Should I use my health insurance when I have been injured in an auto accident or by the negligence of another?

One reason is that the at-fault party may have no or insufficient liability insurance coverage. While we wish that everyone carried insurance to cover injuries they cause to others, many people do not. This may be because they cannot afford it, cannot obtain it (due to previous acts or injuries to others) or simply are not responsible enough to do the right thing. Even when people do the right thing and obtain coverage, the policy they purchase can have exclusions, which deny coverage under certain facts or circumstances. Also, sometimes the amount of coverage that the at-fault party is able to afford cannot cover the medical expenses that come with substantial injuries. Using personal health insurance will help to protect the injured party in these circumstances. It may be the only source to pay the medical bills incurred if there is no liability insurance coverage. While the injured party will still have to pay co-pays, at least a portion of the bills will be paid by the personal health insurance provider. It is also possible that a portion of the bills will be written off due to the contract between the health care provider and the health insurance.

In the case of insufficient insurance, using health Insurance can help to maximize the benefits of what liability insurance coverage there is. Often times, the health insurance will have a subrogation interest in the liability insurance proceeds (meaning a right to be reimbursed what they have paid for injuries caused by the accident). However, many times an injured party can negotiate with their personal health insurance on how much they have to pay back or even request that their personal health insurance waive their subrogation interest. There are a number of factors that help determine whether the health insurance will take a reduction or how much of a reduction in their subrogation interest they will take. Factors such as the type of plan, the amount of liability insurance available and recovered, the amount of outstanding medical bills, the extent of injuries and damages, and other various factors depending on each individual case.

Another reason an injured party should use their personal health insurance is to maximize the compensation they receive even when there is substantial liability insurance coverage. As previously discussed, often when personal health insurance pays a medical bill, they only pay a portion of the bill and another portion will be written off due to contractual write-offs. South Carolina has the collateral source rule. The collateral source rule prohibits evidence that an injured party has received compensation from a source other than the at-fault party. Personal health insurance is a collateral source. Thus, an at-fault party cannot claim the benefit of payments by personal health insurance to avoid their responsibility to fully compensate the injured party for the injuries and damages they have caused. Therefore, the injured party can claim the full amount of their medical bills against an at-fault party even though a portion or all of the medical bills have been paid by their personal health insurance. Their personal health insurance may have a subrogation interest; however, as stated earlier, many times the amount the personal health insurance actually gets reimbursed can be negotiated. Also, the injured party will benefit from the contractual write-offs, as they will be claiming the full medical bill against the at-fault party and the amounts written off are not owed to the health insurance or the medical provider. Thus, the injured party lowers the amounts that ultimately have to be paid to medical providers and their personal health insurance, which allows a greater recovery for the injured party.

                One thing to watch for is health care providers who say that the personal health insurance coverage does not apply or will not pay. Personal health insurance most often will pay for accident related injuries. Also, many health care providers are contractually required to submit bills to the personal health insurance. There may be reasons for personal health insurance to deny coverage or medical care providers to delay submission of bills to personal health insurance. If these types of issues arise, it is best to contact an attorney to know and better understand your rights.

If you have questions regarding being injured or using your health insurance to pay accident related medical bills, please do not hesitate to call us at 803-356-5000 or toll free at 1-800-321-6125.