Do I Have to Reimburse My Health Insurance Company After a Personal Injury Settlement?

If another person’s negligent behavior caused you harm, you are entitled to pursue financial compensation to cover the costs of your damages including expenses related to your injuries, lost income, and pain and suffering. 

What is subrogation in health insurance?

For instance, if a drunk driver runs through a stop sign and plows into your vehicle, a personal injury lawyer can file a claim against their insurance carrier. Your claim can seek recovery for your medical bills along with your lost earnings and the cost of any future medical treatments.

If you win, certain costs will be deducted from your settlement award before you receive your payment. These costs include your legal expenses, and could potentially include any liens on your medical fees claimed by your healthcare insurance and healthcare providers.

For the most part, the state of Virginia prohibits private health insurance carriers from pursuing remuneration from a personal injury award, but as always, there are exceptions to the rule. Any health insurance plan that is underwritten by the federal government typically does have a legal claim on the proceeds of your personal injury settlement.

When you select a personal injury lawyer to file your claim, be sure to ask them how your settlement amount will be impacted by health insurance reimbursements. At the Virginia Beach personal injury firm of Shapiro, Washburn & Sharp, our dedicated personal injury lawyers can help. Call us today and schedule a free case review with a member of our legal team.  

When Can My Health Insurance Company Claim Reimbursement? 

The legal word for an insurance carrier’s right to be reimbursed out of your personal injury settlement is subrogation. Although Virginia has anti-subrogation laws that bar most health insurance companies from collecting reimbursement from your payout, there have been cases where federal law has overridden Virginia’s laws. If you obtained medical benefits from Workers’ Compensation or any other kind of federal healthcare after your accident, your lawyer is legally obligated to notify them of your personal injury settlement. This way the insurance company can collect repayment before you get your money.

Insurance plans that are vulnerable to subrogation are:

  • Medicaid
  • Medicare
  • Workers’ Compensation
  • Healthcare plans entered into in states that allow subrogation
  • Private policies covered by the Employees Retirement Income Security Act
  • Tricare for US military personnel and their families
  • Indian Health Service program
  • Children’s Health Insurance Program 
  • Federal Employees Health Benefits

Will My Lawyer Notify Me About Potential Claims on My Settlement?

Yes, they should. A lien is a legal claim that authorizes someone to collect on your property. Since federal law overrules state law, a healthcare provider that is federally underwritten may put a lien on your injury settlement.

Your personal injury lawyer has both a legal and ethical obligation to be truthful with you regarding any type of deduction that could lower the total amount of your settlement award. 

If a lawyer fails to explain in clear language all of the deductions that your personal injury settlement might be subject to, such as those imposed by a health insurance company, you should consider that a red flag, and seek a second opinion from a different lawyer before proceeding any further. 

Discuss Your Case with an Experienced Attorney

At Shapiro, Washburn & Sharp, we are dedicated to bringing negligent parties to account when their negligence causes injury to others. We have a hard-earned track record of successfully resolving personal injury cases and have recovered millions of dollars in financial compensation for our injured clients throughout Virginia. 

To speak with an experienced Virginia personal injury lawyer, schedule a free and confidential consultation today by calling us at (833) 997-1774.

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