Reimbursement of Subrogation Liens
Hospitals who have admitted you for treatment of the injury will be entitled to claim a hospital lien for payment out of the recovery in your case. Other parties entitled to assert subrogation liens for reimbursement of payments include Medicare, Medicaid and other governmental agencies, workers compensation insurers, employee benefit plans (especially ERISA self funded plans), and HMO's and group health insurers. In past years plaintiffs have received something of a windfall by reason of write offs of unpaid balances by medical providers who accepted partial payment from subrogees. The tort reform legislation passed in 2003 contains provisions that may limit the plaintiff's medical expenses damages in such cases. Most subrogation liens are subject to discount for the subrogee's pro-rata share of the plaintiff's attorneys fees, and some to bigger discounts under the "Made Whole Doctrine" and other legal defenses. When negotiating a discount before settlement the plaintiff is in a strong bargaining position. If the subrogee demands too great a share of the available recovery the plaintiff can simply drop the case and nobody gets anything. Subrogation liens cannot be ignored, but most can be significantly discounted through negotiation by your lawyer.