What is a lien, and how does it affect your personal injury case?
A lien is a legal entitlement by a third party to all or part of your settlement money. That third party could be anyone from a doctor who provided you treatment to an ex-spouse to whom you owe back child support. The lien is essentially a request for repayment, and the law recognizes that some parties may be more entitled to your settlement money than you are. If your settlement has a lien placed on it, that third party will be repaid before you get your money.
Learn more about liens here, including what they are, who can file them, and what they can do to your personal injury settlement.
In a personal injury case, some of the most common liens will come from your healthcare provider or insurance companies. Medical treatments can be expensive, and if you’re filing a personal injury lawsuit, your insurer will want to know.
Hospital lien laws in Idaho entitle a hospital to file a lien for “reasonable charges” related to treating and caring for you. When you’re in the hospital, the hospital will likely present you with a lien letter to sign. That letter confirms that you will submit to the lien and pay them out of your settlement when you receive it. In the state of Idaho, physicians and nurses alike are entitled to liens.
If the government paid for any portion of your care while you were in the hospital, they are entitled to get that money back. Idaho’s Medicaid recovery statute establishes that if your settlement doesn’t specify a portion attributable to medical expenses, the state has a primary claim to recoup the amount spent on your care. In layman’s terms, they have “first dibs” on your settlement to get their money back.
The Veterans’ Administration is another government entity, much like Medicare and Medicaid, so the same rules apply. If the VA paid for any portion of your care, they can and will place a lien on your settlement.
Were you injured on the job? If worker’s compensation covered your medical expenses, your employer may place a lien on your settlement for the amount spent on your care. However, Idaho makes an exception if your employer was found to be partially or completely at fault for your accident.
If you have paid your health insurance premiums and reached your deductible, you may be frustrated when your insurance company files a lien against your settlement.
Talk to your personal injury attorney and go through all the paperwork together. Your insurance company can’t file a lien for any money you paid out of your own pocket prior to meeting your deductible. What they want is their own money back.
Once you reach your deductible, your insurance company will start paying a percentage of eligible medical expenses. Depending on your plan, they may also chip in for expenses prior to meeting that deductible. They then file the lien to recoup those costs.
Nobody wants these liens to be withheld from their settlement amount, but it’s the law. Your personal injury attorney in Boise can help you understand why these liens are in place, but they can’t make them go away. If those liens are not paid from your settlement, you—and your attorney—could be financially and legally responsible.
However, your attorney can be a great asset in negotiating these liens! Liens are generally contingency based, meaning you won’t have to pay them until you actually win your settlement. The negotiation process won’t start until the case is officially settled.
The process itself can be long and arduous—insurance companies generally don’t make lien negotiation a priority. These negotiations often entail digging through records to find bills that are months or years old. The COVID-19 pandemic has slowed this process down even further.
A top-tier attorney will be your greatest ally during negotiations. The personal injury team at Rossman Law Group is persistent and patient—two traits that have served us well in negotiating with insurance companies. If you are unfamiliar with liens or believe they are unfair, bring your concerns to your attorney.
If you genuinely believe that a lien is unfair or that the party is asking too much, you and your attorney can contest it. It’ll be up to the judge to decide whether you must pay the lien out of your settlement. Are there multiple liens on that settlement amount? The judge can determine which party has the top priority.
If your healthcare provider or insurance company filed the lien and you genuinely do owe them money, expect the court to uphold it. You deserve high-quality medical care, but the people providing it to you also deserve to be compensated for their labor.
However, if the amount of the lien seems unfairly high to you, go through your medical bills with a proverbial fine-tooth comb. You may owe some money, but not as much as they’re asking for! Your attorney can help you pore over the paperwork and arrive at a fair number. When you and your attorney work in sync with one another, you can face the negotiation process with confidence.
The personal injury lawsuit process is long and can be confusing at times, especially when you’re still seeking clarification on what a lien is. All you want is fair compensation for your ordeal. The presence of one or more liens on your settlement shows that you’re not the only one seeking compensation! The hardworking healthcare professionals who cared for you during your injury also want to see a payday at the end of your case.
While the savvy injury attorneys at Rossman Law Group can’t make liens disappear from your settlement, we can help you negotiate them if necessary. If something doesn’t look fair or right to you, talk to your attorney about your concerns. We’ll do everything in our power to ensure a fair settlement for you.