What are personal injury liens?
Nearly each and every personal injury case has lien issues involved. These liens must be resolved at the time of settlement in order for the settlement funds to be properly distributed to all parties. Understanding what a lien is, as well as understanding the various types of liens, is important if you have an ongoing personal injury claim that will be settling in the future.
Liens are essentially legal interests asserted by parties that have a stake in the outcome of the case. For example, a provider of medical services or a health insurance company may file a lien against a personal injury settlement. That means the party asserting the lien is asserting a legal interest to the proceeds in connection with a personal injury case settlement. Here are some of the various types of liens that are asserted against personal injury claims.
1. Health insurance liens
Health insurance carriers have the right to assert a lien against a case. However, in order for a health insurance carrier to have a valid lien, they must file certain legal protocols. For example, it must follow specific statutory instructions. Additionally, they must send their lien letter via certified mail, return receipt requested.
Failure to follow any of these prescribed procedures may result in a lien being determined as faulty or invalid. Health insurance companies such as Harvard Pilgrim and Blue Cross Blue Shield, etc., are some of the larger health insurance companies that commonly assert liens on personal injury cases.
MassHealth is essentially Medicaid. MassHealth provides health insurance to hundreds of thousands of Massachusetts residents. When someone who has MassHealth has a personal injury accident, MassHealth typically pays the claimant’s medical bills or at least a portion of the claimant’s medical bills. When that happens, MassHealth asserts a lien.
However, unlike health insurance companies, MassHealth does not need to proactively assert a lien or follow any statutory guidelines when trying to assert a lien. That is because a MassHealth lien is asserted automatically against a case by virtue of the fact that the personal injury claimant has MassHealth insurance coverage. Therefore, it is wise for a claimant or the claimant’s personal injury attorney to contact MassHealth prior to or at the time of settlement to find out if MassHealth has a valid lien against the settlement.
Medicare is a Federal health insurance program which millions of Americans have. Medicare, like MassHealth, is a type of lien that is asserted automatically without Medicare having to do anything to perfect or assert their lien. Therefore, the lien rises automatically. Just like with MassHealth, it is good practice for the claimant or the claimant’s injury attorney to contact Medicare prior to or at the time of settlement to find out the exact amount of any Medicare lien that is asserted against the case.
However, unlike MassHealth, the Medicare lien process can take considerable time. Therefore, it is highly recommended to contact Medicare well in advance of any type of settlement because that way, there will be sufficient and ample time to determine if there is any Medicare lien that will be asserted against the case.
4. Hospital liens
Hospitals must follow specific statutory instructions in order for their liens to be enforceable. Like health insurance companies, they must file their lien by sending a certified letter, return receipt requested to the claimant and/or the claimant’s attorney. Failure to precisely follow the statutory guidelines can result in a hospital lien being rendered moot or invalid.
5. Physical therapists and chiropractor liens
Physical therapists and chiropractors often are not paid their full balance by health insurance providers. When that occurs, the physical therapists or chiropractic office will attempt to assert a lien against a personal injury settlement. These liens, however, are invalid. It is true that if the claimant has unpaid medical bills stemming from chiropractic and/or physical therapy treatment, the medical provider of those services can sue the claimant for any unpaid balance. However, in terms of asserting a lien against the case, that is not something that a physical therapist or chiropractic treatment provider can validly do under the Massachusetts Lien Statute.
In summary, liens are quite common with personal injury cases. It is the obligation of the claimant or the claimant’s attorney to handle any and all such liens. These lien issues can become very intricate and complex for the inexperienced.
If you have any further additional questions pertaining to personal injury law in Massachusetts, I encourage you to contact today the Law Office of Christopher Earley at 617-338-7400 for your free complimentary phone consultation. Keep in mind, these cases have very strict time guidelines that must be followed, and if they are not, a claim can be rendered invalid.