Insurance Companies and Claim Payment

[insuremojo]

insuremojo, your just arguing semantics. John's posts are actually correct... just simplified to avoid turning into a book.



About the only time I'd not consider recovery of funds paid, subrogation, is when a carrier makes a payment they did not owe to begin with. An example; A carrier requests to be paid by another carrier as they claimed they were subrogated to a right of recovery. The carrier pays but then later finds out they were not required to pay those funds. REQUESTING THE MONEY BACK WOULD NOT BE SUBROGATION AS THEY'VE NOT ASSUMED ANY ONE'S RIGHT OF RECOVERY. They are simply trying to get back a payment they should have never made.

You make my point for me (see highlight portion of your post). All I was saying was that johnp was not illustrating subrogation but instead was talking about double dipping. IMO.

If the injured party sues for unpaid medical bills that were in fact paid THEN the health company CAN take that money but double dipping is illegal and should not be done in the 1st place. What if the million dollar judgement was for pain & suffering and lost future wages? Could the insurance company come in and take that money then? I don't think so....as long as it is not payment for medical bills that were claimed to be unpaid but in fact were? Too many variables. In retrospect, if the accident was not your fault then this should be a null and void discussion because the liable parties insurance should be the one responsible for paying all medical bills (up to their selected limits). Any remaining medical bills should not be billed to YOUR health insurance company but rather you would sue the liable party (as long as their were sufficient assetts). If no sufficient assets then you're up a creek and would probably have to send those bills to your health insurance company who could attempt to subrogate from the liable party themselves but you CANNOT then sue for the unpaid medical bills. You could sue for pain & suffering and lost future wages among other things.

 

[ToddC]

You make my point for me (see highlight portion of your post). All I was saying was that johnp was not illustrating subrogation but instead was talking about double dipping. IMO.

If the injured party sues for unpaid medical bills that were in fact paid THEN the health company CAN take that money but double dipping is illegal and should not be done in the 1st place. What if the million dollar judgement was for pain & suffering and lost future wages? Could the insurance company come in and take that money then? I don't think so....as long as it is not payment for medical bills that were claimed to be unpaid but in fact were?

A person can obtain a judgement for anything they want... paid or unpaid already. That is, a person's health insurance carrier could pay all the medical bills. The person could then either accept a payment for medical bills from the at fault parties liability carrier or obtain a judgement for that amount. So, yes... they _can_ "double dip". It then becomes the health carriers responsiblity to recover... or subrogate... from their insured for the money they spent on the medical bills...they need to show some right of recovery, though. This could be in the form of policy wording (secondary to all other recovery) or a lien. To be honest, health carriers almost always pay for such things as injuries in automobile accidents and they seldom seek recovery. I've also paid injured person's for medical expenses even though they were paid by the health carrier (as this is required). Some times this payment might go directly to the health carrier but 99.99% of the time I pay it to the injured person and obtain a release stating if the health carrier seeks recovery, he/she would be responsible for that.

But in any case, we were discussing what subrogation was. In all these cases, the health insurance company recovering money from their own insured would still be "subrogation" as John mentioned, as long as it was a payment they owed initially. Then it's called "getting your darn money back"!

 

[Crabcake Johnny]

My bro's an attorney and referred me to one of his friends who clarified it. Let's not use an auto insurance example but say you slipped and fell in a grocery store and they were negligent. Say you broke your hip, really messed yourself up and medical bills came to $50,000.

Now you sue but you can only sue for pain and suffering and what you incrurred in medical expenses. If you only paid $5,000 and your company picked up the rest you obviously can't add the other $45,000 into the lawsuit. However, your insurance company can indeed seek to recover $45,000 from the liable party if you have that clause in your contract.

You'll still walk with your judgement for the $5,000 you paid out of pocket and whatever the jury awared for punative damages, but you obviously cannot recover the $45,000 the health insurance company paid. If you tried to somehow sneak in the $45,000 for medical expenses and actually received the money then your health insurance company could seek to recover directly from you if and when they caught it.

 

[ToddC]

My bro's an attorney and referred me to one of his friends who clarified it. Let's not use an auto insurance example but say you slipped and fell in a grocery store and they were negligent. Say you broke your hip, really messed yourself up and medical bills came to $50,000.

Now you sue but you can only sue for pain and suffering and what you incrurred in medical expenses. If you only paid $5,000 and your company picked up the rest you obviously can't add the other $45,000 into the lawsuit. However, your insurance company can indeed seek to recover $45,000 from the liable party if you have that clause in your contract.

You'll still walk with your judgement for the $5,000 you paid out of pocket and whatever the jury awared for punative damages, but you obviously cannot recover the $45,000 the health insurance company paid. If you tried to somehow sneak in the $45,000 for medical expenses and actually received the money then your health insurance company could seek to recover directly from you if and when they caught it.

I'd only add one thing.... by saying "caught" it seems to imply that you're doing something wrong. You would not me. The liability carrier would not be responsible for paying the health carrier (if no lien had been filed). It's the _injured person_ who could be held accountable for paying back the health carrier _once the judgement was awarded_. So the injured person would argue that they _would_ be responsible for paying back the health carrier... and they would be correct. If the liability carrier has a lien from the health carrier they would point this out prior to the judgement so that they could satisfy that binding lein upon them.

So, the injured party could/would collect the payment for the medical bills.... already paid but then the health carrier would need to collect from that injured party for the amount their policy states they can recover.

(Actually in some states, I think Florida is one, you can actually "double dip" and the health carrier may not be able to recover. It depends on the state and the health insurance policy wording, in this case).

 

[Crabcake Johnny]

I wonder if the health insurance company could sue a third party even if you didn't. Imagine your out of pocket was already satisfied and a $50,000 medical bill was incurred as a result of a negligent party. You owe nothing and insurance picks up the entire tab. For whatever reason you decide not to sue even though it's a clear cut case of negligence. Could the health insurance company sue the third party directly?

 

[insuremojo]

So, the injured party could/would collect the payment for the medical bills.... already paid but then the health carrier would need to collect from that injured party for the amount their policy states they can recover.

(Actually in some states, I think Florida is one, you can actually "double dip" and the health carrier may not be able to recover. It depends on the state and the health insurance policy wording, in this case).

Why sue for unpaid medical bills when they've been paid? Let the health insurer incur the extra legal bills to subrogate those from the liable party.

LOL haven't you seen the PEOPLE'S COURT? "You're trying to win a judgement for bills you didn't pay out of pocket? Show me your receipts & prove it! LOL get out of my courtroom!" That's the point of subrogation...and you're right the health insurer will pick up the bills and may/or may not subrogate but you should leave the ball in their court.

Great discussion by the way

 

[ToddC]

I wonder if the health insurance company could sue a third party even if you didn't. Imagine your out of pocket was already satisfied and a $50,000 medical bill was incurred as a result of a negligent party. You owe nothing and insurance picks up the entire tab. For whatever reason you decide not to sue even though it's a clear cut case of negligence. Could the health insurance company sue the third party directly?

Actually no, they could not. It's an odd situation. The health carrier has a right to collect... only _if_ the liability carrier issues a payment. They health carrier cannot initiate the claim as they've not suffered the loss (rememeber, they made a voluntary payment under their policy). What they can do is to file a lien with the liability carrier. This means if the liability carrier issues a payment, they need to pay the health carrier back as well. The health carrier would not have a right to make the liability carrier settle the claim, only seek recovery if a payment was made.