Dealing with a Lien on Your Personal Injury Settlement

After being hurt in a personal injury accident, it’s likely you’ll need immediate care for your injuries. However, you may not have the funds to pay for your treatment out of pocket.

Fortunately, Florida law allows a hospital to treat you with the understanding that they will collect payment out of the proceeds you receive in your personal injury settlement. Navigating the process of dealing with a lien on a personal injury settlement can be confusing, but working with the right personal injury attorney — someone who has experience navigating personal injury settlement liens — can significantly impact how much settlement funds you walk away with. 

The attorneys at Jack Bernstein, Injury Attorneys, can help you understand personal injury settlement liens, including medical, insurance, government, and child support liens.

Contact our team today to schedule your free case evaluation and learn more about your options for recovering the full compensation you deserve after a personal injury settlement lien.

What Is a Medical Lien? What Is a Lien on a Personal Injury Settlement?

In the world of personal injuries, a lien is a legal claim to a portion of a personal injury settlement or a judgment that’s been awarded to you. There are a variety of liens that can come into play after a personal injury settlement has been reached. 

If a party, like a medical provider, pays for the cost associated with a personal injury, they have the right to pursue a lien against the personal injury settlement funds an injured person receives to recover expenses paid on a victim’s behalf.

Medical liens are one of the most common types of liens placed on personal injury cases simply because most people don’t have the funds to pay out of pocket for necessary medical expenses.

Although medical providers are common lien holders, other potential lien holders can include health insurance companies, government agencies, and other parties with a stake in your settlement. These potential lien holders will be paid out first before you can collect the remaining funds from your settlement.

Related: Understanding Taxes on Your Personal Injury Settlement

Who Can Place a Lien on a Personal Injury Settlement?

It’s common for attorneys to take a percentage of your settlement funds as this is how their attorney’s fees are paid out in most cases. However, other entities you might not be aware of can also place a lien on your settlement funds as a way to recover payment they’re owed.

If there is an entity or agency that has paid expenses on your behalf, such as medical care or medical services, they can place a lien on your settlement funds to recover the money they’ve spent. This includes but is not limited to medical care providers, hospitals, and even ambulance companies. Government entities can also intervene in your settlement payout, as they can recover expenses on behalf of Medicaid or Medicare that were paid out on behalf of your recovery. 

Additionally, private healthcare insurance providers might put a lien on your settlement if you’ve been involved in a car accident, and even child support agencies can place a lien on your settlement. Through this process, you have a legal obligation to pay them as well.

Types of Liens on Personal Injury Settlements

Liens on personal injury settlements vary and depend largely on the type of personal injury you suffered, and the unique circumstances of your case. Let’s take a closer look at the different types of liens that can exist with personal injury settlements in Florida.

Medical Liens 

Medical liens are one of the most common types of liens an injured party might face and they typically result from healthcare providers who rendered medical care to an injured party without receiving payment for the the medical expenses and ongoing medical costs of their services. 

When this happens, a healthcare provider can place a medical lien on the injured party, allowing them to recover the cost of the medical treatment they provided. Through this avenue, personal injury victims can continue to receive treatment even as they work with their personal injury attorney to recover damages, which will then be paid out through a settlement.

It’s important to recognize that medical liens are governed by both state and county laws. For example, state laws can impact how insurance liens related to Medicare or Medicaid are carried out. While county laws play a role in how medical liens are filed.

Insurance Liens

Health insurance companies can also file insurance liens to help them recover medical costs that they covered because of your personal injury. In a process known as subrogation, health insurance companies have the right to seek reimbursement and receive payment for your medical expenses. You’ll often find this comes into play when victims are injured in car accidents and are required to turn to their health insurance after their personal injury protection (PIP) has been exhausted. 

Government Liens

Government liens can be placed on personal injury lawsuit settlements if they are related to Medicaid or Medicare insurance coverage. The authority to receive payment for medical care is dictated by federal law, and as such, these types of liens are required to be satisfied first before other liens a personal injury plaintiff might have. 

