Accident Victims Are Being Pillaged by Health Insurers: How to Protect Yourself from Ruin After an Accident

ORANGE COUNTY, Calif., July 8 /PRNewswire/ -- What would you do if you were severely injured in an accident and your heath insurance company insisted it be reimbursed all of the compensation you could possibly receive from the liable party? "In a startling change of tactics, health insurers are becoming very aggressive, asserting rights to all the accident insurance money available to injury victims, leaving the injured person without any financial recovery," said James Ballidis, a California injury lawyer and specialist in ERISA health insurance reductions.

The cost of medicine has far surpassed the minimum insurance limits that must be carried by a vehicle driver. One significant visit to the hospital will consume the entire $15,000 mandatory insurance coverage in California and many other states. "If there is not enough insurance, and if the other party has no assets, shouldn't there be some consideration for the victim? Not according to recent ERISA Supreme Court interpretations," he said.  

Most States protect their citizens from insurer wrongful practices, but the Federal Government has lagged. ERISA, the federal Employee Retirement Income Security Act, was enacted in the 1960s and governs the rules for health insurance offered by employers. It supersedes state law in many areas. The U.S. Supreme Court, in recent decisions, has concluded that a health insurer can place its rights to reimbursement above the rights of the victim by including a boilerplate provision in the policy you receive, the policy you won't read and probably cannot understand.  

The danger is demonstrated in a real case recently successfully resolved by an attorney in California. A young employed California man was riding his motorcycle to work when a woman pulled from a curb causing a terrible crash. The woman had no assets, and only had $100,000 in liability coverage. The medical bills exceeded $200,000 with five surgeries. He was out of work for two years, lost his job and health insurance. The health insurance company was offered a portion of the policy, and a portion to go to the victim. The company refused. Asserting recent case law, the insurer insisted it be paid all the proceeds of the policy. Frustrated, the prospective client was referred to Ballidis.

"The value of this man's claim far exceeded the policy limits, and he deserved some measure of assistance," said Ballidis. "We had to convince the health insurer that full reimbursement was not fair, not palatable, and would be a political and public problem for them. With patience and perseverance, we prevailed."  

What can be done is dependent on each case. Here are several important points that every victim should be aware of:

1. Do not settle your case before you have agreed with the health insurer as to the amount of settlement it is to receive.  

2. Do not agree to settle your case without some consideration given to you by the health insurance company.

3. Negative publicity may also be of value. The dark side of these demands and the inequity simply do not sit well with the public.

4. Petition Congress and your Representatives to change ERISA. A simple change is in order and can follow the California Supreme Court model of "Common Fund" where both parties receive a ratio of the settlement according to their total damages suffered.  

For example, if an accident victim recovers only $15,000 from the negligent party but sustains $100,000 in health insurance-paid medical bills and $200,000 in other damages, then the health insurance company would receive 1/3 of the $15,000.

After an accident, do not allow your health insurance company to deprive you of the compensation you are entitled to and will need to pay for lost work time, pain and suffering, and future medical expenses. Consult a qualified lawyer to help you.

ABOUT JAMES BALLIDIS

James Ballidis is an author of several books on California auto accidents and claims settlement rights. If you would like to request a copy of his books or need legal advice, email [email protected], call 1-866-981-5596 or visit California Accident Lawyer.

SOURCE James Ballidis