Who Pays My Medical Bills
While My Case Is Going On?

The short version: starting a malpractice case does not change anything about who pays for ongoing medical care today. Health insurance keeps paying. Medicare and Medicaid keep paying. Hospitals keep billing the same way they always have. What changes is what happens at the end — if money is recovered, parts of it may have to go back to the people and programs who paid along the way.

Health Insurance Keeps Paying

The most important thing to understand: a malpractice case is not a substitute for health insurance, and starting one does not put insurance on hold. Doctor visits, hospital stays, physical therapy, prescriptions, surgeries that are still needed — all of it should keep going through the patient’s normal coverage. Whether that is a private health plan, Medicare, Medicaid, TRICARE, or VA care, the insurer continues to pay for medically necessary treatment under the same rules that applied before the case started.

Patients sometimes hesitate to keep using their insurance because they think it will hurt the case. The opposite is true. Continuing to get treatment from the right specialists creates the medical record that proves the harm. Skipping care to "save it for the case" leaves a gap the defense lawyers will use to argue the injury was not as serious as the patient says.

What Subrogation Is, in Plain English

Most health plans have a clause called subrogation. It is buried in the plan booklet most people never read. The plain-English version: if the plan pays for medical care that someone else is legally responsible for, the plan has the right to be paid back out of any settlement or verdict in the case against that person.

For a malpractice patient, that means: if the health plan paid the hospital $40,000 for an extra surgery that the malpractice caused, and the case eventually settles, the plan has the right to be repaid that $40,000 out of the settlement before the patient sees the rest. The plan does not get the whole settlement — only the portion that covers the costs it actually paid.

Most subrogation clauses can be negotiated. Health plans regularly accept less than the full amount they paid, especially if the recovery is limited or the case is hard. Negotiating those clauses down is part of what the firm handles — the patient does not have to do it alone.

Medicare and Medicaid Liens

Medicare and Medicaid have stronger rights than private insurance. Federal law gives Medicare what is sometimes called a super-lien: if Medicare paid for medical care related to the malpractice, Medicare has to be repaid before any final settlement check is released. The legal source is 42 U.S.C. § 1395y(b)(2) — the Medicare Secondary Payer law.

The same general principle applies to Medicaid through state lien statutes. Florida’s Medicaid Third-Party Liability Act, Florida Statutes § 409.910, gives the Agency for Health Care Administration the right to recover Medicaid payments out of a settlement.

Both Medicare and Medicaid liens can usually be reduced. Medicare uses a fixed reduction formula that accounts for the patient’s attorney fees and costs. Medicaid will negotiate based on the same factors plus the strength and limits of the recovery. Like the subrogation work above, this is something the firm handles.

Hospital Liens

Some Florida counties have local hospital lien laws that let a hospital file a lien against a future personal injury recovery for the unpaid balance of a bill. These are county-level statutes, not statewide, and they are most common in Miami-Dade, Broward, and Palm Beach counties.

Hospital liens look scary on paper but are often the most aggressively negotiable item in the file. A hospital’s "billed charges" are almost always far higher than what the hospital would actually accept from any insurance company. When the firm negotiates the lien, the goal is to get the hospital paid the same way it would have been paid by an insurer — not at the inflated billed-charges number.

Letters of Protection

Sometimes a patient needs treatment from a doctor or therapist who does not take insurance, or whose specialty is not fully covered. In those situations the firm can issue a Letter of Protection (LOP). An LOP is a written promise from the firm to the provider: treat the patient now; if there is a recovery in the case, the bill will be paid out of the settlement.

Letters of Protection are useful but should be used carefully. Like a hospital lien, the LOP balance has to come out of the eventual recovery, and the bills can grow large over the course of a case. The firm uses LOPs when they are the only way to get the patient the right care, and only for providers who will negotiate the balance reasonably at the end.

What Patients Do Not Pay

A medical malpractice case is taken on a contingency-fee basis. That means:

• No retainer. No money up front to start the case.
• No hourly bills. The lawyer’s fee comes out of any recovery, not out of the patient’s pocket.
• Costs are advanced. Filing fees, medical expert fees, deposition costs, court reporter fees — the firm advances these and is reimbursed only if there is a recovery.
• No fees if no recovery. If the case does not result in money, the patient owes the firm nothing.

Florida Bar rules govern the maximum percentage a lawyer can charge in medical malpractice cases. The fee structure is laid out in the engagement agreement before any case is signed up, and the patient gets a clear, itemized accounting at the end.

What to Keep on Hand

Patients can make life much easier on themselves — and on the case — by keeping a few things organized as treatment continues:

• Every Explanation of Benefits (EOB) from health insurance. These show what the plan paid and what the patient owes.
• Every hospital and provider bill — even ones that have already been paid by insurance. The bills are evidence of the cost of care.
• Every prescription receipt for medication related to the injury.
• A simple list of every appointment, with the date, the provider, and the reason. A spiral notebook works fine. This becomes a powerful timeline at trial.
• Mileage to and from medical appointments. Mileage to medical care is a recoverable cost in Florida personal injury cases.

Patients do not have to pull all of this together perfectly. The firm can subpoena the billing records at the right time. But anything the family already has in a folder — or a shoebox — saves weeks of work and improves the eventual recovery.

The Big Picture at the End

At the end of a successful case, money does not arrive as one undivided check. The firm prepares a written closing statement showing exactly where the recovery goes:

• The patient’s share, free and clear.
• The lawyer’s contingency fee, calculated under the rate set in the engagement agreement.
• Reimbursement of case costs the firm advanced.
• Payment of any negotiated subrogation, Medicare, Medicaid, hospital, or LOP balances.

That itemized accounting is one of the parts of the process the firm is most careful with. Every dollar that comes in and every dollar that goes out is on one page, in writing, before the patient signs anything.

Sources

• 42 U.S.C. § 1395y(b)(2) — Medicare Secondary Payer (Medicare super-lien). uscode.house.gov
• Centers for Medicare & Medicaid Services — Medicare Secondary Payer overview. cms.gov
• Florida Statutes § 409.910 — Florida Medicaid Third-Party Liability Act. leg.state.fl.us
• The Florida Bar — Rule 4-1.5 (lawyer fees in contingency cases, including medical malpractice maximums). floridabar.org
• Florida Bar — Consumer Pamphlet: Medical Malpractice. floridabar.org