CAR ACCIDENT AND HAVE HEALTH INSURANCE. WHAT MEDICAL BILLS DOES THE AT FAULT DRIVER HAVE TO PAY?

by Brett Cole Peterson on Mar. 27, 2021

Accident & Injury Car Accident 

Summary: Understanding how medical expenses are paid after a car accident

When people call to discuss an auto case, one of the big questions is what are they entitled to receive from the other driver’s insurance.

This post (limited to California law) looks at one of those elements:  medical bills.

Let’s assume you were rear-ended at a stoplight by a driver who was texting.  You receive treatment at the hospital.  You receive a $5,000.00 bill from the hospital (and the treating physician and radiologist who are independent contractors that bill separately) showing your health insurance paid most of the bill and you owe $100.00 copay.

Then, Geico Insurance  contacts you.  They represent the other driver and you’re not sure how much they should pay.  Is it the full $5,000 bill?  Is it your $100 out-of-pocket?

Actually, it’s neither.  Several years ago a case called Howell v. Hamilton Meats & Provisions, Inc. (2011) 52 Cal.4th541 changed the rule from you recovering  the full billed amount and reduced it to the amount you and your health insurance paid/owe:  “[A] plaintiff may recover as economic damages no more than the reasonable value of the medical services received and is not entitled to recover the reasonable value if his or her actual loss was less. California decisions have focused on ‘reasonable value’ in the context of limiting recovery to reasonable expenditures, not expanding recovery beyond the plaintiff’s actual loss or liability. To be recoverable, a medical expense must be both incurred and reasonable.”

So what’s the mean to you?  It means, you’ll need the Explanations of Benefits page sent out from your insurance or a detailed medical bill that shows the amount paid by you, your health insurance and the amount of any contractual discount.  Geico doesn’t have to pay the amount that was subject to a contractual discount.  Depending on your health insurance, you may have to reimburse (partially or wholly) your health insurance the amount Geico pays you that reflects the amount your health insurance paid for your services.  E.g. With that hypothetical $5,000 hospital bill, if your insurance paid $1,900 and you paid $100, and $3,000 was a contractual write-off, Geico should include $2,000.00 in its settlement offer to compensate for that medical treatment.  (Again, in some cases you may have to reimburse your health insurer some or all of the $1,900 it paid, but that’s the subject for a future blog entry.  And you are also entitled to loss of earnings and pain & suffering. Or call me if you want to discuss your unique situation)

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