“Why should I care which insurance company pays my medical bills after an accident?” If you are injured in an auto accident, your attorney will seek compensation for your “pain and suffering.” S/he will negotiate your claim with the other negligent driver’s insurance company. When your claim is settled, your “net recovery” depends on how your medical bills were paid. Any medical bills paid by PIP do not have to be reimbursed; however, any bills paid by your commercial health insurer or MassHealth must be repaid from the proceeds of your settlement.
“Why do I have to reimburse my health insurer or MassHealth?” It’s in your contract. Read the fine print. If your health insurer pays medical bills that you incur due to the negligence of a “third party,” then you must reimburse it from any amount paid by the third party’s auto insurer to settle your claim.
“What does this mean in dollars and cents?” It makes a big difference in a modest personal injury case. Assume you are injured in an auto accident. The other driver is 100% at fault. Your medical and physical therapy bills total $7,000.00. You agree to settle your claim for $15,000.00. PIP pays the first $2,000 in medical bills, and your health insurer (or MassHealth) pays the remaining $5,000 at a reduced rate of $2,500. From your $15,000 gross settlement, you pay your attorney’s fee of one-third or $5,000 plus expenses of maybe $300. Your net recovery is $9,700, right? Wrong! You owe your health insurer the $2,500 it paid on your behalf. Maybe your health insurer will accept less than the full $2,500, maybe not. If not, your net recovery is down to $7,200 out of a gross settlement of $15,000.
Don't take chances with your recovery. Talk to a lawyer who can make sure you get what you deserve. Call or email Steven B. Rosenthal of The Rosenthal Law Firm today for your free consultation.