Health Insurance in a Tort Claim

Video Transcript:

Cindy Speaker: If a person is injured in a car accident and needs medical treatment, what insurance do they use—health insurance or auto insurance?  That’s our topic today on this episode of StateLaw TV. My guest is North Carolina Attorney David Daggett of Daggett Shuler Law.  And David, it’s nice to have you today.

David Daggett: Hi, Cindy.  Thanks for having me on.

Cindy Speaker: Well, David, if someone gets into a car accident and they need medical treatment, should they pay for it with their health insurance or should they wait until they recover from the at-fault driver’s insurance company?

David Daggett: Cindy, that is a great question and it’s a question we get in our office very frequently.  The answer is, it is always in an injured person’s best interest to use their health insurance coverage first.  That doesn’t make any difference whether it’s private health care insurance, health care insurance through an employer or Medicaid or Medicare, use your health insurance first.  The reason is, is it helps bridge the gap in time until the auto insurance coverage can be sorted out in a claim result.  It keeps the bill collectors off your back.  And health insurance companies are used to processing claims.  Your medical providers are used to dealing with the health insurance.  It just makes it a whole lot easier for you.

Cindy Speaker: And if your health insurance company comes to understand that you did have a claim because of an automobile accident, are you going to have to pay back the insurance carrier when the claim is settled?

David Daggett: Cindy, that depends.  There are very strict provisions under the law as to whether health insurance is entitled to be repaid or not.  Repaying health insurance is called “subrogation”.  Health insurance carriers have to specifically qualify under federal statutes in order to be entitled to subrogation. So again, this is an area that is very complicated and very confusing.  An experienced injury lawyer can sort this out and easily weave through this mine field in order to handle it for an injured person.

Cindy Speaker: Okay.  Well, now, if your health insurance company knows that you were in an accident, does that have any effect on whether or not they are willing to pay your medical bills?

David Daggett: Typically no.  You have a contractual relationship with your health insurance company and under that agreement, they are required to process and pay your medical claims under the policy.  And again, that applies to private health insurance, health insurance through your employer or any sort of government program.

Cindy Speaker: You know, David, it really is complicated.  It seems that we talk about this insurance laws and it’s so complicated.  I want to ask you one more thing.  I’ve heard that that it is likely that your health insurance company probably becomes aware rather quickly when there is a claim because of an automobile accident.  How does that happen?  Is it just some kind of a system between hospitals and insurance companies, or that is public knowledge, or am I wrong on that?

David Daggett: Well, it would be in the medical records.  There’s coding on medical bills.  There are various ways that they can sort out whether the injuries came from an automobile accident or not.

Quite frankly, a lot of times, there are some gray area in there.  And sometimes, we really have to look at that gray area, particularly if we’ve determined that a health insurance provider is entitled to reimbursement.  For example, let’s say somebody is in an automobile accident, and while they’re in the hospital, they also have a heart attack.  The health insurance may or may not be entitled to repayment for those bills, for the treatment of the heart attack, and it takes somebody who is very competent to go through both the insurance language and the medical records to sort that out.

What the injured person needs is they need somebody on their side looking out for their best interest because the insurance company is not going to do that.

Cindy Speaker: Absolutely.  That certainly makes sense to me.  One other thing in my mind is when someone has an automobile accident; automobile insurance carriers are notorious for raising your rates.  Can that also occur with your health insurance?

David Daggett: That’s again a complicated answer.  The direct answer is no.  Health insurance companies don’t raise your rates for an accident.  However, it does go into your experience history and health insurance companies do base rates on occurrences in histories.  So it can’t directly make your health insurance go up.  It could indirectly make your health insurance go up.

Here’s an example that may help answer that question.  Is if you work for a company and you have health insurance through your company and somebody else in the company has to have major surgery that’s not accident-related, the health insurance rates could go up for your entire company the next time the insurance rates come around.  Now, that’s not a direct result but indirectly that can happen.  And maybe that’s getting a little too complicated to answer your basic question, no, they don’t raise your specific rates for a specific incident.  But it gets more complicated than that because in negotiating group policies, they do look at group claims histories.

Cindy Speaker: Right.  Well, it certainly is complicated.  David, if someone has specific questions, how can they reach your office?

David Daggett: This is a very complicated area—the law; and I recommend that anybody that’s dealing with these issues, at least consult with a confident attorney to try to get some answers and a better understanding of how it works.  Most attorneys will give guidance if necessary.  If it turns into a situation where representation is actually needed, then a good attorney will tell you, “Look, you’re really in over your head.  You need representation in this issue.”

For us, we have resources on our website at www.DaggetShulerLaw.com.  You can email, you can contact us by phone at 1-800-815-5500.  We enjoy helping people, enjoy sorting through these issues, and helping people out.  Particularly at what’s very a difficult time in your life.

Cindy Speaker: Right.  Well, David, thank you so much for being with us today.

David Daggett: Thanks for having me, Cindy.  We look forward to talking with you soon.

Cindy Speaker: Alright, good.  This is Cindy Speaker for StateLaw TV.