Liens and Personal Injury Settlements
Jun 23, 2015, 08:30 ET
MOUNTAINSIDE, N.J., June 23, 2015 /PRNewswire/ -- New Jersey personal injury cases can be subjected to liens. A "lien" refers to money to be paid out of a judgment or settlement, many times to medical care providers who were never paid their full bill. Since unpaid medical bills can show up on credit reports and can potentially impact a person's credit rating, it is important that a personal injury settlement covers any open bills prior to final payment to the injured plaintiff. In personal injury cases, the lien is a legal claim on the money that has been or will be awarded for injuries in the case. Major liens in a personal injury case may involve the following four types.
Photo - http://photos.prnewswire.com/prnh/20150622/224652
Photo - http://photos.prnewswire.com/prnh/20150622/224653
- Medical bills unpaid by insurance
According to NJ Personal Injury Attorney Francis M. Smith this is the most common reason for liens in personal injury cases. Medical bills often prove to be much higher than the patient anticipates, especially for serious injuries or extended treatment and care. Mr. Smith explains, "If the medical bills from your injuries resulted in a large amount of outstanding personal debt because you were unable to pay out of pocket for those expenses, your attorney, with your consent, can agree to "protect" the bills of medical providers. This means that you and your attorney are promising to pay the medical bills when you receive a settlement or judgment." This is one kind of lien, and saves the injured from going "into collections" - where they can be pursued by debt collectors and their credit rating may be adversely affected.
- Health care insurance payments
Too often the health care insurer gets involved when the auto insurance's personal injury protection (PIP) is insufficient to cover the medical costs. When PIP benefits are exhausted, the medical care providers bill the health insurance company. Under certain circumstances, the health insurer then may turn to the personal injury settlement recipient, to recover those financial losses. They may call this their "right of reimbursement" or "subrogation." But not all asserted health insurance liens need be paid. In New Jersey, if the health coverage is true insurance, it is illegal (by statute) for the health insurer to demand reimbursement. If the health coverage is under a true self-funded plan created under a federal law (ERISA) they may indeed have a legitimate right to reimbursement. Your attorney will demand appropriate proofs to sort out whether the plan has a right of reimbursement or not.
The New Jersey Medicaid office can be contacted to determine the bills they paid for medical treatment caused by the accident, which must be repaid.
A federal statute provides that if Medicare is not repaid for the bills they have paid, they can pursue the injured party for repayment, the attorney handling the claim or lawsuit, and the insurance company that paid the claim. Many insurance carriers are now requiring proofs that the Medicare lien is being taken care of as part of any settlement negotiation and final resolution of a personal injury case.
Getting Help in Handling a Lien
A good personal injury lawyer who has plenty of experience in handling liens relating to medical bills is an indispensable resource when facing liens on your personal injury damages award or settlement. "Without experienced help, injured plaintiffs may find the settlement money that they are relying on during their recovery, is snapped away by insurers, medical bills, and Medicare or Medicaid," warns Mr. Smith. "An experienced personal injury attorney helps ensure that any liens are fair to both parties and actually related to your injury, and that the lien is properly finalized so that insurers cannot pile on more liens later," he adds.
About Francis M. Smith, NJ Personal Injury Attorney
Francis M. Smith, Esq. handles all types of personal injury cases throughout northern New Jersey, many involving assorted liens. More information on Francis M. Smith is available at http://www.FrankSmithLaw.com
Francis M. Smith, Esq.
Cell: (908) 337-5888
Francis M. Smith, Esq. NJ Personal Injury Attorney
SOURCE Francis M. Smith, Esq. NJ Personal Injury Attorney
Share this article