Tom McCutcheon – Attorney at Law
Q: I was an automobile accident. I went to the emergency room for treatment. I have Medicare and Blue Cross Blue Shield but I received a hospital lien. Does this lien go against my property?
Richard
Athens, AL
A: Hospitals are by law provided a lien if they provide treatment for injuries that result from an accident. There are specific requirements as to when and where the lien has to be filed.
A lien is a legal term for a claim on a specific property which could be land or personal property or even a claim on a cause of action owned by someone. It is a claim that has the right of first payment.
In this case, the lien only applies to settlement proceeds that are paid as a result of the accident other than for automobile repairs. If the at fault driver or their insurance company pays your medical bills without paying the hospital and getting released from the lien, they still owe the hospital.
Here is the bad news. Medicare has been designated as a “secondary payor”. That means that the hospital does not have to bill Medicare if they think they will get paid by an insurance company. Medicare has negotiated a substantial discount in medical costs and pays the hospital much less than an automobile insurance carrier like State Farm, Nationwide, Alfa, etc. So when a case is settled, the hospital that refused to bill Medicare has a big bill to be paid out of the settlement.
If you have Blue Cross Blue Shield (BCBS) as your primary insurance, the hospitals have a contract to bill BCBS. You are entitled to require that the hospital release the lien and bill BCBS. If you have Medicare, it is automatically your primary coverage but designated by law as secondary coverage. It becomes primary after 120 days. We don’t see a great deal of difference between the for-profit and charitable hospitals. Obviously, ECM/Region Care is a for-profit hospital that pays taxes on its earnings. Helen Keller Hospital and/or Huntsville Hospital are not for profit hospitals and pay no taxes on earnings.
We watch very closely to make sure that hospital liens are paid by either BCBS or Medicare. We can probably make a hospital bill BCBS because of the contractual relationship. We probably could not force a hospital to bill Medicare, although there is some case law to suggest that a hospital may not maintain a lien against a Medicare recipient. At any rate, lately, the hospitals in our area have, when asked in writing and after 120 days, generally been billing Medicare. Remember, we/you have to pay back Medicare under federal law and BCBS has a contract with its policyholders for repayment. The beautiful part about this is that we are repaying a much reduced amount and we get a discount for being the attorneys that made the other side repay Medicare or BCBS. That means we can really benefit the client by reducing the amount of money they have to repay and increasing the amount of money that they get to keep.
Buckle up and drive safely.
McCutcheon & Hamner, P.C.
2210 Helton Drive
Florence, Alabama 35630
Telephone: 256-764-0112
Facsimile: 256-764-1124
