Accidents happen all of the time in Virginia and leave victims with serious injuries that are costly to treat. To help cover these costs, injured individuals can file a personal injury claim against the at-fault party. Through these claims, victims can seek compensation for the damages, or losses, which they sustained as a result of the accident. When these claims involve subrogation and liens, they can become highly complex.
Subrogation and liens on personal injury claims generally refer to the right which another party acquires to a portion of any compensation that you receive. Liens and subrogation can potentially reduce the amount of compensation that you ultimately receive. A personal injury lawyer at Marks & Harrison can help you sort out these issues so that you recover the maximum amount which you are entitled to receive.
What Are the Differences Between Liens, Subrogation and Reimbursement?
A lien is a claim on the compensation which a person secures through a personal injury settlement or verdict. The party that holds a lien on the personal injury claim can be legally entitled to receive a portion of the personal injury award.
For example, a health care provider may agree to treat an injured individual even though the individual cannot pay for medical services until he or she receives compensation in a personal injury lawsuit. The injured individual will then agree to reimburse the health care provider for services once the individual recovers compensation.
Subrogation is different from liens and reimbursement. When a party has a right to subrogation, that party actually takes the place of the injured person when filing a lawsuit against the at-fault party. For example, if you were injured in an auto accident while on the job, your workers’ compensation insurer may have a right to subrogation. The insurer can file a claim directly against the party that caused the accident. So, this is different from a lien. A lien is a legally enforceable claim to property, while subrogation simply provides another party the right to sue. Typically, under Virginia law, any party that wishes to place a lien on another person’s personal injury claim must provide written notice, or else the lien will be invalid.
The purpose of liens and the right to subrogation is to prevent “double-dipping” in personal injury claims. For example, if a person suffers injuries in an accident, the person’s health care insurance should pay for his or her covered medical expenses. That person may then receive money for those expenses through a settlement or verdict, even though an insurer has already paid for them. By placing a lien on the compensation awarded in a personal injury claim, the health care insurer can try to recover the money it paid for the person’s medical costs.
Can Health Care Insurers Assert a Lien on Your Personal Injury Claim?
In Virginia, health care insurers are generally not allowed to place liens on another person’s compensation in a personal injury claim. However, there are several exceptions that may leave a person’s compensation vulnerable to a lien. For example, self-funded ERISA-qualified plans are often allowed to assert liens on personal injury claims. Federal health insurance programs such as Medicare, Medicaid and Tricare are also allowed to assert liens on an accident victim’s claim.
Will Subrogation and/or Liens Reduce Your Personal Injury Compensation?
Although reimbursement, liens and the right to subrogation are all different terms, and they all work differently, they all have one thing in common: If any of them are placed on your personal injury settlement, it could potentially reduce the compensation which you ultimately receive.
To ensure that only the proper amount is taken from a personal injury claim and whether someone must pay back anything, an attorney should review it to ensure that only valid expenses are on the claim. Sometimes, other expenses are included that the victim did not incur as a result of the accident. When this is the case, a lawyer can ask the health care insurer to remove the additional items so the accident victim can secure full compensation.
Can a Lawyer Negotiate with a Lien Holder?
When a lien is placed on your personal injury claim, it may be difficult to remove. To do this, you must prove either that the lien should not have been placed on the claim, or that the services rendered were not related to the injuries sustained during an accident.
A lawyer can negotiate with a lien holder, but this negotiation must take place prior to coming to an agreement on a settlement. If you accept a settlement, and a lien has been placed on the settlement offer, then the lien holder will have no reason to negotiate with your attorney and accept a lower amount.
Before a case is settled or goes trial, however, there is no guaranteed outcome. So, the insurer, just like the accident victim, risks receiving nothing if the case is not successful. For this reason, lien holders are typically more likely to negotiate a lower lien amount before a settlement or verdict is secured in a case.
Get Help from Our Virginia Personal Injury Lawyers
If you have been injured in an accident and need to file a personal injury claim, a dedicated personal injury lawyer at Marks & Harrison can help you. Our attorneys are skilled negotiators. We will work aggressively to hold all negligent parties accountable and to pursue all compensation that you deserve. Additionally, we can navigate the complex issues of dealing with liens, reimbursements, and/or subrogation as well as negotiate any reductions in your case.
If you have been hurt due to someone else’s negligence, contact us today to discuss your case in a free consultation. As one of the oldest and largest personal injury law firms in Virginia, we have the skill, experience and resources to help you through this difficult time and seek the maximum amount for you.