Collateral sources, such as health insurance, workers’ compensation, Med-Pay, Medicare, and Medicaid, which pay the medical expenses of an injured party arising from a third party’s negligence acquire a subrogation or reimbursement right in payments made to the injured party by the third party. (In Florida, Personal Injury Protection (PIP) insurance is the main exception to the rule. It does not acquire subrogation rights.) Failing to honor the right can have serious consequences against both the injured party and his or her attorney.
There is little debate that payments made before a case is settled or judgment is entered are subject to the lien. Less certain is whether payments made post-settlement or -judgment for services incurred pre-settlement or -judgment are subject to the lien.
Not all subrogation rights are alike. Subrogation rights are determined by law and contract. In Florida, payments from the collateral sources outlined in §768.76(2) Florida Statutes are subject to §768.76(8), which provides as follows:
Reimbursement of a collateral sources provider pursuant to this section shall satisfy such collateral sources provider’s right of subrogation or reimbursement. The provider shall have no right of subrogation or reimbursement for collateral sources payments made after the date of waiver, settlement, or judgment.
While Florida’s appellate courts have not ruled on the specific issue, most Florida personal injury lawyers interpret the second sentence broadly to include payments made after settlement or judgment for medical services furnished before settlement or judgment. In other words, the right of reimbursement does not apply to any payments made [by the collateral sources defined in §768.76(2)] after settlement or judgment.
There is little doubt Medicare and Medicaid have reimbursement rights for payments made after settlement or judgment for medical services rendered before. The risk of exercising an alternative view by failing to respect the right can be consequential, including being sued by the government and criminal prosecution. Accordingly, it is exceedingly important to determine how much has been billed to Medicare and Medicaid before fully disbursing the proceeds of any case recovery. There are numerous ways of doing this, some more precise than others.
For payments by collateral sources controlled by §768.76, the issue sometimes arises as to when a case has settled. There are two positions: The case is settled when the parties have reached agreement or when the settlement release is fully executed. The sounder of the two positions is that a case is settled when the agreement is reached. For one thing, the settlement is enforceable at this point in the event a party tries to back out. (There are too many cases to cite here in support of that proposition.) For this reason, among others, including the reimbursement issue, we immediately confirm every settlement in writing or by email.
Contact us toll free at 866-785-GALE or by email to learn your legal rights.
Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.
While prompt resolution of your legal matter is our goal, our approach is fundamentally different. Our clients are “people” and not “cases” or “files.” We take the time to build a relationship with our clients, realizing that only through meaningful interaction can we best serve their needs. In this manner, we have been able to best help those requiring legal representation.