What is a personal injury?
Personal injury is any physical or psychological harm suffered by an individual due to the wrongful conduct or negligence of another person or entity. Most personal injury cases are based on a type of negligence, which in lawful terms means failure to use ordinary care by someone who owes you a duty to be aware of the consequences of their actions or omissions.
Personal injury claims and lawsuits can be brought against a negligent person to recover for a victim's medical bills, property damage, other actual monetary expenses incurred, pain and suffering, and possibly "exemplary" or special damages allowed for malicious or grossly negligent behavior.
Every month you pay your medical insurance premiums; every month you pay to protect you from the “what ifs” of life. If you are fortunate enough, you may not ever have a need for medical insurance, but many because of tragedy, old age, or for countless other reasons rely on medical insurance to cover them when they need it most, including unexpected injury and accidents.
Imagine Ian the Insured. Ian gets in a car accident and is injured by Dan, who ran a red light. Ian suffers significant injuries, undergoes surgery, and is hospitalized for a long time. By the time Ian has made a full recovery, he has $40,000 in medical bills, but since he has medical insurance, the insurance company pays most of the bills for him. Ian then decides to file a suit against Dan. Dan’s insurance policy has a $50,000 limit, and offers that to Ian as a settlement. Ian’s medical insurance in turn can reimburse themselves, or subrogate for the medical expenses they paid for Ian, in this case $40,000, leaving Ian with only $10,000 for pain and suffering compensation.
This right to reimbursement by Ian’s insurance is what is called a subrogation, and can result in a subrogation lien on Ian’s personal injury claims. In Ian’s health insurance contract, there is language that will essentially say, if the insured is injured due to a third party’s negligence or intentional act, and gets a settlement from the third party’s insurance, then Ian’s health insurance is entitled to pay themselves back from that settlement. Ian and his lawyer’s may even have a legal duty to be sure the ins. Company has a chance to make that claim.
Ian pays his insurance company month after month, and before this accident, the sum of those premiums could have been in the thousands. Isn’t this the exact situation for which he pays those premiums? So is it fair that even after Ian has paid those premiums that his insurance company can reimburse themselves, with Ian’s settlement money? It is not, and that is the spirit of HB1869, which took effect January 1, 2014.
HB1869 limits the amount certain health insurance plans can reimburse themselves against a third party personal injury settlement. However, not all health insurance plans are covered, among those NOT covered are: Medicare plans, Medicaid plans, CHIPS, Workers Compensation plans, and self-funded ERISA (Employee Retirement Income Security Act) plans. Those that ARE subject to the limitations created by HB1869 are: state employee coverage plans, insured ERISA plans and every other health insurance plan and non-ERISA self-funded plans that are sold in Texas.
The limitations placed on how much a health insurance plan covered by HB1869 can take from a settlement depends on whether an insured person is represented by an attorney or not. If the insured has legal counsel, then the most an insurance company can reimburse, or subrogate, themselves is limited to one third of the total settlement. If an attorney does not represent the insured, than the insurance company can take up to half of the settlement.
For the insured people of Texas, this means that they are able to keep more of their personal injury compensation.
For more information or help with a personal injury case, call us now at (830) 629-6955.
It is wise to retain an attorney immediately after an accident or injury to protect yourself from those who may not be so invested in your best interest.
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Our firm's services start immediately after your accident and continue until you are satisfied. Our services include evidence gathering, investigation, confrontation of the issues and negotiations with your insurance company and the opposing party. If you have suffered, you need a savvy advocate to maximize your benefits and enhance the quality of your recovery.
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