Accident victims in Texas are entitled to financial compensation for out-of-pocket expenses, including medical care. But the typical settlement takes several months to complete in even the best of circumstances. Before then, you will need immediate medical care to treat your car accident injuries. Most people end up using their health insurance at the hospital or doctor’s office.
What happens after you get a settlement? Are you required to repay your health insurance? Our Houston car accident attorney provides the key details below.
Yes, You Are Required to Repay Your Health Insurance
Most Texas drivers have at least $2,500 in personal injury protection benefits, which can pay for health care for your injuries. Some people use the money for their health insurance deductible.
However, $2,500 is not nearly enough to cover the cost of treating even a relatively minor injury. Spend a night in the hospital or have a few diagnostic tests done, and you’ve eaten up the entire PIP benefit. Chances are, at that point you will use your health insurance to pay for medical care.
Insurers expect to get repaid from your personal injury settlement. Indeed, your contract probably contains a reimbursement clause, also called a subrogation clause. This clause creates a right to reimbursement from your car accident settlement for any amounts paid out to treat car accident injuries.
If you have Medicare, for example, they will send out a Conditional Payment Letter to you, as well as the person who caused the accident and their insurance carrier. The letter will instruct the insurance carrier to send a portion of the settlement to them.
If the insurer doesn’t pay Medicare, then Medicare will send a demand letter to you, demanding that you pay within 60 days. If you still refuse, they can sue you.
Something similar happens with private insurance, as well. You can expect them to want reimbursement, because most contracts give them that right.
What if You Don’t Win a Settlement?
Some victims don’t win their car accident case. The defendant’s insurer might deny they are liable for the accident, so they refuse. You might even end up losing a lawsuit in court. Are you required to pay back your insurer?
No—that is not how the reimbursement clause in health insurance contracts works. Instead, they have a right to reimbursement from the funds in any settlement or court award for the car accident.
Will Your Insurer Take Your Entire Settlement?
The size of a car accident settlement depends on many factors, but one of them is the defendant’s resources. A defendant cannot pay money they don’t have. Some drivers do not have any resources to their name, or what they do have is exempt from attachment. Consequently, the only pool of money is their liability insurance.
Some car accident victims suffer horrifying, life-altering injuries. They might require expensive medical care to stabilize them after a life-changing accident. This is true of spinal cord injuries, which often cost more than $1 million in the first year alone. Unfortunately, the defendant responsible for the wreck might only carry the minimum liability insurance in Texas, which is $30,000 per injured person per accident.
Consequently, the settlement could be less than the amount of medical care paid for by your insurance carrier. Will your insurance carrier take the entire settlement?
You should quickly reach out to an experienced car accident lawyer in Houston. The Stano Law Firm will review your insurance policy. We can also try to negotiate a lower reimbursement rate with your carrier, which allows you to receive some portion of your settlement or court award.
What if I Don’t Tell My Insurer I Was Involved in an Accident?
This might sound like a good strategy for keeping more of your car accident settlement. If your health insurer has no idea you were involved in a crash, then they won’t seek reimbursement—right?
Actually, health insurance carriers have large numbers of staff constantly looking at medical bills sent to them by doctors. They are looking for common car accident-related injuries, such as whiplash. If they suspect you were involved in a crash, they will send a questionnaire for you to fill out.
Insurance carriers are aggressive about getting reimbursed. Your best bet is to hire an experienced car attorney to negotiate the reimbursement rate. We can also seek to increase the amount of the settlement, possibly by adding more than one defendant or seeking additional insurance policies in the name of the defendant.
Call The Stano Law Firm Today
Our legal team has won millions for accident victims, and we will do everything possible to grow your settlement as large as possible. Our firm has experience negotiating with insurance companies about reimbursement or subrogation. Contact us at 832-777-0390 to schedule a free consultation, which is without any risk to you.