Yes, they can - it is called a subrogation lien right, and they can do it in a few different ways.
First, they can wait (as they usually do) until your California personal injury case settles. Depending on if you used an injury attorney will depend on what California state law arguments you can use to reduce their "lien interest."

Second, if they want, and your case has been filed in court, they hire their own attorney(s) and intervene on your injury case to make sure their lien interest is protected - but this cost money for them and it is not cost effective since Medical Pay lien amounts are usually under $10,000.00; so usually they wait for settlement or judgment and ask for reimbursement from you (you and your attorney will be sent letters reminding you all of their lien interest).

If you fail to pay them back, they can go after you personally - including your lawyer (potentially) because he or she will be said to have had "constructive notice" (should have known about it) of their lien interest. If the amount is low, they will either send you to collections or even California small claims court!  If your lawyer did not reimburse them you can go after your lawyer for professional legal malpractice (negligence).

Here is the law on it in California:

Progressive West Ins. Co. v Yolo County Superior Court, 135 Cal.App.4th 263 (2005) Case arising out of med pay reimbursement. Held that in personal injury cases, insurer cannot assert its subrogation claim directly against 3d party tortfeasor. Insurer may intervene in 3d party action or wait to seek reimbursement out of the recovery. If the insurer does not intervene in 3d party action, its right to recover is limited by the "make whole" rule to recover only after the insured has recouped his loss and some or all of his litigation expenses. Ct held that both reimbursement rights and subro rights fall under the rubric of subro and are therefore both subject to "make whole" doctrine. The insurance contract may waive the "make whole" rule but it must do so by clearly and specifically giving the insurer priority out of the proceeds regardless of whether insured was made whole. Insured here filed a 17200 action for the alleged unfair business practice of the insurer seeking full med pay reimbursement without regard to the "make whole" and common fund doctrine. The court affirmed the trial court's denial of insurer's demurrer to the 17200 action for unfair business practices.

Mark C. Blane is a San Diego Auto Accident Attorney, and the managing lawyer of the Law Offices of Mark C. Blane, a San Diego, California Personal Injury Law Firm devoted to representing families of injured persons of automobile accidents. If you or someone you love, has been injured or killed in San Diego County, or Southern California, due to the negligence of another, please order your FREE copy of Mr. Blane's book, The 10 Secrets You Need To Know About Your Injury Case, BEFORE You Call A Lawyer. It is full of helpful information, insights, and secrets that will help you protect your legal rights.  It normally sells for $16.95; however, it is free to all California residents, or those injured in a California accident.



Mark Blane
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