When someone suffers a significant injury, they may face multiple financial stressors. Injuries from a car crash or a fall at someone’s property might leave them completely unable to work. That loss of income can be a very stressful situation, especially if someone is the primary wage earner for their family. They will likely also have major medical bills accumulating at the same time that they experience this drop in income.
People expect to receive insurance coverage in many scenarios that involve significant injuries. However, large insurance claims often take a long time to settle and may even lead to litigation. When insurance isn’t available or is insufficient, the person injured may need to file a lawsuit against the individual or business at fault for their injuries.
The claims process can take months or possibly longer than a year to complete. During that time, Medicare or Tricare could seek a lien while covering someone’s medical costs. What will that mean for the injured party?
Medicare and Tricare liens affect recovery
The Medicare program has clearly stated rules that allow the program to pursue liens or what it calls a recovery claim against someone’s future personal injury recovery. Federal law actually requires recovery efforts. Both the proceeds of lawsuits and payments made by insurance companies would need to go to repay Medicare benefits before the plaintiff will receive the balance of that compensation.
The same is true in scenarios where someone is a military servicemember or in a military family. Tricare can pursue a lien while paying for injury-related expenses. Simply put, liens from Tricare and Medicare help ensure that government insurance programs receive repayment from the compensation obtained from outside insurance companies or the parties responsible for someone’s injuries.
The need to pay off those liens will diminish what someone ultimately receives from their insurance claim or civil lawsuit. Therefore, those using Medicare or Tricare for their medical needs after an injury may need to factor those losses into the amount they seek during an insurance claim or lawsuit. As a result of these realities, having a realistic understanding of what may diminish a personal injury payout may benefit those recently harmed due to the actions or negligence of an individual or business.