questions & answers

Question: I was involved in an accident last year where the at-fault driver was uninsured. After receiving care my health insurance was billed and no liens were put on my auto insurance. I have since settled with auto insurance, but this week I received a collection notice from an attorney saying I owe the provider an amount above the agreed upon rate from my health insurance. When talking to the provider they said AZ law allows them to collect the remaining balance from me with personal injury. Can they hold me liable for the balance above the rate my health insurance has after they have billed them?

Answer: From the information provided in your question, I am assuming that the settlement you described is one with your own insurer under the uninsured motorist coverage section of your auto policy.  Health insurance companies and health care providers lobbied the Arizona legislature to allow them to enforce liens on auto insurance liability settlements.  They argued that the patient gets a double recovery when the doctor or hospital accepts a reduced amount for their bill from the health insurance company.  Health insurance carriers negotiate reduced fee agreements with health care providers.  The doctors and hospitals wanted to be able to charge the accident victim the full amount of their "reasonable and customary charge" for the services rendered.  The fact that the patient pays a substantial premium for that health insurance didn't enter into it.  The Arizona legislature enacted a statute:  Arizona Revised Statutes, Section 33-931.  This statute gives health care providers the right to record a lien against a patient's personal injury recovery for the difference between the amount paid by the health insurance company and the provider's "reasonable and customary charge."  However, there is an exception for uninsured and underinsured motorist coverage.  The statute states:  A lien pursuant to this section extends to all claims of liability or indemnity, except health insurance and underinsured and uninsured motorist coverage as defined in section 20-259.01 . . ."If your settlement was with your uninsured motorist coverage, there is no valid lien.