Understanding Balance Billing Liens
What are billing liens?
Billing liens are a way for medical providers to recover money for services rendered, because a third party has caused injuries. In the past, medical providers received payments from insurance carriers through the contracts they have with each other, and then simply wrote off the remaining balance (for the cost of services rendered).
However, this new form of recovery allows medical providers (because a third party was at fault for the injuries) to try and recover the full amount for the medical treatment provided and the associated expenses.
I still don’t understand balance billing liens. Can I have an example of a billing lien?
Absolutely. Billing liens can be difficult to understand, so the following example may help you to further understand what they are and how they work:
Let’s first assume that you go skiing and break your leg. You have health insurance, so you go to the hospital and receive treatment. Your total hospital bill is, let’s say, $7,000. But thankfully, because of your health care coverage, you pay your applicable co-pays, and your health insurance company pays, hypothetically, $3,000 versus the whole price. Your health insurance company is able to do this because of their agreement with the medical provider. After all is said and done, (and you, sadly, are out for the rest of the skiing season) the $3,000 that was paid to the health care provider is all that they will receive, and the remainder of the debt is written off. Again, this is because of the agreement between the insurance company and the health care provider.
But now let’s assume, instead, that you are in a car accident and you break your leg. You have the same health insurance policy, and you go to the same provider for medical care. Your bill for mending the broken leg is still $7,000, and your health insurance company still pays $3,000; because of the contract between the two entities.
You pay your co-pay and think you are on your merry way; but not so fast. Because a third party caused your injuries, it is now possible that the health care provider can still demand the remaining $4,000 from you (via any settlement you collect).
Why would a health care provider place a balance billing lien on me?
As we covered above, it is possible that you may be held liable for the remaining balance of the full cost of your medical care. When you have health insurance, and are injured in an accident (caused by a third party), the money paid to the health care provider by your insurance company is often much less than the full cost of care, as illustrated above.
Depending on your injuries, there are cases when health care providers understand that you will probably be receiving a settlement from the at-fault party. If the provider feels this may happen, they can place a lien on your case. This balance billing lien is a demand for payment of the difference between the full cost of care, and what was paid by your health insurance. In this hypothetical example, the amount was $4,000.
What can I do if a balance billing lien is placed on my case?
If a balance billing lien is placed upon your accident injury case, it is best to call an experienced lawyer immediately. It is extremely difficult to navigate the complexities of health insurance, car insurance and medical care provider laws; not to mention all while trying to recover a settlement from the at-fault party.
In addition, balance billing has been classified as in illegal practice in some courts.
If this happens to you, it is imperative to have an experienced and knowledgeable lawyer on your side to help ensure you receive and keep the settlement you deserve.