According Merriam Webster’s Dictionary, subrogation is “an equitable doctrine holding that when a third party pays a creditor or obligee the third party succeeds to the creditor’s rights against the debtor or obligor; also : a doctrine holding that when an insurance company pays an insured’s claim of loss due to another’s tort the insurer succeeds to the insured’s rights (as the right to sue for damages) against the tortfeasor.”
Basically, subrogation is a fancy way of saying an entity has a right of reimbursement. It applies in many ways in a personal injury claim (it comes up in car accidents, motorcycle accidents, pedestrian accidents, bicycle accidents, slip and falls, trip and falls, etc.). Today we are going to focus on a health insurance company’s right of subrogation in personal injury cases.
Many individuals injured in a personal injury incident believe that they have health insurance and that they do not have to worry about outstanding medical expenses. This assumption is incorrect; health insurance companies will apply deductibles, co-pays, deny coverage and/or seek subrogation.
In a personal injury case a health insurance company may assert a right of subrogation. Basically, the health insurance company is stating that they want to be reimbursed for any medical expenses that they pay that are related to medical treatment incurred as a result of a personal injury claim. In a nutshell, if the individual is injured as result of another’s negligence, the health insurance company may have a right to be paid back for medical expenses.
The concept of subrogation can become extremely complicated based on the injured individuals specific health insurance policy. Some health insurance policies have contractual right of subrogation; meaning the right of subrogation is written into the insurance agreement. Other health insurance policies have a statutory right of subrogation; meaning that the law gives the health insurance companies a right of subrogation.
Generally, if a health insurance company has a contractual right of subrogation, it must put their insured (the injured individual) on notice of the insurance company’s claim to get reimbursed. This notice should be sent to the injured individual (or their attorney) in writing. In addition, if a health insurance company has a contractual right of subrogation, it may be required to reduce its claim for repayment if the injured individual had an attorney assist in the settlement of the injury claim.
However, if a health insurance company has a statutory right of subrogation (ERISA), the insurance company is not required to put their insured (the injured individual) on notice of the insurance company’s claim to get reimbursed. The law basically makes it the insured’s responsibility to contact their health insurance company and make sure the health insurance company is reimbursed for any payments they made towards medical treatment. This is extremely counterintuitive and can become extremely problematic for an injured individual that is trying to resolve a personal injury case.
Health insurance and its involvement in a personal injury case may become extremely complicated and extremely confusing. It is extremely important that if you or a loved one were injured in a personal injury incident that you seek help from an experienced personal injury attorney.
If you or a loved one were injured from an accident, please contact us at Thacker and Mulvihill, PLLC for a free consultation. Care, Compassion, and Preparation: Florida Personal Injury Law As It Should Be