When you undergo medical treatment for a personal injury accident, medical providers may place liens on your settlement proceeds. Before you can receive any compensation for damages in your NYC personal injury case, your attorney is required to settle these liens. However, New York laws impose limitations on certain liens that providers and health insurance companies can assert against personal injury settlements. In this article, we will discuss what liens are and how they can affect your NYC personal injury case. For more information, contact our office to speak with one of our skilled personal injury attorneys at Rosenberg & Rodriguez.
Understanding Liens
A lien is a legal claim against a person’s property or assets, serving as a mechanism to secure payment for a debt or obligation. This claim often arises in various contexts, such as mortgages, tax debts, or unpaid services. In the case of personal injury settlements, medical providers and health insurance companies frequently place liens on the settlement amount.
This practice ensures that they are compensated for any medical treatment they have provided to the injured party. The lien acts as a safeguard, allowing these entities to recoup their expenses before the settlement funds are disbursed to the injured individual, ensuring that the costs associated with medical care are appropriately covered. Understanding how liens operate is crucial for anyone navigating the complexities of personal injury claims and settlements.
Types of Liens
In an NYC personal injury case, two types of liens may be imposed: statutory liens and contractual liens.
Statutory Liens
Statutory liens arise from legal statutes, meaning they are automatically applied to your settlement proceeds. These liens include:
- Hospital liens: When you receive treatment at a hospital, they hold a lien on your settlement until they are reimbursed for the services provided.
- Medicare/Medicaid liens: If you are enrolled in these government-funded programs, they will place a lien on your settlement to recover any medical expenses incurred on your behalf.
- Workers’ compensation liens: If your injury occurred at work, your worker’s compensation insurance may impose a lien on your settlement to cover associated medical costs.
Contractual Liens
Contractual liens, often referred to as subrogation rights, emerge from agreements between you and another party. These liens frequently occur in the context of health insurance companies and may be subject to negotiation or dispute in certain situations.
Who Can File a Lien on My Personal Injury Case in New York City?
In New York City, hospitals have the legal right to place liens on the settlement proceeds awarded to personal injury victims, as outlined in New York Code LIE §189. This lien covers any outstanding medical bills related to the treatment of the injury case.
Furthermore, New York General Obligations Code §5-335 imposes limitations on subrogation claims (liens) associated with personal injury settlements from most health insurance providers. However, these restrictions do not apply to Medicaid, Medicare, workers’ compensation insurance, self-funded ERISA health plans, or no-fault settlements.
Importantly, there are no restrictions on liens placed by medical providers. If your doctor has rendered care and agreed to defer payment, they are entitled to assert a lien on your settlement funds. In fact, many medical providers can enforce liens on settlement proceeds.
How Do Liens Impact My Settlement?
Liens can have a significant effect on the amount you receive from a personal injury settlement. Once a settlement is reached, your attorney typically negotiates with medical providers and lienholders to determine the outstanding amounts. This negotiation process may lead to reduced lien amounts, allowing you to retain a larger portion of your settlement. However, it’s essential to address each lien before you can access any funds. Your attorney will calculate the remaining balance after these liens are settled, ensuring you understand the implications for your final compensation.
Additionally, it’s crucial to proactively manage any outstanding medical bills throughout your case. Maintaining clear communication with your healthcare providers regarding the status of your treatment and any liens can help you avoid surprises during the settlement process. Being well-informed empowers you to make better decisions about your financial recovery following a personal injury incident.
Medical Liens Must Be Settled from Your Personal Injury Settlement
Neglecting a medical lien in your personal injury case is a risky move. Failing to address the lien could result in legal action from the medical provider or health insurance company. Furthermore, leaving the lien unresolved may jeopardize your eligibility for future health insurance, Medicaid, or Medicare benefits.
In New York City, personal injury attorneys are required to honor valid medical liens and subrogation claims. However, skilled injury lawyers often negotiate with providers and insurance companies to reduce the amounts owed on these liens.
Navigating and Settling Liens in an NYC Personal Injury Case
Recovering funds for liens from personal injury settlements can be a complex process. Teaming up with an experienced personal injury attorney can help you avoid potential pitfalls. Your lawyer is well-versed in the law and understands which parties have the legal right to place a lien on your settlement proceeds.
A crucial responsibility of your attorney is to negotiate lower payments for medical and health insurance liens. While these companies are not obliged to accept reduced amounts, proficient accident attorneys know how to effectively advocate for your case, arguing that paying the lien would impose an undue financial burden on you.
In many cases, these companies may agree to accept a lower payment for their liens. If they do, you won’t be responsible for the remaining balance on your medical bills, as the provider will simply “write it off” after receiving the negotiated amount from your attorney.
In personal injury cases, victims in New York enjoy certain protections against liens. However, individuals in other states may not have the same safeguards, making them vulnerable to liens placed by medical providers or health insurance companies on their personal injury settlements.
Why Are Liens Necessary in My Personal Injury Case?
The rationale behind these liens is to prevent individuals from benefiting twice from the same injury claim. In simpler terms, if you are not required to reimburse your doctors, hospitals, and health insurance providers, you would effectively receive funds intended for your medical care without any out-of-pocket expenses. Additionally, this system ensures that healthcare professionals are compensated for their services.
A portion of your personal injury settlement is allocated to cover medical bills and expenses stemming from the accident. These costs would not have arisen if the injury had not occurred. If you fail to pay those bills, you essentially gain an unfair advantage—receiving free medical care while also being reimbursed for it.
Allowing medical liens and subrogation claims on personal injury settlements helps prevent unjust enrichment. Fortunately, New York injury victims benefit from state laws that offer protection against certain liens.
Are There Additional Costs Deducted From My Personal Injury Settlement?
When you receive your personal injury settlement, your attorney will first deduct their fees and any related costs before issuing you a check for the net amount. In New York, personal injury lawyers typically work on a contingency fee basis, which means their fees are a percentage of the settlement you receive. It’s important to note that if your lawyer is unable to recover any funds for your claim, you will not owe them any fees. The percentage you agree upon will be established when you hire the lawyer.
Many personal injury law firms will cover the costs incurred during the case on your behalf. Once your settlement is finalized, the attorney will reimburse the firm for those expenses. The total costs can vary based on the specifics of your case.
If you have any questions about liens, fees, or costs, make sure to discuss them with your personal injury attorney during your free consultation.
Contact Our Award-Winning Personal Injury Lawyers Today
If you require legal assistance, reach out to the personal injury lawyers at Rosenberg & Rodriguez in New York City to schedule a free consultation at your nearest location. We are dedicated to helping you obtain the compensation you deserve for your injuries. Our experienced attorneys will expertly guide you through the legal process and advocate for your rights every step of the way. You can trust us to handle your case with care and commitment, as we work tirelessly to secure the justice and financial recovery you deserve. Don’t hesitate—contact us today! If you’ve been injured in an accident or due to someone else’s negligence, our skilled team of personal injury lawyers is here to help.
