When the Hospital Won’t File Your Health Insurance…

When you have suffered a serious personal injury as a result of someone else’s negligence, you will most likely find yourself in a hospital for your initial medical treatment. In our neck of the woods (Fayetteville, NC), the hospital is most likely a facility owned by Cape Fear Valley or First Health. When you check into the E.R., you will be asked to disclose your health insurance information on the intake forms. Most people assume that any bills they incur will be filed with their health insurance carrier and paid accordingly.

Who Really Pays the Bill?

A problem arises when the hospital refuses to file your balances with your health insurance carrier. If there is another source of payment available, like the liability insurance of the person who caused your injury, the hospital may decide not to file your health insurance and instead receive payment from the other source.

This frustrates most people, and unfortunately, as attorneys practicing personal injury law in Fayetteville, we see it often. It is especially common in motor vehicle collisions, where hospitals will seek payment from the liability coverage of the at-fault driver or even the Med Pay, Uninsured, or Underinsured motorist coverage of your auto policy. The end result: it can be months, even years, before your hospital bills are paid. To make matters worse, if you have a personal injury claim, the hospital will put a lien on any money you receive in a settlement or judgment.

Follow the Money

Why wouldn’t a hospital simply file your health insurance instead of waiting? The answer is simple: the hospital often gets paid more money by not filing. Most health insurance companies have contracted rates with medical providers. This means the health insurance carrier only has to pay a percentage of your total bill. The remainder is often “written off.” Look at any medical bill your health insurance paid in the past, and you will see these “adjustments” in the margins.

By seeking payment from a 3rd party source like liability insurance, the hospital can be reimbursed for your entire bill, not the lesser percentage it would receive by filing your bill with your health insurance. It’s a money game, and injured victims are caught in the middle!

Is this legal?

Unfortunately, North Carolina courts have held that hospitals can choose not to file your health insurance. It’s their choice. In addition, the hospital can put a lien on any money you receive for your injuries from another source (typically the at-fault party’s insurance). This is all well and good until you begin to deal with the liability insurance company. There you may find that a settlement offer isn’t large enough to pay your hospital bill and compensate you for other damages like pain and suffering or lost wages.

What it Means for You

This article only touches on one of many issues that arise in our complex game of medical billing in personal injury claims. If you’ve stumbled on this post, you probably have additional questions that relate to your particular case. Our attorneys will be happy to provide you with a free consultation to see if we can help.