certain needs based criteria.
Like Medi-Cal, Medicare has a department that tracks medical reimbursement liens and collects payments. The Center for Medicare and Medicaid Services has a specific department responsible for this. The department is the Coordination of Benefits and Recovery division.
Similar to Medi-Cal, Medicare also provides automatic deductions for qualifying cases if a person is represented by an attorney. Again, this is to account for the attorney’s work on obtaining the personal injury or third-party settlement. This amount is codified under federal law but can change depending on aspects of the claim.
Other Health Insurance Reimbursement or Lien Rights
Many private health insurance plans also have a medical expense reimbursement or lien right. This is set forth in the health insurance policy or health services agreement. These provisions are usually referred to as subrogation provisions or reimbursement provisions. They are usually found toward the end of the health insurance services agreement.
They simply state, that in the event a person is injured and receives medical treatment paid for by the health insurance plan, they have to pay the plan back from any settlement obtained from a third party. In essence, the reimbursement or lien rights that a private health insurance plan asserts usually mimic the reimbursement rights of Medi-Cal or Medicare. However, depending on the language in the health services agreement, the reimbursement right may be challenged.
Why Reducing Health Insurance Liens Is Important in a Personal Injury Case
Reducing health insurance liens and medical expense reimbursement rights is a critical part of a personal injury case. It is as important as obtaining the settlement. In some cases, reducing the health insurance liens are more important than obtaining a high settlement amount.
In some cases, reducing the health insurance liens are more important than obtaining a high settlement amount.
This is because every dollar reduced on a health insurance lien directly benefits the client. Every dollar a health insurance lien is reduced goes directly into the client’s pocket. In cases where there are serious injuries and limited insurance, obtaining the settlement is not difficult. The real value in hiring a personal injury attorney, in that situation, is his ability to reduce and negotiate down the health insurance liens.
Not All Attorneys Know How to Successfully Reduce Health Insurance Liens
The better your attorney is at reducing health insurance liens the greater a client’s personal injury payout will be. Many attorneys are unfamiliar with the laws that apply to reducing health insurance liens. They do not know the processes and how the health insurance liens may be negotiated down.
Many attorneys simply do not care about this process. After all, it requires more work and does not increase the attorney’s fees earned. It only benefits the client. Some attorneys, who just go through the motions and run a volume practice, may not even care about maximizing the payment the client receives.
Our Attorneys Are Experts in Reducing Health Insurance Liens
Our personal injury attorneys specialize in reducing health insurance liens. With respect to both Medicare and Medi-Cal liens, we have obtained significant reductions several times greater than what is required under law. With respect to private health insurance liens, we have been successful in reducing those liens as well. In some cases, we have even received full waivers where the health insurance company agrees to accept zero in repayment.
We Reduced the Client’s Health Insurance Lien by Over $70,000
Circling around to the client who we discussed at the beginning of this post, we were able to reduce his Medi-Cal lien by over $70,000. Medi-Cal had paid over $81,620 in his crash-related medical treatment. Because he had an attorney, Medi-Cal provided an automatic statutory reduction lowering its lien to $62,465.
However, if the client was required to pay Medi-Cal $62,465, he would have been left with very little of the settlement funds. That would have been a horrible result for the client and we would have served no purpose—other than to collect money and take a cut. Those are not the kind of attorneys we are.
We aggressively started working on reducing his Medi-Cal lien. We presented numerous arguments to Medi-Cal, performed legal research and looked at similar injury recoveries. Eventually, after several months of back and forth with Medi-Cal, we were able to obtain an additional reduction of $50,000. This required a specialized showing under the law, but we spent the time to do it.
Ultimately, we negotiated the Medi-Cal lien down to $11,430. The total reduction received was over $70,000. This allowed the client to receive the majority of his settlement. The client was thankful and satisfied. He left us a five-star review on google after receiving his check.
Contact a Skilled Personal Injury Attorney Today
If you or a loved one suffered serious injuries due to the fault of another, contact the experienced personal injury attorneys at the Piccuta Law Group today. Our accident lawyers know the ins and outs of the claims process. If you have significant medical expenses, we can assist with reducing these repayment obligations to make sure you receive the most possible from your settlement. A consultation is free and we only earn a fee if we recover for you. A lawyer is available now to discuss your case.
About the author: The content on this page was written by California personal injury attorney and civil rights lawyer Charles “Tony” Piccuta. Piccuta graduated with honors from Indiana University-Maurer School of Law in Bloomington, Indiana (Previously ranked Top 35 US News & World Report). Piccuta took and passed the State bars of Arizona, California, Illinois and Nevada (all on the first try). He actively practices throughout California and Arizona. He is a winning trial attorney that regularly handles serious personal injury cases and civil rights lawsuits. He has obtained six and seven figure verdicts in both state and federal court. He has been recognized by Super Lawyers for six years straight. He is AV Rated by Martindale Hubble. He is a member of the Consumer Attorneys of California, American Association for Justice, National Police Accountability Project, Arizona Association of Justice, and many local county and City bar associations.
Disclaimer: The information on this web site is attorney advertising and is for informational purposes only. It does not constitute legal advice. Reading and relying upon the content on this page does not create an attorney-client relationship. If you are seeking legal advice, you should contact our law firm for a free consultation and to discuss your specific case and issues.
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