With that said, a personal injury victim could have several liens on their personal injury settlement. When this is the case, government agencies will always be paid first. 

Child Support Liens

Child support agencies can also place liens on a personal injury settlement if a personal injury victim is behind on their child support payments. Although not as common as medical or insurance liens, these types of liens are effective in helping children of injured victims receive settlement money they’re entitled to.

How Liens Affect Your Personal Injury Settlement

A personal injury settlement is one way to help you recover fair compensation after an injury, but liens on your settlement can reduce the amount of money you actually walk away with because you are obligated to pay your liens first.  

Liens can undeniably have a significant impact on your personal injury settlement, especially if you do not have medical coverage, are covered through Medicaid or Medicare, or have extenuating circumstances that required medical care beyond your insurance coverage.

In some cases, you might find yourself in a situation where there are multiple liens against your personal injury settlement. When this happens, the amount of money you recover in your settlement check after all liens are paid can be significantly reduced.

When you navigate a personal injury settlement alone or with an inexperienced legal representative, entitled lien holders, including the government, will pursue the compensation they may be entitled to to the fullest extent. 

However, working with an experienced personal injury attorney with detailed experience in navigating personal injury settlements and liens can be a great way to help you maximize your financial compensation. 

An experienced attorney will know how to identify potential lien holders, negotiate on your behalf, and reduce the total amount of the claims lien holders are after.

Related: Average Personal Injury Settlement 

The Lien Process in Florida

The lien process in Florida is lengthy, incorporates a multi-step process, and can be complex and overwhelming to navigate if you’re moving through it alone.

If you are facing potential liens against your personal injury settlement, knowing what to expect can help you plan ahead as your settlement payout finalizes.

As with all legal issues, there is a process potential claimants have to follow if they believe they have a claim to a portion of your settlement funds. 

In Florida, entities including healthcare insurers, Medicare, and hospital providers must give a formal written notice to a personal injury plaintiff about their claim. This starts the process for an entity to be able to place a lien on your personal injury settlement.

Once a claim notice has been filed, it’s your attorney’s job to read through these claims. They’ll work to identify potential lien holders from the onset, and they’ll communicate with each claimant to determine the validity of their claim and determine the amount of the lien they’re pursuing.

Florida state statutes govern the lien process in the state, with additional guidance offered at the county level.

The following are just some of the statutes that govern specific types of liens:

• Worker’s compensation liens are governed by Florida Statute § 440.39.
• Medicaid liens are governed by Florida Statute § 409.910.
• Hospital liens are governed by Florida Statute § 395.400.

This is where the expertise of an experienced attorney is invaluable. Your attorney will negotiate on your behalf with these potential lien holders, helping to minimize their claim, which will, in turn, allow you to recover more of your personal injury settlement.

Federal Priority Statutes and Lien Hierarchy

There’s also a hierarchy in how payments to other lien holders are made from your personal injury settlement as well. Generally, attorneys fees are paid first from your settlement funds. From there, government agencies like Medicaid and Medicare are entitled to receive payout next under federal law, the Medicare Secondary Payer Act (MSPA).

If you have multiple liens, then the other lien holders like child support agencies, insurance companies, and medical providers are paid out after that. Under state and county law, you have legal obligations to pay out valid lien claims before you can tap into the remaining funds from your personal injury settlement. 

Can You Negotiate a Lien Settlement?

Yes, there are some lien claims that you can negotiate, while others are considered non-negotiable. 

If you work with an experienced personal injury attorney, they’ll know tactics and strategies to use with lien holders to negotiate liens you might be responsible for. It’s important to recognize that some liens are negotiable, while others are non-negotiable. For example, government liens involving Medicare and Medicaid are the least negotiable because federal law entitles them to restitution for medical costs they’ve covered. Child support liens are also non-negotiable because of the nature of this type of debt.

