Do Victims Of Medical Malpractice Owe Money Back To Insurance Carriers For Paying For Medical Bills?

Many times a victim of New York medical malpractice will ask, well, I have a lot of medical bills that were paid because of the medical malpractice—do I need to pay that back?

This is a fair question!  Many times medical malpractice is so catastrophic that victims suffer significant and irreparable damage.  Many victims have years of recovery, go through multiple surgeries, and even have permanent effects resulting in increased medical needs.  This can be very expensive.

Thankfully, most of these expenses are covered by insurance.  This could most likely be through Medicaid or Medicare, covered by CMS, or through a private insurance company.  Other times, in much rarer circumstances, the medical bills could be paid by workers’ compensation insurance or no-fault car insurance when the initial accident was at work or in a vehicle, then medical malpractice occurred in the treatment of the accident injuries.  But that is rare.

With the exception of almost all private insurance, Medicaid, Medicare, no-fault, and workers’ compensation insurance benefits paid MUST be paid back from any personal injury settlement, including medical malpractice.

However victims have a tool to help them!  The New York Court of Appeals, the highest court in New York, has released a case saying that there is a benefit to insurance carriers to have the victim litigate a case, pay the fees of the case, and take time away from his or her life to recover compensation.  This compensation that goes to the insurance company gets to the insurer with very little or minimal effort—because all the effort is on the victim and the victim’s attorney, which the victim is paying.

Therefore, the courts have allowed victims to use a formula to reduce the amount owed on insurance to ensure that victims do recover some compensation for their pain and suffering.  This formula is complicated and case specifically, but generally allows a victim to cut down an insurance bill by 30 to 40 percent, sometimes more and sometimes less.  This is a great tool to help victims to ensure they get the compensation they deserve!