Health Insurance Subrogation
Subrogation is a health insurance company’s ability to recoup money that they paid out. This frequently comes into play in the context of birth injury malpractice cases. It also applies to Medicare and Medicaid (medical assistance).
The way it works is that a health insurer or the government might pay for benefits after a birth injury—they could pay for extraordinary medical care like surgeries, medicine, assistive devices, therapies and the like. If the injured child or the child’s parents brings a successful claim for damages against a health care provider, the entity that paid for care may have a right to collect money they paid. Oftentimes, this right to reimbursement is spelled out in the health insurance contract.
Several states have statutes which provide for a minimum reduction in the amount payable to a health insurance company in this situation. As a birth injury settlement or trial gets closer, your medical malpractice attorneys will likely contact the insurer to determine exactly how much money they paid in benefits. The insurance company may be involved to some degree in settlement discussions, and your lawyers will do what they can to negotiate down the amount you must pay them from the settlement or verdict.
The reason they should reduce the amount owed is simple—in order to recover, children with birth injuries (and their parents) will have to pay attorneys’ fees and expenses. Absent a reduction, the insurance companies would receive a benefit (repayment of money) without paying a proportional amount of attorneys’ fees. Stated another way, they would get something for nothing. In most cases, their claims can be reduced, which increases the amount of money which can be used to fund the life care plan.
If you receive a questionnaire from your health insurance company asking whether your child’s injuries were caused by an accident or negligence, talk to attorney before you send it back. If you have questions about health insurance subrogation claims or medical liens, call us at (440) 252-4399 or contact us online.