After a car accident, the victim is generally responsible for paying their medical bills. this is the case even if it is clear that the other driver was at fault for the crash. however, if the other party or parties are found to be at fault, the victim may file a claim against them (and/or their insurance companies) seeking compensation for medical expenses. and other damages.
Reading: How do insurance company pay accident medical bills
If the victim has health insurance or med-pay, the insurance company may cover the costs as they add up. a verdict or settlement can compensate the victim for out-of-pocket costs.
After a car accident, how are the medical bills paid?
After a car accident resulting in injuries, each injured person is responsible for paying their own medical bills. Many accident victims have insurance coverage that will pay these bills. the type and extent of this coverage will dictate
- how bills are actually paid, and
- new jersey,
- new york,
- north dakota,
- pennsylvania, and
- the cost of medical services rendered, or
- a fixed percentage of the total settlement: either 33 percent if the victim was represented by a personal injury attorney or 50 percent if the victim did not have an attorney.2
- has made complete doctrine, and
- common fund doctrine.
This is the case even when it is very clear who caused the accident. the at-fault driver will only have to compensate the victim once they have been found responsible for the accident. This happens if a jury verdict finds that he or she caused the accident, or if the driver settles the personal injury claim against her.
Because the at-fault driver may not be held liable for months or even years after the accident, this creates a dilemma for the accident victim. your medical bills will add up, regardless. many of them will have to be paid before the case reaches a verdict or is settled. this can put financial pressure on the victim.
How medical bills are paid will depend on the victim’s insurance coverage. A personal injury attorney can help victims and their loved ones understand this complicated aspect of the law.
the victim has private health insurance or medicaid
if the accident victim has private health insurance, medicare or medicaid, then the insurance company will cover the medical bills. this coverage will be subject to the deductible and other limitations of the policy.
As the victim receives medical bills from health care providers, they may submit claims to the insurance company. These claims formally request the insurance company to pay the medical bills according to the terms of the insurance policy. If the policy does not cover the particular health care procedure or service, the insurance company may deny the claim. if the claim is properly denied, the victim may still have to pay out-of-pocket costs.
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Victims who have had their insurance claim denied and have had to pay for medical treatment out of pocket should consider establishing an attorney-client relationship with an experienced car accident attorney from a local law firm. If a health insurer refuses to cover costs under your policy, it may be in bad faith.
the victim has medical payment auto insurance
Some drivers choose to add medical payment insurance, or “medical payment,” to their auto insurance policies. This insurance coverage will pay medical bills for injuries sustained in car accidents up to the limits of the policy. You generally don’t have a deductible. once the policy limit is reached, responsibility for medical bills reverts to the victim or their health insurance company.
Many drivers use medical payment coverage to offset a high-deductible health insurance plan or to cover health insurance copays.
for example: Tracy is in a car accident. she racks up $100,000 in bills from medical providers and emergency room care. she has health insurance, but the deductible is $6,000. If Tracy has drug payment coverage, then her auto insurance company will pay the first $6,000. If she doesn’t have drug payment coverage, Tracy will have to pay $6,000 out of pocket for her.
the victim does not have health insurance
If the victim does not have health insurance, then he or she will be personally responsible for paying all medical bills out of pocket.
many hospitals have payment arrangements that can spread the amount owed over several years.
If the victim does not pay the medical bills, they will be sent to collection.
what about medical liens or hospital liens?
Most states allow hospitals or other entities to cover the medical bills of an accident victim, in exchange for a lien on any personal injury verdict or settlement. these are known as encumbrances.
When treating an accident victim who doesn’t appear to have enough insurance coverage to pay for their care, hospitals often require the patient to sign a letter of lien. This letter gives the hospital permission to recover what is owed on the victim’s personal injury case.
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Accident victims who accept a lien will not have to pay their medical bills up front. however, the medical institution that holds the lien will recover its costs from any verdict or settlement that is made.
how do you pay bills in a “no fault” state?
some US states. uu. require drivers to carry “no-fault” auto insurance. Also known as personal injury protection or PIP insurance, this coverage will pay some or even all of the medical bills the victim receives. coverage kicks in regardless of who was at fault for the accident, but limits when victims can file personal injury claims in a car accident. No-fault coverage pays medical bills up to the auto insurance policy limit. once the no-fault limit is reached, the liability reverts to the victim or their health insurance company.
The following states use no-fault insurance to prorate the costs of a car accident, rather than personal injury claims:
can my insurance company take a piece of a personal injury verdict?
Yes, insurers often have a contractual right to reimbursement for bills they have paid on behalf of a car accident victim. this right is generally included in the insurance policy. insurance companies pursue this reimbursement of the victim’s personal injury claim through the subrogation process.
for example: mark is injured in a car accident. racks up $20,000 in bills for medical treatment. Her health insurance policy has a $4,000 deductible, so she pays it out of pocket. his insurance company pays the other $16,000. Mark then settles his personal injury claim against the driver who hit him for $25,000. his health insurance company can recover the $16,000 he paid from the settlement.
While surrogacy may seem unfair, it prevents a windfall for the victim. If your insurance company paid the full amount of your medical expenses and later won your car accident claim against the at-fault party, your medical care would be paid twice.
what is the law in california?
California is not a no-fault state. This means that the victim of a car accident is responsible for paying her medical bills, without the help of no-fault auto insurance. however, even uninsured victims can accept a hospital lien against a personal injury verdict or settlement.1
California law also limits how and if insurance companies can recover money through subrogation. For example, insurance companies are limited to the lesser of:
California also recognizes the limitations on subrogation of:
Contact our California car accident attorneys for additional help. Also see our article on how long does it take to get paid after an agreement?
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