After I Settle My Injury Claim, Is My Health Insurer Entitled to Reimbursement ?


Let us imagine a situation where we have litigated your Georgia personal injury case and the insurer has finally come to their senses and has agreed to settle the case. One huge question is, will I have to reimburse my health care insurer out of the settlement? The answer is maybe. This is an extremely complex area of law and if your medical care is paid by insurance then it makes sense to hire a car accident injury lawyer but for the sake of this conversation, here are some general truths:

First I will order a copy of the policy to review the policy language to see if it entitles the plan to reimbursement from the settlement. These days, most of the health insurance plans issued in Georgia have refined their language to permit their recovery.

Second, we send certified letters to the plan to find out whether it is self-funded or insurance funded. Some plans are funded by employee contributions and others are just premiums paid to a third party insurer. The name, United, Blue Cross etc. is not determinative. What is critical is whether the plan is self funded. If the plan is self-funded, then Federal law will pre-empt Georgia’s consumer friendly “made whole doctrine.”

If the plan is insurance funded though, my client is in good shape. As most good lawyersknow, the plan is not entitled to reimbursement unless the client was made whole. Duncan v. Integon Gen. Ins. Corp., 267 Ga. 646 (1997); Davis v. Kaiser Found. Health Plan, 271 Ga. 508 (1999), In other words, how good of a recovery did they make? The closer to full value to the settlement comes, the more likely the client was made whole. In most cases though we can prevent the health plan from obtaining reimbursement from the client. One exception is where the client is still insured with the same plan because the plan may just chose to withhold future payments until the reimbursement is made. You would win the battle but lose the war in that situation.

Finally, even if we do owe reimbursement, we are able to negotiate the health insurer down to as much as 50% of the amount they paid.

These are complex issues and one of the factors that should play into your decision on which lawyer to hire is how knowledgeable they are with regard to reimbursement issues.

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