Were you injured in an accident caused by the negligence of another party? If so, you have the right to seek compensation for your damages through a personal injury claim. Compensation can include medical bills, wage loss, pain and suffering, and more. You may be wondering: Will my health insurance provider try to claim my personal injury settlement? The short answer is “it depends”—though a health insurer may absolutely try to do so to seek a reimbursement for accident-related expenses they paid. Within this blog post, our Stockon personal injury lawyer explains the key points to know about your health insurance company’s right to claim a share of your personal injury settlement.
Insurance Providers Can Seek Reimbursement for Expenses Actually Paid
Here is the most important thing that you need to know about the rule in California: A health insurance provider can seek reimbursement from your settlement or judgment for expenses that they actually paid related to your accident. Medical bills are a big part of any personal injury settlement. When you get one, you should be prepared for your health insurance carrier to try to get reimbursed. It is a process called “subrogation.” Here are key things to understand about personal injury settlements and subrogation with different types of insurance coverage:
- Private Health Insurance Company: Private health insurance policies often include subrogation clauses that allow the insurer to recoup the costs they paid for your medical treatment from any third-party settlements or judgments you receive. If your insurer has a right of subrogation, they may place a lien on your settlement. A key point to know about dealing with private health insurers is that there is often some room for negotiation.
- Medi-Cal Coverage: Medi-Cal is our state’s Medicaid program. The California Department of Health Care Services (DHCS)reports that 40 percent of people in our state get their health coverage through Medi-Cal. By both federal law and state law, Medi-Cal is required to seek a full reimbursement for costs paid through subrogation. edi-Cal will place a lien against your personal injury settlement to recover costs related to your medical care.
- Medicare Coverage: If you are a Medicare beneficiary, federal law grants Medicare the right to recover funds from your personal injury settlement for medical expenses it covered. Medicare requires you to report any potential settlement, judgment, or award promptly. Failure to reimburse Medicare can result in significant penalties, including interest charges and legal action. Your Stockton personal injury lawyer can help you deal with Medicaid.
Understanding Subrogation and Personal Injury Claims in More Detail
Subrogation is a key term to remember when thinking about personal injury settlements and health care provider reimbursements. Broadly defined, subrogation is a legal concept where an insurance company steps into your shoes to recover the costs of medical expenses from the at-fault party. In personal injury cases, it means that after the victim receives a settlement, their health insurance carrier can claim a portion to reimburse themselves for the medical bills they paid. The process helps prevent double recovery—where the victim would otherwise benefit from both the insurance payout and the settlement for the same expenses.
You Should Make Sure Your Personal Injury Lawyer Knows Your Insurance
Subrogation is a notoriously challenging subject. It is highly technical. The good news is that you do not have to worry about the nuances. Let your Stockton, CA personal injury lawyer handle the small (but important) details. It is crucial to inform your personal injury lawyer about all your health insurance coverage, including private insurance, Medi-Cal, or Medicare. Your attorney needs this information to address any subrogation claims effectively. They can communicate with the insurance providers to negotiate liens and possibly reduce the amount you owe.
Two Big Limits on Subrogation in California
After an accident in California, many people worry that their health insurance company will try to take most (or all) of their settlement. It is an understandable concern—but there is good news. There are limits on subrogation of personal injury settlements in California:
- An Insurer Cannot Claim More that You Actually Received: Under the “Made Whole Doctrine” in California, an insurance company cannot recover more than the amount you receive from your settlement after deducting legal fees and costs. If your settlement does not fully cover your damages, including pain and suffering, lost wages, and medical expenses, the insurer may be limited or even barred from subrogation
- An Insurer Can Only Claim Money Designated for Medical Bills: California law restricts insurers to recovering only from the portion of your settlement allocated for medical expenses. They cannot seek reimbursement from amounts designated for other damages like pain and suffering or lost income. As an example, imagine that your health insurer states that it paid $10,000 in medical bills. You received a $10,000 settlement. However, $5,000 is for medical bills and $5,000 is for lost wages. California law limits your insurer to subrogating $5,000. It can only seek reimbursement for medical bills.
We Put More Money Into the Pockets of Injured Victims
Navigating the aftermath of a serious accident is not easy. One of the realities of personal injury claims is that you are likely going to need to deal with insurance companies. Your health insurance provider—whether a private company or Medi-Cal—may try to claim a share of your personal injury settlement when you get it. At Redkey Gordon Law Corp, we have helped injured victims recover more than $25 million in compensation. Our case results tell the story. No matter the situation, our team can help you take on the insurance companies.
Contact Our Stockton, CA Personal Injury Attorney Today
At Redkey Gordon Law Corp, our Stockton personal injury lawyers fight aggressively for justice. We are proud of our record of success in complex personal injury claims. Our team will help you navigate issues with insurance companies—including your own health insurance providers. Contact us now for a no cost, no strings attached case evaluation. From our law office in Stockton, our firm advocates for victims throughout the whole San Joaquin Valley region.