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Where Health and Casualty Insurance Meet Following an Accident

If you carry health insurance, you expect that the health insurance will cover the cost of your medical care after your deductible and co-pay. However, when your medical treatment is the byproduct of an accident caused by someone else’s negligence, it may seem unclear whether your health insurance foots the bill or whether the casualty insurance (or the liability insurance for individuals and businesses that cover property and vehicle claims) covers the cost. Some people assume that they can send the medical bills to the casualty insurance, and they will pay the bills as they come to accrue. However, casualty insurance does not pay bills as they accumulate but instead makes settlement offers using the medical bills and records as evidence to support their offers. 

Health Insurance Subrogation

Subrogation is the substitution of one person or entity in the place of another concerning a claim, demand, or right. Therefore, health insurance subrogation is a process that allows insurance and self-funded health plans to shift the liability associated with these expenses to the appropriate party, meaning the person at fault (and, by extension, their casualty insurance). Missouri is an anti-subrogation state, meaning that the injured party does not have to reimburse their health insurance for claims made and paid related to an accident unless an exception applies. 

However, when it comes to how the US population is covered by health insurance, the exception is the rule. According to the Kaiser Family Foundation, in 2019, 49.6% of the US population was covered by employer-sponsored health insurance, Medicare-covered 14.2%, Medicaid covered 19.8%, 1.4% were covered under the military, 5.9% through the marketplace (or non-group insurance), and 9.2% were uninsured. 

Employer-sponsored health insurance, also called group insurance, is the largest source of available health insurance to the US public. Employer-sponsored health insurance is governed by a federal law known as the Employee Retirement Income Security Act of 1974 (“ERISA”). ERISA allows employer-sponsored plans to seek reimbursement for claims paid where other insurance (i.e., casualty insurance) applies. Because federal law supersedes state law, the employer-sponsored health insurance carriers may still seek reimbursement in Missouri. Failure to reimburse employer-sponsored health insurance carriers may result in the carrier refusing to pay for future treatment. 

Additionally, government-sponsored plans such as MedicareMedicaid, and VA/TriCare are also exempt from Missouri’s anti-subrogation law and can seek reimbursement. 

Medical Providers and Insurance

Typically, medical providers that accept insurance make contractual adjustments and arrangements with the health insurance providers so that the insurance providers receive deep discounts on the cost of medical care. Seeing an opportunity to be paid more for the same medical care, some medical providers will refuse to submit a bill to health insurance where they know casualty insurance is involved. Some may even file a medical lien with the insurance company, demanding to be paid out of the settlement. However, the Missouri Courts has determined that if the medical provider is aware that the patient has health insurance and the medical provider fails to timely submit that bill to the health insurance, they do not get to file a lien on the settlement and waive their right to recovery for the related bills.

The rules regarding health insurance third-party liability claims are complicated and not patient-friendly. If you or someone you love has been injured and needs help navigating your claim, contact us for a free consultation.

Typically, medical providers that accept insurance make contractual adjustments and arrangements with the health insurance providers so that the insurance providers receive deep discounts on the cost of medical care. Seeing an opportunity to be paid more for the same medical care, some medical providers will refuse to submit a bill to health insurance where they know casualty insurance is involved. Some may even file a medical lien with the insurance company, demanding to be paid out of the settlement. However, the Missouri Courts has determined that if the medical provider is aware that the patient has health insurance and the medical provider fails to timely submit that bill to the health insurance, they do not get to file a lien on the settlement and waive their right to recovery for the related bills.

The rules regarding health insurance third-party liability claims are complicated and not patient-friendly. If you or someone you love has been injured and needs help navigating your claim, contact us for a free consultation.

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