Who Do I Have to Repay for Medical Bills if I Settle My Case?
Unfortunately, after you pursue an injury case and receive a financial award, it is possible that you will have to reimburse various people and/or companies. Aside from medical liens, here are some common types of reimbursements that you may have to pay.
Automobile Medical Payments Insurance Reimbursement
Most car insurance companies stipulate that if a client is injured in a car accident and requires payment of medical bills, the company expects to be repaid once the client receives a settlement intended to cover those medical bills. However, here in Georgia the law states that insurance companies’ clients do not have to reimburse the company as long as the settlement amount does not exceed the total cost of all lost wages, pain and suffering, and medical expenses. In reality, insurance companies very rarely sue their own clients for reimbursements.
This is the statute outlining these points:
(b) In the event of recovery for personal injury from a third party by or on behalf of a person for whom any benefit provider has paid medical expenses or disability benefits, the benefit provider for the person injured may require reimbursement from the injured party of benefits it has paid on account of the injury, up to the amount allocated to those categories of damages in the settlement documents or judgment, if:
(1) The amount of the recovery exceeds the sum of all economic and noneconomic losses incurred as a result of the injury, exclusive of losses for which reimbursement may be sought under this Code section; and
(2) The amount of the reimbursement claim is reduced by the pro rata amount of the attorney´s fees and expenses of litigation incurred by the injured party in bringing the claim.
(c) In the settlement of any claim for personal injury, under circumstances where it is claimed that the amount of the recovery does not exceed the sum of all economic and noneconomic losses incurred as a result of the injury, a benefit provider which has paid benefits to or on behalf of the injured person may seek a declaratory judgment pursuant to Code Section 9-4-2 as to what extent it may equitably share in said settlement. If the court determines said settlement does not fully and completely compensate the injured party, the benefit provider has no right of reimbursement.
Because Medicare is government-funded, it is considered a “secondary payer”, meaning that it does not pay clients until every other financial source, such as the at-fault driver’s insurance policy, has paid the victim. At times when Medicare does pay its holders earlier, the program is entitled to a lien against the settlement amount that the victim ultimately receives.
In other words, if Medicare pays your medical bills and you later receive a settlement intended to cover those same medical bills, then Medicare will request to be reimbursed. You can use this formula, however, to minimize the amount that you have to pay:
1) Find the ratio of your procurement costs to the total liability, judgment, or settlement payment.
2) Multiply this ratio by your Medicare payment. This amount is Medicare’s portion of your procurement costs.
3) Take this amount and subtract it from the entire conditional payment amount or the provider’s amount. The difference is the amount that you are required to reimburse Medicare.
As you can see, this is a complicated system, and it generally requires legal guidance to be carried out correctly. As of 2011 there have been major changes to these policies that might affect you, so be sure to discuss them with your lawyer.
If Medicaid has paid your medical bills after an accident, you will be required to reimburse these payments based on a certain percentage of the amount you received in benefits from Medicaid. If you are in this situation, you should contact a lawyer to help you sort everything out.
Health Insurance Reimbursements
You can usually assume that your health insurance provider will request that you reimburse the bills that they paid on your behalf. But determining exactly what you are required to pay is a complicated process, depending on whether your health insurance plan operates under Georgia law or Federal law. If your plan is governed by Georgia law, then your health insurance company is only entitled to the specific reimbursements outlined under statute O.C.G.A. §33-24-56.1. Otherwise, if your plan is governed by Federal law, then state law no longer applies and you will need to negotiate the reimbursement with your insurance provider. Hiring a lawyer is important in this case, because some insurance companies reduce the amount they require by up to 50% if a lawyer is handling the case.
If you have received worker’s compensation for your medical bills, then you will surely be asked to repay the costs after receiving a settlement. Under Georgia law, worker’s compensation companies have the right to file suit or even to join your own injury lawsuit. However, the company is not actually entitled to reimbursement unless you have been “fully and completely compensated” by your settlement. O.C.G.A. §34-9-11.1. It is rare that a party is able to settle their case for full compensation and workers compensation carriers have a very hard time proving this to the Court. You should talk to your lawyer about how best to handle this situation.