Repay Health Insurance after Car Accident Settlement

Q: Blue Cross paid my medical bills except for deductibles when I had an accident. Now, when I am getting ready to settle my accident case with the at-fault party, I am told Blue Cross wants the money they paid for my health care back from me. That doesn’t seem fair. Are they entitled to their money back?

A: That’s an excellent as well as a somewhat complicated question to answer. I am assuming that you have Blue Cross health coverage through your work. If so, the rights of Blue Cross to repayment are buried in the master contract that provides you medical coverage.

Additionally, a federal program called ERISA governs the interpretation of all health insurance provided through work.

If an attorney were representing you, the first thing he would do would be to obtain a full copy of the contract as well as a full copy of the ERISA plan to see if Blue Cross is entitled to their money back.

In many plans, the ERISA Plan administrator will demand the full amount the plan paid for health care.

Nonetheless, they may not be entitled to full repayment. Some plans give them no right to repayment, but they ask for it anyway.

Some plans claim the right to full reimbursement, and the contract reads that way as well, but state or federal law follows rules of equity, and they may only be entitled to some of the money back or even perhaps none.

One of the major advantages of having an attorney represent you in a serious injury case is that the attorney, if skilled, will generally be able to reduce by a substantial sum or even eliminate the requirement of repayment of employer-paid health payments.

In some cases, this task alone can save severely injured patients hundreds of thousands of dollars.
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