Medicare is the federal health insurance program. If payments are made by Medicare for your accident-related health care needs, Medicare will have a lien for reimbursement on your California personal injury settlement.
By having a lien, this means Medicare has the right to reimbursement from your personal injury settlement. Your attorney will notify Medicare of your injury, and they will initiate a process to determine, what, if any, payments were made in relation to your accident case. This process is paperwork intensive and can take quite a long time. In some cases, your case might settle, but everyone will be waiting for weeks or more for Medicare to finish its investigation.
In some cases, insurance companies will initiate their own investigation to make sure they are not ignoring (even inadvertently) a potential Medicare lien. They will ask you to fill out paperwork to begin this investigation, but your lawyer can take care of this.
Some insurance companies will insist on including Medicare as a payee on your injury settlement check unless they receive assurance from Medicare that no payments were issued by them. You can imagine if Medicare is listed on your check, it can take weeks to get them to sign that check and return it.
In some cases, your attorney may be able to negotiate your Medicare lien so it doesn't take such a bite out of your final settlement.
If you were injured in an accident, you may be concerned about medical bills that will start piling up. I've had some clients tell me they declined an ambulance ride because they knew they couldn't afford it. Even if you have medical insurance, there are scenarios when your co-pays and other incidental expenses can really burden you and your family. I've known some clients who've had to declare bankruptcy as the result of mounting health care bills.
There are circumstances when you can indeed get medical care from certain doctors who are willing to work on a "lien" basis. That means the doctors will defer their payment. You have to pay them out of your personal injury settlement. However, you need to be careful that your bills don't get too high or they might exceed the true value of your case. If you have $10,000 in medical bills but your case is likely worth $5000, then you might have a problem. Also, technically speaking, you are still on the hook for the bills even if you don't recover anything from the other party. The doctors aren't working for free. Therefore, before obtaining medical care on a lien, make sure you are likely to obtain a recovery that will be sufficient to pay your bills. An experienced personal injury lawyer can guide you. Also, if your personal auto policy had Medical Payments Coverage, that might also help pay for a portion of your medical bills. It would certainly be worth exploring this additional payment option.
In most cases, I'd say the safe answer is "Yes, you should." Since the other party's insurance company is paying for your losses (damages) in this scenario, it doesn't hurt to inform your company of the accident. Check with your insurance broker, but reporting the accident should have no effect on you since the accident won't be considered "chargeable" to you. That means the accident wasn't your fault, so it should not have a negative effect.
Sometimes, the insurance of the other party is insufficient to cover your loss, so you might find yourself turning to your own company for extra help. If you never informed them of the accident, and then you approach them weeks later, you might be out of luck. Perhaps your contract with your company requires you to report accidents within a certain period of time. You could find yourself in violation of your insurance policy. In either event, it might be a good idea to talk to a personal injury lawyer to discuss what you should and should not be discussing with the insurance adjusters. Oftentimes, what you say "can and will be used against you" in the future. Always be truthful, but also be smart when it comes to these matters. Also, I'd recommend discussing the matter with your insurance broker who should have your best interests in mind.
by Robert Mansour
Robert Mansour is a personal injury lawyer serving Santa Clarita, Valencia,