A lien in a personal injury case refers to a subrogation claim. A subrogation claim or lien in a personal injury case is a third-party’s legal right to your settlement proceeds or jury verdict because of money they are owed. Subrogation claims may be filed by health care providers and some insurance providers.

Liens may apply in all types of personal injury cases, including car accidents, workplace injuries, slip and fall accidents, and medical malpractice claims

However, New York laws restrict who can file a lien against the proceeds of a personal injury case. A New York City personal injury lawyer can determine whether you are required by law to pay a lien in a personal injury case and negotiate with the lien holder to potentially lower the amount you must pay. 

Who May Be Entitled to a Lien on Settlement Money for a Personal Injury Claim?

New York General Obligations Code §5-335 limits subrogation claims and reimbursement of specific parties in personal injury and wrongful death cases. Most health insurance providers are not entitled to reimbursement for medical bills they paid related to a personal injury case. 

However, the law does not apply to federal public health insurance providers under Medicaid or Medicare. It also does not apply to insurance companies in no-fault settlements, self-funded ERISA health plans, and workers’ compensation insurance. As a result, these parties can assert a lien against the money you receive for a personal injury claim. 

According to New York Code LIE §189, hospitals have liens on the proceeds of personal injury cases for the unpaid bills related to the treatment of the injury or health care condition. Furthermore, the restrictions against subrogation claims generally do not apply to medical providers. 

Suppose your physicians and other medical providers agreed to provide treatment in exchange for payment of services from your settlement proceeds or jury verdict. In that case, those medical providers can exercise a lien on the money you receive. Subrogation liens must be paid before you receive any proceeds from the settlement or award.

Negotiating a Settlement for Subrogation Liens in a Personal Injury Case

Your personal injury attorney is obligated to verify liens and pay liens in personal injury cases. First, your attorney researches each lien to ensure the party has a valid, legal lien on the settlement proceeds. If not, your lawyer can challenge the lien in court. Some liens may not be enforceable. 

Some parties with liens on personal injury proceeds may negotiate a lower amount to satisfy the lien. Your lawyer should try to negotiate those liens to keep more money in your pocket. Special rules apply to Medicaid liens. Medicaid providers may only be entitled to a percentage of their lien, depending on the settlement and damages. 

However, other parties are not obligated by law to negotiate a lien on your settlement proceeds. It helps to have an experienced, aggressive New York City personal injury lawyer working for you in those cases. 

Your attorney can review each bill the provider submits for reimbursement to ensure the services related to the injury case. Furthermore, your attorney understands how to present a compelling argument why the provider should accept a lower amount to settle the subrogation claim. Negotiating on your own could result in receiving less money for your claim.

Can I Ignore a Lien in My Personal Injury Case?

A lien is a legal right. Therefore, it is not advisable to ignore a lien. If the medical provider or other party has a valid lien, they can pursue that lien in court. 

The party may file a lawsuit against you and your lawyer seeking payment of the lien. Furthermore, the party may ask for reimbursement for damages caused by your failure to pay a valid lien. As a result, you could lose more money than had you negotiated a settlement of the subrogation lien when you received your settlement proceeds.

What Should I Do During My Personal Injury Case Regarding Liens?

Check with your personal injury attorney before signing any documents regarding subrogation liens or medical liens. You may not have a choice but to sign the agreement or lien to continue receiving medical treatment. First, however, your lawyer should review the agreement to ensure it is fair and legal.

It is also helpful to track all medical expenses and payments. Keep records of each medical bill and who pays the bill. Most insurance companies provide monthly statements detailing payments to medical providers. This documentation can help your lawyer prepare to negotiate a subrogation lien. 

Notify your lawyer if you receive Medicaid, Medicare, or workers’ compensation benefits because of a personal injury. These parties can be difficult to negotiate with, so it helps to prepare in advance of the settlement. Keeping track of these payments also helps you know how much you might need to pay to satisfy liens as you negotiate a personal injury settlement.

Contact Our Personal Injury Law Firm in New York City

If you’ve been injured in an accident in Manhattan, NY, and need legal help, contact our New York City personal injury lawyers at Rosenbaum & Rosenbaum, P.C. to schedule a free consultation.

Rosenbaum & Rosenbaum, P.C.
100 Wall St 15th Floor
New York, NY 10005
(212) 514-5007