Most people get confused about how medical bills are handled after a car or truck wreck.  Does the health insurance pay? Does the "at fault" driver's company pay? What about my insurance company, why should my company pay when it wasn't my fault? How about medicare, is it primary?

All of these questions usually come up in my first interview with prospective clients. The main thing that you need to know is that the "at fault" insurance carrier will usually write two checks.

The first check is for the damage to your property. If the car is not totaled this first check is to pay for the cost of repair, loss of use of your vehicle during the repair process and for the diminuiton in value of your now wrecked and repaired car. The issue of diminution in value will be address at a later time. If the car is totaled this first check will be for the value of the car at the time of the wreck, plus loss of use, sales tax, and the expense of the tag and title.

The second check will be for ALL medical expenses, lost wages, all out of pocket expenses and other costs related to you injury and for all past and FUTURE pain and suffering. There is no obligation for the "at fault" insurance company to make partial payments and therefore almost always the final payment will be made to cover all economic and non-economic losses. So, don't get frustrated when this insurance company won't pay the bills as you send them in. Of course, if you accept the check and sign a release the claim is terminated. Therefore, taking any check from the insurance company is dangerous particularly if there is a release either in a separate document or language on the back of the check.

So how do you pay your bills?  Well, if your car policy has med pay coverage, that is where to start. Send the bills to the adjuster with your company handling your med pay coverage and those bills will be paid up to the policy limits of coverage. This amount should be clearly shown on your policy. And, don't be alarmed that this may affect you rates. This is coverage you have paid for as part of your premium and as long as you were not at fault there should be no adverse affect on your future premiums.

Beyond the coverage of your car insurance, your health insurance is also available. This is true even if your carrier says it won't pay because it is a car wreck. The obligation to pay is not affected by the fact that the injury occurred in a car accident. Of course, after payment the health insurance carrier will probably contact you to determine whether the injury was accident related. If so, reimbursement may be demanded. Whether or not health insurance reimbursement is required depends on several factors which will not be discussed here. Much depends on the particular status of the health plan as can be seen in a previous blog entry. Contact me if you have any particular questions about health plans and their right to recovery. 

Medicare is another story. Currently medicare is considered secondary. If medicare pays, you will be required make reimbursement. This is problematic for many claimants and is extremely difficult to deal with in most instances. The procedure is time consuming and because of penalties possible under federal law the "at fault" insurance company will not release the funds under most circumstances without some assurance that Medicare's interests are protected.

Once you have completed all your treatment attorneys compile the medical records, including all narrative reports, and all the bills. The attorney then prepares a demand package with time limited features. The case is then settled or suit if filed. Of course all cases have time limitations which could bar your claim if the suit is filed too late. Each state has its own statute of limitations, as well as ante-litem notice requirement for claims against the local, state, or federal government.