Subrogation claims may be filed in your personal injury case by one or more insurance providers. Subrogation allows a party to assume the legal rights of another party.
In personal injury cases, subrogation claims often occur when health insurance providers pay medical bills from an accident. The health insurance company files a subrogation claim to recover that money from your personal injury settlement. Subrogation also includes the right to sue the party who caused your injury if you decide not to pursue a claim.
Your Responsibilities Under Subrogation Clauses in Insurance Policies
If you sustain an injury caused by another party, you may have the right to pursue a personal injury claim. You could be entitled to compensation for your economic and non-economic damages (i.e., pain and suffering).
However, resolving a personal injury claim could take months or even a year or more. During that time, you are responsible for paying medical bills and other costs associated with your injuries. If you have health insurance coverage, your health insurance company may pay your medical bills.
Most health insurance policies contain subrogation clauses. Depending on the terms contained in the subrogation clause, one or more of the following may apply:
- You may not be able to accept a settlement offer without your health insurance company’s agreement.
- You will need to cooperate with the insurance company’s subrogation efforts.
- You cannot sign documents or waivers stating your insurance company cannot receive reimbursement.
- Settlement agreements should not contain language or waivers that would prevent your insurance company from exercising its subrogation claims against the opposing party.
It is wise to have an attorney review a settlement agreement or document in a personal injury case before signing it. Insurance companies always act in their best interests, so they may try to include clauses and waivers that could cause problems.
How Does a Subrogation Claim Work in a Personal Injury Case?
When you reach a settlement with the at-fault party for your injury claim, your attorney will obtain approval from your health insurance provider, if required, to do so by the subrogation clause. You and the other parties sign the settlement agreement, and a check is issued to your personal injury lawyer.
Before your lawyer can disburse any funds from the settlement, they must pay outstanding medical liens and subrogation claims. Your attorney will verify all outstanding bills and confirm the amount owed on subrogation claims.
Medical providers and health insurance companies are not obligated to negotiate the amount of a lien. They are not obligated to take less than they are owed, even if the person receives a small settlement amount.
Attorneys are skilled negotiators. Your lawyer will attempt to negotiate a lower amount to satisfy the medical liens and subrogation claims. The lower the payoffs, the more money you receive from your settlement.
Do Subrogation Claims Apply to ERISA Health Insurance Plans?
Typically, Florida subrogation laws govern most of the situations that arise. However, federal subrogation laws apply if your health insurance is through an ERISA health insurance plan provided by your employer. There are some differences between state and federal subrogation laws, so let your injury lawyer know who provides your health insurance at the beginning of your case.
Are Medicaid and Medicare Payments Subject to Subrogation Claims?
Medicaid and Medicare payments are also subject to subrogation claims. Failing to repay a subrogation claim could jeopardize your health benefits. Therefore, it is crucial to handle these claims carefully and discuss them with your lawyer to protect your health benefits and comply with federal and state regulations.
Why Are Subrogation Claims Allowed in Personal Injury Claims?
It might seem unfair that some of your personal injury settlement would be given to your health insurance company. However, subrogation claims make the system fair. Otherwise, victims would be “double dipping” when they file a personal injury claim.
Your personal injury settlement includes several different types of damages. Damages are divided into two categories: non-economic damages and economic damages.
Economic damages compensate you for your monetary losses. They include medical bills, property damage, out-of-pocket expenses, and lost wages.
Non-economic damages compensate you for your personal and emotional losses, such as pain and suffering. This category includes compensation for emotional distress, impairments, disfigurement, mental anguish, and diminished quality of life.
You would receive double benefits if you received a personal injury claim that included reimbursement for medical bills paid by another source. Health insurance would have taken care of your medical bills, so the money you received would be for a “loss” that you did not incur. Subrogation claims correct this situation.
Protect Your Rights Regarding Subrogation Claims
You may not avoid dealing with subrogation claims. However, you can work with an attorney to protect your rights. Keep copies of all medical bills and records you receive during your treatment. Also, keep copies of all statements and documents you receive from your health insurance provider. Give your attorney the documents to compare as they work on the subrogation claims.
Get Help With a Personal Injury Claim
An experienced Jacksonville personal injury lawyer can help you deal with all matters related to an injury claim, including subrogation claims. Call Baggett Law Personal Injury Lawyers at (904) 396-1100 for a free consultation with one of our accident attorneys to discuss your legal options.
