If you were hurt in an auto collision caused by a negligent driver in Virginia, you are entitled to compensation for your injuries. However, your medical insurance provider could place a lien or subrogation claim on your settlement proceeds. This could significantly reduce the amount of money you receive in your settlement.
How Subrogation and Liens Work in Car Accident Cases in Virginia
Subrogation and liens are different but can have the same practical effect in your auto crash case. A lien is a claim on your settlement award that would entitle your health insurance provider to be reimbursed for the medical expenses they paid on your behalf. If they claim a right to subrogation, the health insurance company would take your place in filing a claim against the negligent motorist for the medical bills they paid and demand that the payment be made directly to them.
The laws on subrogation and liens are complicated in our state. Unlike other states, Virginia has laws that prohibit health insurance contracts issued in our commonwealth from having a subrogation clause in their contract. Liens are also often not permitted to be placed on a victim’s car accident or other personal injury award.
However, there are exceptions to these laws. The anti-subrogation and lien laws would not apply in these situations:
- Contracts issued out-of-state
- Insurance policies issued to federal employees under the Federal Employee Health Benefit Act
- Self-funded health benefit plans by employers who are compliant with the Employees Retirement Income Security Act (ERISA)
- Federal health insurance providers, like Medicare, Medicaid, and Tricare
- Workers’ compensation plans
How Can You Know If a Lien or Subrogation Claim Will Reduce Your Car Crash Compensation?
The best way to determine if your health insurance provider can make a subrogation claim or place a lien on your award is to retain an experienced car accident attorney. An attorney can review your health insurance policy and the medical expenses your provider claims reimbursement for to determine if they are valid.
If your lawyer determines that your health insurer has a valid claim against your award, they can negotiate the amount to be paid to the insurance company. However, these negotiations must be completed before the settlement of your car accident claim.
Were you injured in an auto collision in the Virginia Beach or Norfolk area? Call our office to schedule your free case evaluation to learn how our knowledgeable and dedicated car accident legal team can assist you.