blog home Personal Injury Can health insurance companies get reimbursed after a personal injury payout?

Can health insurance companies get reimbursed after a personal injury payout?

By John Singleton on July 25, 2023

If you’ve been harmed by another person’s careless behavior, you have the right to seek compensation to cover the costs of your injuries, related expenses, pain and suffering, and inconvenience and aggravation.

For example, if an intoxicated (drugs or alcohol) driver runs a red light and crashes into your car, your personal injury attorney can file a claim against the driver’s insurance company. Your claim could seek compensation for your medical expenses in addition to your lost wages and costs of future medical care.

If you win your case, certain expenses will be subtracted from your settlement before you receive your check. This would include your legal costs and expenses, and it could also include liens on your medical expenses claimed by your healthcare providers and your healthcare insurance.

Virginia does prohibit private health insurance companies from seeking reimbursement from a personal injury settlement, but there are exceptions to this rule. Health insurance plans backed by the federal government generally do have the right to collect reimbursement from the proceeds of a personal injury claim.

When you’re choosing a personal injury attorney to file your claim, make sure to ask how your settlement will be affected by health insurer reimbursement.

When can health insurers claim reimbursement after a personal injury settlement?

Subrogation is the legal term for an insurance company’s claim to the right to seek reimbursement from your personal injury settlement.

But Virginia has an anti-subrogation rule barring many types of insurance plans from receiving reimbursement from your personal injury payout.

Unfortunately, there are cases where federal law overrides Virginia law against subrogation. If you received medical benefits after your accident from Workers’ Compensation or any type of federal healthcare program, your attorney is legally required to inform them about your settlement. This allows these insurers to collect reimbursement before you receive your money.

Insurance plans that are subject to subrogation (meaning they can be reimbursed after a payout) include:

• Medicare
• Medicaid
• Workers’ Compensation
• Tricare for US military personnel and their families
• Private policies covered by ERISA (Employees Retirement Income Security Act)
• Children’s Health Insurance Program (SCHIP)
• Indian Health Service (IHS) program
• Federal Employees Health Benefits (FEHBA)
• Healthcare plans entered into in states that allow subrogation

Should my attorney tell me about possible health insurer claims on my settlement?

Yes.

A lien is a legally enforceable claim that allows someone to collect on your property. Because federal law overrides state law, a federally underwritten healthcare provider can place a lien on your personal injury settlement.

Your personal injury attorney has a moral and legal obligation to be honest with you about all types of deductions that could reduce the amount of your settlement.

If an attorney fails to clearly explain all the deductions that your settlement could be subject to, that’s a red flag, and you should seek an opinion from another attorney before proceeding.

Who can help me after I’ve been harmed by someone else’s careless behavior?

At GibsonSingleton Virginia Injury Attorneys, we consider it a calling to help our friends and neighbors in Virginia. If you were injured in an accident, we’ll file a claim against anyone whose negligence contributed to your injuries.

We treat all our clients with the respect and personal care you deserve. One of our mottos is “big city experience, small town care.”  That’s because we bring outstanding legal backgrounds to every case, along with our compassion, empathy, and concern for you.

At GibsonSingleton Virginia Injury Attorneys, we won’t charge you anything unless we win your case – it’s called our Zero Fee Guarantee. And your initial consultation with us is always FREE.

Call us today at (804) 413-6777 to learn more.