Dewayne Hopson is an attorney in Clarksdale, MS. This article is for informational purposes only and by reading this article you acknowledge this general information should not be construed as legal advice.
Do I Really Have to Pay My Hospital Bills?
I’m not the one to tell people to not pay their bills. Generally, if you owe a debt you should pay it. When it comes to money received from a settlement, the problem of handling medical bills will arise. For some reason, most clients think they can get away without paying their bills or ask can they “negotiate” their bills on their own. (Both phrases really means that they are not really thinking about paying their own bills and they want their whole settlement check.) The short answer is, “it depends.” It depends, because every situation is different.
When meeting with clients, I try to address this problem with potential clients on the front end during the initial consultation that you will have liens on your settlement. I tell my clients to think about, “how much will you be happy with after your medical liens have been paid?” I also ask them, “Do you have any form of insurance?” I usually ask these questions so that clients will not be railroaded when I start talking about medical bills when their case is getting ready to settle.
I have learned that if I inform you ahead of time what potential liens are out there, it will be less of a shock when it comes to distributing the money when that time comes. The main questions that will determine this is, “Have any form of medical insurance paid any of your medical bills?”
Below are three common questions to determine, if you can “negotiate” your own bills. (Receive your whole half of your settlement check.)
Each of these questions could be answered with a whole book but I am just going to give general answers to keep things simple. Also, these answers apply to Mississippi specifically. If you are in another state of reading this, you may have different laws.
Have Medicaid or Medicare payed any of your medical bills?
Medicaid and Medicare are federal and state funded programs and have statutory lien rights by law. If they have paid anything on your medical bills they have a right to recovery by law. In these cases, you cannot negotiate your liens on your own. We will not issue you your whole settlement check. If Medicaid and Medicare does not have their liens satisfied they can come after the attorney and the client for the amount of the lien. This is why most law firms usually hold part (or all) of the client share of the settlement check until the liens are satisfied through what is called the subrogation process which could last anywhere from a one till three months.
Have Your Bills Been Paid by an ERISA employee plan?
Until recently we did not treat ERISA liens on the same level of Medicaid and Medicare liens. ERISA liens are usually liens held on injury claims by employee insurance plan backed by the government. However, do to chances in the law we treat these liens the same as Medicaid and Medicare liens. These companies can now hold the law firm and client responsible for reimbursing them if they paid any medical bills. We would hold these funds the same as if the bills were paid by Medicaid and Medicare. Note: ERISA liens law is a developing area of law which could be changed. A good lawyer should always check up on the latest news, statutes, and case law on ERISA liens.
Have anyone else paid anything on your medical bills?
If someone other than Medicaid, Medicare, or a government backed employee insurance plan has paid your medical bills then we would allow you take your whole settlement and “negotiate” your own bills. Furthermore, it is not uncommon that when people have no insurance that no one has paid on their bills. In this case we would issue your full settlement amount and let you negotiate your own bills. You will still have possible liens on your settlement amount from your healthcare providers, however you can negotiate these liens yourself because there is no statutory right of recovery. (Lawyer friends, please correct me if I’m wrong.)
I trust my clients when they give me their best answers to these questions, but I always verify the answers to these questions on myself. I usually do this by reviewing the actual medical bills.
In short, when the federal government is involved, expect your lawyer to hold a set amount of your settlement until your liens are resolved. Trust me you don’t want Uncle Sam knocking at your door with his hands out because you didn’t pay his lien.
Note: This is how I personally handle medical bills, and liens. Other firms and attorneys may deal with them differently. Also, if my any of fellow attorneys are reading this post and would like to chime in on how they handle medical bills and liens please let me know in the comments. Thanks!
At Hopson Law Group we represent clients who are having a tough time dealing with insurance companies. We can help you get your maximum settlement. You can reach us at 662-624-4100 to set up an appointment for a free consultation to get help with your insurance claim or uninsured motorist claim!