Watch out for the Conflict With Medical Providers

When a person is involved in an automobile accident, in order to physically recover, a victim must seek qualified medical assistance.

When a person is involved in an automobile accident, in order to physically recover, a victim must seek qualified medical assistance. Depending upon the nature and extent of the personal injury, medical care can consist of hospitalization, surgery, therapeutic care, diagnostic care, dental care and various other forms of treatment. If a victim has health insurance many billing problems can be alleviated as provider bills can be paid by the health insurance carrier while treatment is being received. However, what happens when the personal injury victim has no health insurance coverage? In most instances providers must render care on letters of protection and liens which creates an interesting dilemma. If the injury victim has no health insurance to pay the cost of medical care, providers often try to access what is known in the industry as medical payment coverage which is contained in many automobile insurance policies. In general, medical payment coverage will pay the ordinary costs of medical care incurred in an accident up to the coverage limitations. Medical payment coverage is contractual in nature and is often paid by insurance companies without a review of the reasonable costs of the treatment. Many injury victims claims are ruined when medical payment coverage is paid beyond the point of "reasonableness". In most liability situations, medical payment coverage must be reimbursed when a case is settled. Therefore, if the medical payment carrier pays more than the reasonable cost of the treatment, the patient/victim ends up losing out on entitled proceeds. Example:

  • Victim A goes to doctor B and incurs 4 months of treatment billed at $7,000.
  • Victim A has a $10,000 medical payment policy on his automobile insurance.
  • Doctor B submits $7,000 in bills to Victim A's Medical Payment Coverage.
  • Doctor B is sent a check for $7,000 under the medpay.
  • Doctor B is very happy as he has been paid in full!
  • Victim A now submits his Liability claim to Insurance Company C who tells Victim A his case is only worth a total of $7,500.
  • Insurance Company C tells Victim A that his bills and treatment rendered by Doctor B are excessive.
  • Insurance Company C tells Victim A the reasonable cost of treatment with Doctor B is $3,800 and general damages on Victim A's care are worth $3,700.
  • Insurance Company C offers Victim A a total settlement of $7,500.
  • Insurance Company C also tells Victim A, by the way, we have a lien from your medical payment insurance carrier for reimbursement of the $7,000 in medpay coverage in the amount of $7,000.
  • Insurance Company C sends Victim A a release of claims to sign and a check for $500.
  • Victim A's head is spinning. What do you mean I only get $500?
  • Victim A then calls an attorney.

What is the likelihood that Doctor B refunds any of the $7,000 received?

This situation happens time and time again. I can't count the number of consumers who have called my office with similar fact patterns after their medical providers have been paid in full through medical payment coverage. WARNING: Do no let your treating providers bill the medical payment coverage without an attorney being involved to make sure that the provider is only paid the reasonable sum for services. Allowing your provider to bill directly to medical payment coverage will likely result in loss of settlement funds to you as the injury victim. Watch out for medical providers who tell you that you do not need an attorney and they can handle everything on your behalf. Warning bells should be going off in your head when statements like this come out of medical providers mouths. If this situation is happening to you right now, call me to discuss this situation. 513-579-8900

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