If my primary health insurance is Medicare or Medi-Cal, will I have to repay them after I settle my car accident claim?

If you were injured in a car accident and settle your claim with the negligent driver’s insurance company, Medicare and Medi-Cal have a right to be reimbursed for the medical payments they paid under California and federal laws. They have a lien, which is a right to repayment, on your settlement. However, an experienced car accident attorney can help you reduce the amount that you must repay.

Your Duty to Report a Car Accident Claim 

You have a duty to report your auto accident claim to Medicare or Medi-Cal. If you fail to do so, they'll most likely find out about it anyway and contact you. These government agencies use specialized computer programs to flag payments for injuries associated with accidents, so you should work with your legal counsel to report your claim promptly.

Medicare or Medi-Cal also requires periodic updates on the status of your claim, which you also have a duty to provide. Your attorney can keep them informed about the progress in your case.

How Much Can Medicare Require You to Repay?

Although Medicare has a right to be reimbursed for the medical bills it pays, special rules apply in California that may limit the repayment amount. This helps protect injured car accident victims and ensure they don't owe more in reimbursement to Medicare than they received in their car accident settlement.

For example, this could be an issue if a person suffers serious injuries that require long-term treatment, but the at-fault driver didn't have sufficient insurance coverage to fully compensate him. Here's how this rule works:

• In many cases, the most that Medicare will receive is 50 percent of the net proceeds of a settlement.
• The net proceeds are the portion of a settlement a car accident victim receives after his attorney fees and litigation costs are paid.

For example, assume Medicare paid $300,000 in medical bills, but the victim was only able to obtain $100,000 from the insurance carrier. If his attorney fees and costs were $33,000, the net proceeds would be $67,000. Medicare most likely would accept 50 percent of this, or $33,500. In this scenario, after all fees and liens are accounted for, the person would then keep $33,500 of his settlement.

You deserve to have a skilled car accident attorney partner with you to navigate the complexities of Medicare and Medi-Cal medical liens and negotiate a proper settlement and repayment plan.  Start an online chat to schedule a free consultation with me right away to learn more about how I can assist you. Also, take advantage of my free book offer, The 10 Secrets You Need to Know About Your Injury Case Before You Call an Attorney, in order to understand the process.