The Problem of Hospital Lien Claims in Personal Injury Cases

The Problem of Hospital Lien Claims in Personal Injury Cases on

Here are some tips on negotiating in these situations.

The number of hospital lien claims has increased in popularity perhaps as a result of the number of uninsured or underinsured Americans. In most cases, these types of liens occur when you have a client that received care in the emergency room or who was admitted to the hospital but was unable to pay completely for the treatment. Whether they had no insurance or their insurance didn’t fully cover the expense, there’s a balance to be paid and the hospital now wants to collect what’s due to them. When you’re faced with such a case, there are some key elements you’ll need to know, including how best to negotiate these claims.

What’s the problem?

While it’s perfectly reasonable for a hospital to request payment for their services, the reality is sometimes hospitals mishandle their rights to collect and create unforeseen challenges to your personal injury case. And while every case and lien is different, the issues include:

1. inflation of charges much higher than insurances would pay

2. hospitals have statutory lien rights and are not required to reduce their claims

3. hospitals can refuse to bill the insurance provider, leaving you to negotiate with them, not the insurer

4. they can bill your client for the difference between what your client’s insurance paid and the hospital’s normal charges (which again, is extremely inflated)

5. left unsettled, the hospital lien claim will halt receipt of the settlement from the lawsuit

What’s the best way to handle these liens?

Your goal is always to do best by your client and with that in mind, it’s prudent to address any hospital lien claims right away so you can ensure it doesn’t affect the possible settlement. There are various ways to deal with this issue including:

Ascertain if there’s a possible lien at the first meeting with your client.

This is key because even if your client has not received any lien notices yet, you can easily figure out if there is one in the pipeline by asking specific questions. Did they have insurance at the time of the accident? Did they receive a bill or a statement that the bill was paid in full by their insurance?

Is the lien within compliance?

Every state has different laws and regulations, but in general, hospitals are required to present their lien in a certain time frame and to include specific information. If the hospital did not follow the applicable statute, their lien claim may not even be valid.

Is there an actual balance on the hospital bill?

It’s important to scrutinize the hospital bill to get all the details of what was billed, what’s been paid by any insurer, any amounts that were adjusted, and if the insurance payment accepted as payment in full. If there is a balance on the bill, a determination needs to be made as to whether that balance is a result of an unpaid co-payment or a deductible.

Is balance billing coming into play?

Balance billing is not uncommon but in many states and in several instances it is prohibited. If your client has Medicare or Medicaid, the hospital is not permitted to bill for the balance due after these programs have paid. There are several jurisdictions where this type of practice is not allowed and because there are caveats, it is best to do some research into the issue of balance billing as it pertains to your specific case.

Are they trying to collect on unrelated treatments?

This goes back to examining hospital bills carefully because if the hospital is including treatments to your client that were unrelated to the settlement, they should not be included in their claim. It makes sense but is easy to overlook so make sure that none of the charges listed are for unrelated treatments.

Can you deduct your fees and costs first?

Again, this largely depends on what state you are filing the lawsuit in, but in many cases attorney’s fees and costs can be deducted from the gross settlement before calculating the hospital’s lien claim. Check on the Common Fund doctrine as it applies to your jurisdiction.

When it comes to hospital lien claims in your personal injury cases, there are ways to negotiate the amount requested or even to invalidate the claim. Cover all your bases by keeping these tips in mind when you are up against such a claim.

By | 2017-08-11T13:05:12+00:00 February 24th, 2016|Personal Injury Cases|Comments Off on The Problem of Hospital Lien Claims in Personal Injury Cases

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