Featured Documents
price: $0.00
price: $0.00
price: $0.00
Imagine that you have a really unlucky day. While driving, you are in an accident, and it appears that you may be at fault. In your defense, you were distracted because you were on the way to the hospital for a series of medical treatments ordered by your doctor for injuries sustained when you were injured in a fall at a local store. Luckily, no one was injured seriously in the accident, but if you think that the events of that day were the worst part of the experience, you may be quite wrong. Welcome to the world of reimbursement and subrogation.
These two concepts are particularly thorny legal issues, and if you find yourself facing either one, or both, of them, it would be wise to consult an attorney. Even if the paperwork does not drive you over the edge, you could end up making a costly mistake without legal counsel. This is especially true in the case of subrogation.
Subrogation is a legal term for someone “who stands in the shoes of another.” In the situation described above, let us suppose that the insurance carrier for the people you hit pays for some of their medical bills, and for the damage to their car. The people you hit would have the right to sue you for the harm you caused them, but when they accept their insurer’s check, they almost certainly would assign their right to sue you to their insurance company. The insurer can sue you by right of subrogation, standing “in the shoes” of the injured parties.
The insurer would have the rights of its insured - no more and no less. So if the insurer waits too long to sue you, and the time for filing suit passes, the insurance company is as out of luck as the injured parties would be. You would be able to present all the defenses to the claims against you that you could have put forward if the people in the other car had sued you directly. All the evidence that might have been presented, including testimony by the injured parties, would be the same, whether the lawsuit was brought by the company or the injured persons themselves.
Depending on the determination of fault, your insurance carrier might defend you against the lawsuit, or settle the claim, or it might inform you that it has no obligation to do either because you were at fault, and you will be on your own.
Trying to put the unpleasantness of the accident behind you, you are pleased to find out that you have received a large settlement from the store where you fell. Your medical insurer paid for much of your treatment, but now you are being told by the insurance company that you are expected to reimburse it from your settlement for the money paid to your medical providers. Under most states’ laws, the insurance company would not be allowed to make such a claim, since it might eat up most of your settlement and leave you with little or no compensation.
However, if your medical bills were paid by a self-funded plan and not a traditional insurance plan, a federal law known as ERISA may allow your employer’s self-funded plan to require you to make reimbursement for the money paid for your treatment. Reimbursement under ERISA, how it works in relation to state law, and the specifics of what may be expected of you, are all issues that require the attention of an experienced attorney. Make sure that you do not sign anything or make any payments to anyone until a lawyer has the chance to read all the pertinent letters and agreements, and can counsel you on the steps you need to take next.
Photo courtesy of jasonEscapis via Flickr