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Do I Still Have To Pay Back My Health Insurance And My Doctor Bills If The Insurance Company Doesn’t Pay Enough?

You have several options.

Option 1 is to settle your lawsuit for more than you need to pay your bills, your lawyer, and make you feel you are not getting completely abused by the system. I focus on this.

Another option is to tell your creditors to sue you. But if you try to settle the case, they hardly ever do. Because most lawyers are pretty decent at option 3, below.

Option 3 is getting your health insurer and doctors to take less. A good lawyer can do this if he knows the bargaining position of each side – his client, and whoever wants to be paid.

So it’s important to realize what “levers” insurance companies and medical and chiropractic providers have.

Obviously, if a doctor or a hospital has an unpaid bill, it can sue you. But they hate to do this; in fact, I have never seen this happen on a personal injury case. They might be able to turn you in to a credit agency, but I really haven’t seen this either.

Some liability insurers recognize “liens” asserted by hospitals and doctors for treatment. I don’t know of any such “liens” recognized by Ohio law, unless the hospital or doctor has first sued the patient, obtained a judgment, and then filed another lawsuit to attach settlement proceeds. This isn’t to say there isn’t some case out there saying there is such a lien – but in 30 years, I haven’t seen it.

Health insurers – Anthem, Humana, etc. – usually have contracts which spell out their rights. One right they sometimes have is to deny your claims for healthcare treatment unless you promise to pay them back out of a settlement, and then do so. This is a pretty powerful “lever”.

Car insurance companies that have “medical payments coverage” interests typically are members of arbitration groups – if one pays medical payments coverage to you, the insurance company for the person who hits you will recognize that company’s lien against any money it owes you in settlement.

Medicare and Medicaid – in Ohio – have actual liens on settlement proceeds that you want to honor. They also have the right to collect the money from any liability insurance company, or anyone who comes into control over the settlement funds – including your lawyer.

The good news is that Medicaid does not pay much, and so it usually has a small lien. Medicare also discounts the bills, and then will reduce its interest according to a formula which takes into account attorney fees and costs incurred in obtaining the settlement or judgment.

Some healthcare providers insist that, before they treat you, you sign a document assigning them an amount equal to their bill out of the settlement proceeds. I see this a lot with chiropractors. But the Ohio Supreme Court has explicitly declared that these liens are not enforceable in the 2009 case of West Broad Chiropractic v. American Family Insurance, 122 Ohio St. 3d 497, 2009 Ohio 3506, 912 N.E.2d 1093. (Forgive the letters and numbers – they are so lawyers can find the case if they need it.) Like any other debt, the chiropractor can sue you for the amount he says you owe; but he can’t make you or your lawyer hold it out of the settlement proceeds.

And your lawyer has to hold out of settlement proceeds any amounts he knows about in which a third party has an “interest”, under rule 1.15 of the Rules of Professional Conduct adopted by the Ohio Supreme Court. An “interest” may include:
– a statutory lien (e.g. medicare, Medicaid, or a UCC lien)
-judgments addressing disposition of the funds or property
– (lawful) written agreements by the client or the lawyer on behalf of the client guaranteeing payment from the specific funds.

But you have “levers” too. Here are some of them:
-You can refuse to settle your case if you are not netting enough from the settlement.
-The insurance company or healthcare provider you owe the money to knows that if he has to go to court to collect money, he will have to pay a lawyer
-The insurance company may not know how collectible you are
-The insurance company or healthcare provider knows a bird in the hand is worth two in the bush. Some money now is usually better than more money later.

The bottom line is that whoever wants your money has a lot of incentive to agree to take less in order to be assured of getting something. And your lawyer will know how to use this.

How does this work? What does it mean for you?

I have had some cases where the client walked away from the settlement with less than I did – but I cannot remember when. Every case doesn’t turn out perfectly – but most of my clients feel as though I was able to help them.

I have been a lawyer over 30 years. I negotiate with doctors, chiropractors, hospitals, and healthcare insurance companies all the time. If you have a personal injury case in Cincinnati, Ohio or if you want to know what your lawsuit is worth, talk with an experienced Cincinnati Personal Injury Lawyer about the case. Call me, William Strubbe, at 513-621-4775.

Because all situations are different, and because there may be other facts pertaining to your case that I don’t know about, you should not rely on this answer for legal advice. I am not your attorney, and no lawyer client relationship has been formed. All discussions are limited to Ohio law unless otherwise indicated. And past performance cannot be used to predict future results.

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