What Happens to My Medical Bills at Settlement?

One of the most frequent questions we receive from clients is: "What happens to my medical balances when my personal injury case settles?" This is an important concern, as medical bills can pile up quickly after an accident. Understanding how these balances are handled during and after settlement is key to managing expectations and ensuring that you are properly compensated.

In this blog, we’ll break down the process of what happens to your medical balances at settlement, how liens and negotiations play a role, and what you can expect when the dust finally settles.

Medical Bills After an Accident

After an accident, medical bills can come from a variety of sources—emergency room visits, surgeries, physical therapy, medications, and more. Whether these expenses are being paid upfront by health insurance, out of pocket, or on a lien basis, they still need to be addressed when a personal injury case is settled.

What Happens to Medical Balances at Settlement?

When your personal injury case reaches a settlement, part of the settlement funds will typically be used to pay your outstanding medical balances. The settlement amount you receive is intended to compensate you for various damages, including medical expenses, lost wages, and pain and suffering. But before you receive your portion, outstanding medical bills must be taken care of.

Here’s what happens next:

1. Medical Liens Are Paid First

In many cases, medical providers or insurance companies will place liens on your personal injury settlement. A lien is a legal claim that ensures healthcare providers are reimbursed for the services they provided while your case was being resolved. These can come from:

  • Healthcare providers: If your doctor, hospital, or other medical provider treated you on a lien basis (meaning they deferred payment until after your case settled), they will expect to be paid directly from your settlement.
  • Health insurance companies: If your health insurance covered your medical bills, they may seek subrogation. This means that they are entitled to recover the amount they paid for your medical care from your settlement.

Once your case settles, these liens are typically negotiated and paid out before you receive any remaining funds.

2. Negotiating Medical Liens

One of the most critical aspects of managing medical balances at settlement is negotiating the amount of the lien. Your personal injury attorney will often work with healthcare providers and insurance companies to reduce the total amount of medical bills that must be paid out of your settlement. This can lead to significant savings and more money in your pocket.

For instance, if you had $100,000 in medical bills, your attorney may be able to negotiate the lien down to a lower amount, such as $70,000. The remaining $30,000 would not need to be paid, allowing more of the settlement to go toward your compensation for pain and suffering or other damages.

3. Paying Out of Pocket Balances

If you’ve been paying some medical bills out of pocket while waiting for your settlement, those balances can also be reimbursed from the settlement. Any money that you’ve spent on medical care, medications, or therapy related to your accident should be accounted for in the settlement negotiations.

4. Medicare and Medicaid Liens

If Medicare or Medicaid paid for any of your medical care, they will also have a lien on your settlement. These government programs are entitled to recover what they paid for your treatment, so part of your settlement must go toward satisfying these liens. Your attorney will work to ensure that these are addressed properly, and in some cases, these liens can also be negotiated to a lower amount.

What You Get After Medical Balances Are Paid

Once all medical bills, liens, and legal fees have been addressed, the remaining balance of the settlement is yours. This portion is intended to compensate you for pain and suffering, lost wages, and any future medical expenses you may incur as a result of the injury. Your attorney will help ensure that you receive the maximum amount possible after all obligations have been fulfilled. 

Can Medical Bills Be Higher Than My Settlement?

In some cases, the medical bills and liens may exceed the amount of the settlement. This can be a stressful situation, but it’s not uncommon. When this happens, your attorney will negotiate with the medical providers and lienholders to reduce the balances so that they fit within the available settlement funds. Your attorney’s goal is to ensure that as much of the settlement as possible goes to you, while still addressing the medical balances.

How Can an Attorney Help With Medical Balances?

An experienced personal injury attorney plays a crucial role in managing and negotiating your medical balances at settlement. Without an attorney, you may be left paying the full amount of your medical bills without any reductions, leaving you with less of your settlement to compensate for other damages.

Here’s how an attorney can help:

  • Negotiating medical liens: Your attorney will work to reduce the amount of the medical bills or liens you owe, ensuring more of the settlement goes to you.
  • Waiving medical liens: in certain situations your attorney may be able to get a lien waived in its entirety so you will owe no money.
  • Ensuring proper payment of liens: An attorney will ensure that all liens are paid appropriately and that there are no surprises after the settlement is finalized.
  • Maximizing your settlement: A skilled attorney can maximize the amount of compensation you receive after medical bills, legal fees, and other expenses are taken care of.

Conclusion: Navigating Medical Balances With Professional Help

While medical bills can be a significant concern after a personal injury, rest assured that they can be addressed and negotiated as part of your settlement. With the help of a qualified personal injury attorney, you can ensure that your medical balances are paid while still receiving the compensation you deserve for your injuries.

If you have questions about how your medical balances will be handled at settlement, or if you need help with your personal injury claim, Harris Personal Injury Lawyers is here to assist. Contact us today at 1-800-GO-HARRIS for a free consultation and let us help you navigate the complexities of your case to ensure you receive the maximum compensation possible.