On the other hand, health insurance liens offer more negotiability to help you minimize the amount of the claim. The same goes for liens brought on by healthcare providers.

While it’s difficult to eliminate liens, a good attorney will be able to minimize the amount of the lien so that you can recover more compensation from your settlement.

At Jack Bernstein, Injury Attorneys, our attorneys are experienced in navigating personal injury liens and are well-versed in successful negotiation strategies that will help you walk away with fair compensation from your personal injury settlement.

Car Accident Liens and Special Considerations

Liens involving car accident personal injury cases are more complex than medical and government-related liens. There are several reasons for this, including factors like Florida being a no-fault state, the involvement of PIP insurance, and the role your health insurance company plays when it comes to your medical treatment costs.

After a car accident in Florida, drivers are required to turn to their own personal injury protection coverage to cover the cost of medical expenses brought on by the accident.

In cases where a victim’s personal injury protection coverage does not cover all medical costs, a victim will then need to turn to their health insurance company. In this type of scenario, the health insurance company will then seek restitution from the personal injury victim if medical costs exceed coverage. However, in severe car accidents, the cost of medical care can quickly eat up any settlement funds you’re awarded.

An experienced personal injury attorney will know how to navigate your case from the start, helping you fight for damages including recovering lost wages from a personal injury and seeking damages that cover the cost of current and future medical expenses. If a lien is put on you by your health insurance company, you can still walk away with a fair settlement, even after the insurance lien is paid out.

How a Personal Injury Attorney Helps With Liens

A personal injury attorney with experience in lien management can make a significant difference in the amount of compensation you walk away with after a personal injury settlement.

Our experienced personal injury attorneys have first-hand knowledge of working with government agencies, insurance companies, and medical providers who intend to pursue a claim against your personal injury settlement award.

When you schedule your free case evaluation with our team, you can look forward to speaking with a personal injury attorney who will help you understand your legal rights and options as you move through the lien claims process. You’ll get insight into how they’ll manage the different claims you may be facing, how they negotiate lien claims, and potential outcomes that may result from your case.

Schedule your free case consultation to learn more about how the right legal representation can help maximize your payout, learn more about our attorney fees, and get the answers you’re looking for during the claims process.

Protecting Your Settlement From Liens

There are things that you can do to protect your settlement from liens. The first is seeking out the legal representation of an experienced attorney. By setting up a strong case beforehand, you can maximize your settlement funds even if liens follow. For example, an attorney who does a good job calculating existing and future medical expenses early on can plan for a fair outcome, even if liens play a role in your case down the line.

An attorney will also help you understand your financial obligations as you seek out medical care and what documentation to keep track of to help you recover expenses that were paid out of pocket to other involved parties like your health insurance company.

Most importantly, an attorney will help you understand your legal rights to challenge invalid liens, which will, in turn, help you maximize your payout. They’ll also help you understand your legal rights and equip you with the knowledge to move forward confidently. 

Common Lien Mistakes To Avoid

There are also some common mistakes to avoid during the lien claim process as well. For example, working with an inexperienced personal injury attorney or skipping out on the legal representation of an attorney entirely can cost you significantly when it comes to your settlement money payout.

If your medical care was covered through Medicaid or Medicare, you have legal obligations to pay back funds for expenses they covered.

It’s also important not to engage in DIY lien negotiations with insurance companies, medical providers, or other agencies before you speak with a legal expert. Failing to do so can result in significantly reduced personal injury settlement.

Working With Jack Bernstein, Injury Attorneys

At Jack Bernstein, Injury Attorneys, we have extensive experience negotiating medical liens for our clients and understand how crucial this is to the success of a case.

Our personal injury attorneys are committed to determining whether there are liens that apply to your case and strategizing what we can do to minimize your liens and maximize your payment.

If you have been injured and need help dealing with a medical lien, call us at (813) 333-6666 to schedule your free case evaluation. There is no fee unless we win.

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