Liens and Injury Settlements
By Chris Dixon
If you or a family member have been in an accident, you may be wondering how it is possible to pay off medical bills and other expenses before you get any sort of compensation. The answer is liens, or a type of loan or line of credit agreed to be paid back to a hospital or insurer once the case is settled. The Dixon Injury Firm will go over liens and how they affect personal injury claims in this section of the FAQ.
What is a Lien?
A lien is credit used while you’re recovering from an injury, don’t have insurance, or if there are expenses you can’t cover due to an accident. Usually, liens are given to victims by health care providers, hospitals, Medicaid, Medicare, the Veteran’s Administration, through workers compensation insurance, or auto insurance companies.
A lien can be placed on your personal injury settlement if you can’t pay for treatment and other expenses. You have a duty to repay these expenses. When you are calculating the damages and negotiating a settlement with the at-fault party, any expenses compensatory damages that required a lien during your recovery process (surgery, lost wages, etc.) need to be repaid. The total payout should equal these special damages plus any general damages like pain and suffering, and you should use that payout to pay off the debt you accrued during the settlement process.
The process for legitimizing or “perfecting” a lien vary from state to state. It’s the duty of the injury victim to repay these liens after the verdict and you’ve gotten the reward.
Liens From a Healthcare Provider
One of the most common types of liens comes from healthcare providers. If you need to get medical treatment for an injury and can’t pay the bills, a lien acts as credit until you settle a case. You will have to pay the bill if you don’t win the case, of course, but there are statutes of limitations on collections depending on which state you’re in. You might get lucky and a hospital will waive what you owe (but don’t count on it).
If you’re injured and can’t pay a hospital, they’ll likely have you sign a letter of protection before treating you. If you don’t repay the healthcare facility after you win a case or claim, you can be sued.
From a federal standpoint, if you received veteran benefits, Medicare, or Medicaid, the government likely has a lien on any reward you can get for your personal injury case. It’s very important to pay off these liens as soon as you win a settlement. If you don’t, you may have to pay double the original cost if (and when) the government takes legal action.
Liens Through Private Insurers
If your private insurer paid for your treatment, they usually have a right to request repayment with a lien over your personal injury settlement. This is because they don’t want you to get paid twice (they pay for your treatment, then the settlement pays you for the expense). “Double dipping” may seem unfair but you need to consider that expense after you win a case. The same goes for auto insurers.
Need Help? Call a St. Louis Injury Lawyer Today
No one dealing with a personal injury case wants to have liens over their settlement. They are necessary sometimes, of course, if you are uninsured or don’t have enough credit to pay back a hospital or to cover other expenses. It’s important to reach out to a local personal injury lawyer if you have any hesitation about the claims process or if you need to take your injury claim to court.
The Dixon Injury Firm helps injury victims and their families in Southern Illinois and the Greater St. Louis area. You can contact one of our injury lawyers 24/7 for more information about liens and how they impact personal injury settlements. We offer free consultations and case reviews to all of our clients.