What Are Liens On Personal Injury Settlements?

Written by Adam Peck Category: Injury Law January 16th, 2013 2 min read

Over the past few years, Peck Law Catastrophic and serious personal injury attorneys have witnessed an alarming trend–everyone seems to want a part of our clients’ personal injury settlements.

A person who has been injured in an auto accident will have a claim against the person who caused his or her injury. That is called a third-party claim. Increasingly, medical-related liens are being filed against third-party settlements says California Serious Injury Attorney Steven C. Peck.

An example of medical liens that are now being filed against accident victims include:

Balance Billing. These are liens filed by a hospital for the difference between the discounted amount paid by the patient’s medical insurance plan and the total amount of the bill. Traditionally, hospitals would write off the balance after the patient’s medical insurance paid the hospital bill. Arizona state law now allows hospitals to assert a lien against an injured person’s third-party settlement for the balance of his/her hospital bill.

Medical Insurance Subrogation. This type of lien comes in many forms. Depending on the employer from which the medical insurance plan is provided, the plan might have rights to assert a lien against an injured person’s third-party settlement or even against their uninsured, underinsured or medical payments coverage for the medical expenses paid on his/her behalf. Examples of valid liens are ERISA plans, which are “employer-funded” or “self-funded” health insurance plans; government employees’ medical insurance plans; Workman’s Comp; and other health insurance plans such as those funded by railroad companies.

Entitlement Health Plans. Medical insurance plans provided under AHCCCS, Medicare, Medicaid, etc., have a statutory lien against third-party claims. However, Medicare is now enacting changes that will allow them, under certain conditions, to attach to settlement monies permanently.

Client’s Auto Insurance. Auto insurance plans that provide Medical Payments coverage on a personal injury claim may be entitled to reimbursement from a third-party settlement for any amount paid over $5,000.

Consensual. If the injured person does not have health insurance a medical provider may accept a lien for services provided. This is known as a consensual lien. This lien will be satisfied when the third-party claim is settled

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Written by Adam Peck

Expertise: Personal Injury

Adam J. Peck, ESQ is a principal with Peck Law Group, APC. In 2008, Mr. Adam Peck received his Juris Doctorate from Whittier Law School where he graduated Cum Laude. His practice is primarily dedicated to representing Elders, Dependent Adults, along with their loved ones and family members, who have suffered horrific personal injuries.