“Subrogation” = Debt collector for your health insurance company who wants the money it paid for your medical care back now that you are going to receive a settlement for your injuries.
There are three primary forms of healthcare subrogation that clients commonly encounter with regards to a personal injury case. We will discuss each below.
Medical Payments Subrogation
After your insurance company provides you with a medical payments’ coverage payment, they will request that this amount be reimbursed by any eventual third-party settlement that you receive. This lien for reimbursement is then transferred to the medical payments’ subrogation department.
Once you have received a settlement or judgment, your attorney will have to notify the medical payments subrogation team that you have settled the case. The insurance company is obligated to reduce the amount owed by the percentage of your lawyer’s attorney’s fees.
Additionally, a skilled personal injury lawyer may be able to further reduce or completely waive the amount owed for the medical payments coverage under California’s Made Whole Rule.
Government Health Insurance Subrogation (DHCS MediCal, MediCare, ERISA Federal Health Plans)
The majority of people are insured through some sort of government health insurance plan including California’s DHCS Medi-Cal, Federal MediCare, and ERISA Health Plans offered by some government-related employers.
If any of these health insurance plans have paid for medical benefits you have received in relation to your injuries, your attorney is required by law to notify them of any settlement, and they are entitled to reimbursement. However, your personal injury lawyer should still get any requested reimbursement reduced by the percentage of attorney’s fees you are paying.
Private Health Insurance Subrogation
Your private health insurance company also has the right to reimbursement for medical benefits paid on your behalf related to injuries from an accident if you receive a third-party judgment or settlement related to the accident.
However, unlike the federal healthcare plans, your attorney has more leeway to negotiate with these private insurance companies because they do not have a statutory right to reimbursement.
A skilled personal injury lawyer can help to effectively reduce any lien owed to your health insurance providers related to medical care rendered as a result of an accident.