Will the Responsible Driver’s Insurance Pay My Medical Bills?

Many doctors post notices in their waiting rooms that say something like: “payment is expected at the time services are rendered.” For someone compelled to seek medical care because of a car accident or other traumatic injury caused by someone else, the unexpected need to meet that expense can be a significant problem. Even if the doctor does see the patient without upfront payment, bills for medical treatment after a car accident injury add up quickly—and can add worry and stress to the list of conditions that an injured person must manage.

You might think that the at-fault driver’s insurance would step in. But car insurance liability carriers will not pay for your medical care as you go. Instead, they will expect you to pay for the care, then submit all the bills at once. If they make an offer to settle the case, it may be far too low to cover the amount of the bills. The at-fault party in a personal injury case can be held responsible for the cost of reasonable and necessary medical care when a settlement is reached or the injured person prevails in a lawsuit. But what happens while injuries most need treatment that the injured person can’t afford?

An injured person’s own auto insurance is the first possible payment source. Under Oregon law, every “motor vehicle liability policy issued for delivery in this state that covers any private passenger motor vehicle shall provide personal injury protection benefits to the person insured thereunder . . . .” Policies must also provide these personal injury protection, or “PIP”, benefits to “members of that person’s family residing in the same household, children not related to the insured by blood, marriage or adoption who are residing in the same household as the insured and being reared as the insured’s own, passengers occupying the insured motor vehicle and pedestrians struck by the insured motor vehicle.” ORS 742.520(1).

This means that at least a minimum level of PIP benefits is included in every Oregon automobile insurance policy. PIP covers reasonable and necessary expenses of medical, hospital, dental, surgical, ambulance, and prosthetic services incurred within one year after the date of the insured person’s injury up to $15,000. If the injured person is employer or otherwise earning income and disability continues for at least 14 days, then PIP will also pay 70 percent of the loss of income from work during the period of the injured person’s disability until the date the person is able to return to the person’s usual occupation up to a maximum payment of $3,000 per month. ORS 742.524(1)(a)-(b).

If the injured person has no auto insurance, then the next place to turn is his or her personal health insurance policy. While health insurance will likely be entitled to reimbursement for benefits paid once a settlement is made or damages allowed by a jury, it can be an important source of needed benefits. Unfortunately, many health insurance plans refuse to pay for medical care incurred as a result of injuries from an automobile collision or other trauma caused by a third party. Health insurers may expect you to look to the responsible party’s insurance carrier to pay the bills.

So what does an injured person do when either no one is available to pay or agrees to pay for medical care? Must he or she somehow do without needed medical treatment until someone else can be held responsible for the injury? An attorney can usually help in this situation by using a written letter of protection to medical providers. A Letter of Protection is a letter sent by an injured person’s attorney to a medical provider agreeing to pay the medical expenses owed by the patient out of any future recovery whether by settlement or after trial. It is an agreement that allows the injured person to receive medical care with the medical provider agreeing to wait until the conclusion of the case to receive payment. If the lawyer settles the case or otherwise recovers money, then the attorney agrees to make sure that the medical provider’s bill is paid from those funds. If there is no recovery (i.e. the injured person goes to trial and loses the case), then the injured person is still responsible for the bill, and the medical provider retains the right to collect as with any other debt.

A letter of protection doesn’t eliminate the cost of medical care, but it can extend the time for payment—and in a traumatic injury case, time usually means healing. If you have questions about letters of protection or paying for medical care after a car accident or other injury you should consult with a competent personal injury lawyer.