Settlement Liens: Who Can File One Against Your Settlement?
Unfortunately, personal injury liens are growing in numbers. When a lawsuit is expected to last several months or even years, some individuals and companies have an interest in your settlement; therefore, they want to secure their piece. To secure their compensation, these persons and businesses may file settlement liens against your pending lawsuit settlement.
What are Settlement Liens?
Liens are third party requests made to the court to secure payment. With a personal injury lawsuit, the “property” sought is your compensation, and the lien holder is asserting their right to a portion of your payment. To place a lien, the third party must typically “perfect” the lien. This usually involves a process of filing or recording the lien in a matter that gives actual or apparent notice to the claimant and the world that the lien exists.
Entities and Individuals That May File a Lien
Individual medical providers may file a lien against your settlement. These are typically companies or individuals that provide services required for you to recover from your injury but will be compensated later through your settlement.
A few examples of entities and persons who may file a settlement lien against your compensation include:
- Hospitals: If you have received treatment at a hospital, they may have you sign a waiver or agreement for a consensual lien. This gives the hospital permission to place a lien against your settlement and collect payment for services after you receive a settlement instead of before the treatment.
- Physicians: When a doctor knows you have a pending personal injury case, and you do not have health insurance, they may request a consensual lien against your settlement.
- Health Insurance Company: If your medical bills are paid for by your health insurance company, they will want repayment for any services they covered. After all, your personal injury compensation amount is based on prior medical claims and costs. If you have Medicare, there is a statutory Medicare lien placed on your personal injury settlement by the federal government.
Once you receive your compensation, your attorney will then pay any outstanding liens, court fees, and distribute the remaining settlement to you. Often lien amounts can be negotiated so that you are not paying a clear majority of your compensation toward third parties that offered their services during your recovery.
Dealing with settlement liens is difficult. You need an attorney that can help you protect your settlement and negotiate with third parties that are attempting to place a claim against your much-needed compensation. Speak with a personal injury advocate from Udall Shumway, PLC to explore your options.
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding Settlement Liens, or any other personal injury, please feel free to contact Brian T. Allen at 480.461.5335, log on to udallshumway.com, or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full-service law firm. We assist Individuals, families, businesses, schools, and municipalities in Mesa and the Phoenix/East Valley.