People who are the victims of a car accident tend to make one big mistake when they are taken to the hospital: they give the other driver’s auto insurance information to the hospital. I understand why: they think that the car accident wasn’t their fault, so someone else should pay. But that’s not how things work in the state of Colorado. Sadly, that single decision can end up costing them thousands and thousands of dollars.
If you share one article with your friends and family this year, make this the one. And if you’re going to stop reading right here, take away this single piece of information: always give your own health insurance information to the hospital after a car accident to cover medical bills. It could save you thousands of dollars.
Here are the top 5 reasons why you should give your own health insurance to the hospital after a car accident for medical bills:
- Hospitals can’t do anything with the other driver’s insurance. Nada. Zip. They will not be paid by the insurance company. They will be paid by YOU after you win your case against the other driver. (If you give your health insurance information, your health insurance pays for your care.)
- When you give the other driver’s insurance card to the hospital, they immediately know that there’s going to be a legal case and they may put a lien on your case against the other driver. This means, they will hold onto all of their medical billing until they know the outcome of your case. Why is this bad? Read on.
- When the hospital puts a lien on the case, they are actually trying to get more money for your care than they would get if you gave them your health insurance information. (They have to charge lower negotiated rates to health insurance providers than they can take from your settlement.)
- The lien on your case from the hospital could mean: 1) that they charge more than double what they would charge a health insurance provider AND 2) that you will have to pay it out of the settlement you receive from the at-fault driver!
- If you give the hospital your health insurance information, they are required by law to use it. (This law came about because hospitals were increasingly choosing to put liens on legal settlements, rather than charging health insurance companies.)
If you think those hospital maneuvers are appalling, keep reading.
They will knowingly wait to bill you until you receive a settlement and then take more than double from your settlement.
What If You Don’t Have Health Insurance After a Car Accident?
So, what if you’ve been in a car or motorcycle accident that was caused by someone else, and you don’t have health insurance? I have good news: you may be able to apply for Medicaid and it could retroactively cover the injuries you received as a result of the car accident. Depending on your financial situation and the extent of your injuries, if you are in the hospital for a long-term stay, such as the ICU, or if you require long-term physical therapy or occupational therapy, you may qualify for Medicaid.
The hospital should send a social worker or case manager to help you apply. Why would they do this? Because it’s in their best interest! If you don’t have insurance, they will likely lose money on your care, so they want you to receive Medicaid, if you qualify.
However, if you provide them with the other driver’s insurance information when you’re admitted to the hospital, they will know that a legal case may proceed and they will try to get paid from your settlement. Basically, they will knowingly wait to bill you until you receive a settlement and then take more than double from your settlement than they would have received from Medicaid for your care.
Here’s a story for you:
We had a client who was the victim in a horrendous motorcycle accident and he didn’t have any health insurance. When he was admitted, he was unconscious, but his ex-wife and daughter provided the hospital with the at-fault driver’s insurance information. By doing this, they let the hospital know that there was a third party (the at-fault driver’s insurance company) that might pay for his medical costs.
Luckily, the victim hired us to help him and we walked him through the steps to apply for Medicaid. He qualified but the hospital still tried to receive payment from his final settlement. We had to “gently” remind the hospital that they had a duty to bill Medicaid and we saved our client over $700,000! His entire settlement was $1 million and the hospital wanted $700,000 of it! Because we had gotten the victim signed up on Medicaid, that $700,000 stayed in his pocket… and he desperately needs it for ongoing care.
Here are some excerpts from the letter we sent to the hospital:
Please be advised that on May 29, 2015, Governor Hickenlooper signed Senate Bill 15-265, which amends C.R.S. §38-27-101. The newly amended law states, in pertinent part, as follows:
“(1) Before a lien is created, every hospital … shall submit all reasonable and necessary charges for hospital care or other services for payment to the property and casualty insurer and the primary medical payer of benefits available to and identified by or on behalf of the injured person, in the same manner as used by the hospital for patients who are not injured as the result of the negligence or wrongful acts of another person. (Emphasis added)
(3) If a hospital is notified of a payer of benefits after it creates a lien, the hospital shall make good-faith attempts to submit reasonable and necessary charges for hospital care or other services to the identified payer in the same manner as used by the hospital for patients who are not injured as the result of the negligence or wrongful acts of another person.
(7) An injured person who is subject to a lien in violation of this section may bring an action in a district court to recover two times the amount of the lien attempted to be asserted.”
That last bullet point reminds the hospital that we can (and will) sue them if they do not follow the letter of the law. You can read the entire law here.
So, remember this (and share it with friends): if you are ever in a car accident and you are taken to the hospital, provide the hospital with your health insurance information. If you have any questions about this, don’t hesitate to call, 303-388-5305, or email me.
Colorado’s Make Whole Doctrine — It’s all about insurance. There is no magical pot of money after an accident.