During an initial client meeting, we sometimes hear the client say something like, “The other insurance company has accepted liability, but they are now refusing to pay the medical bills I send them.” Or - “I gave the other driver’s insurance information to the emergency room billing department, but now they’re telling me payment has been denied.” This view, while not uncommon, reflects a misunderstanding about how the insurance claim process works.
Assume that you are rear-ended at a red light and the insurance company for the driver that struck you has accepted liability. In Maryland and DC, there is still NO obligation for the other insurance company to pay your medical bills as they are incurred. The other insurance company, even if they agree that they are on the hook for your injuries, will typically make but ONE payment on your bodily injury claim, and that comes at the very end, after all your medical care is done. At that point, they either make a settlement offer that is acceptable or they lose at trial and have to pay a judgment. A traditional settlement offer is supposed to take into consideration the medical bills incurred by the victim, lost wages, and a sum for pain and suffering.
If the other insurance company doesn’t pay until the end of the case, how does the victim deal with the medical expenses that can pile up long before the case is over? These are the typical options -
1. Health insurance
We usually recommend that clients who have their own health insurance try to run their accident visits through health insurance. That way, the bulk of the bill is paid for through insurance, and the victim is only responsible for co- pays. This is not a perfect solution, however, as large deductibles may mean none of the bills get paid until the deductible is met. And, most health insurers can put a lien on your accident case forcing you to reimburse their payments at the end of your case. And, your choice of medical providers may be limited to only those that accept your insurance.
2. Personal Injury Protection (PIP)
This is easily the best option for getting bills paid after a crash, BUT, the victim had to have purchased PIP on their auto policy. We strongly recommend this. PIP is sold by your auto insurer in increments of $2,500. If you have PIP on your own auto policy, this coverage is available pay early medical expenses, like your e/r bill or therapy, until the benefit is used up. There are no deductibles or co-pays that the victim must contend with. And the insurance company who paid the PIP benefits cannot seek reimbursement for those payments at the end of the case, so you keep more of a settlement or judgment.
3. Pay Out of Your Own Pocket
Medical care is expensive and this is not really an option for most people. But for those who can afford it, paying a bill when it arrives at your house keeps the creditors off your back. Send copies of the medical invoices to your attorney to include in your claim, as well as a record of any payments. A settlement offer at the end of a case technically “reimburses” you for the medical expenses you incurred/paid after a crash.
4. An Assignment If an attorney is involved in your case, some health care providers will agree to render medical care to you and then await payment until the end of the case. This is called an Assignment and Authorization. This allows you some access to injury care even if you can’t immediately pay the physician’s bill. You and your attorney sign a document agreeing to pay the doctor’s bill out of any funds recovered by settlement or trial. The downside of this option is it may limit the choice of health care providers who will treat you, and, worse, it increases the amount of bills to be paid out of your settlement or judgment, leaving you with a much smaller recovery.
While no one wants believe this is the month they get into a car crash, collisions are inevitable. Medical debt can ruin a household. Which of the 4 options would be the best option for you if you were in a collision?
Have You Been Injured in a Maryland Car Accident?
If you've been injured in a car accident, you need to speak with an experienced car accident attorney as soon as possible. Please contact us online or call our Gaithersburg office directly at 301.840.0404 to schedule your free consultation.