The U.S. government recently released data detailing and comparing hospital charges. The clear fact revealed by the data — Charges for specific procedures can vary greatly between hospitals. This comes as no surprise to me. I see hospital bills on a regular basis in my personal injury practice.
When asked about this data on hospital charges, Huntsville Hospital’s CEO responded:
I’m not sure it’s really relevant to what Huntsville, Crestwood, or UAB hospitals actually get paid.
He’s right. The amount billed and the amount actually paid to the hospital can be very different. Blue Cross, Medicare, Medicaid, Tricare, and other plans, all pay differently. How does this issue impact personal injury claims? It creates many issues. Frankly, many lawyers who advertise for personal injury cases really don’t take the time to understand these issues. As a result, their clients suffer. Here are a few of these issues:
- The Same Injury Can Result In Very Different Medical Damages — Because of insurance issues, the amount accepted by a hospital for the same procedure to two different accident victims, can be very different. Under current Alabama law, the defendant in a personal injury case can introduce into evidence the lesser amount accepted by the hospital to satisfy a bill. Is this really fair to the injured person who paid huge health insurance premiums for many years?
- Some Hospitals Try To Collect Top Dollar From Accident Victims — If you have health insurance or coverage through a program like Medicare, the hospital should collect payment directly from your health plan. Yet, some hospitals ignore this coverage and file a lien directly against the accident victim for the full amount of the bill. In these cases, it is important that you have legal counsel that understands how to deal with health insurance and hospital liens. The difference to you can be huge.
- Different Health Plans/Programs Have Different Subrogation Rights — When a health program pays your bills and you later recover damages for the personal injury, that plan has certain rights to be paid back. A good understanding of subrogation is essential to helping your client with his personal injury claim. I have written about this topic previously. Too often, lawyers fail their client with these issues. Like the prior issue, the difference to you can be huge.
- People Without Insurance Have The Highest Charges — Because health plans and programs pay a reduced rate, people without health insurance effectively have the highest charges. So, the people who can least afford a big bill get the biggest. This makes it difficult to get the treatment needed for recovery. It also creates a cycle that can impact the injured victim for years. A prior study indicated that a majority of personal bankruptcies had a medical cause.
The recent study on hospital charges is interesting. The payment issues related to hospital charges are very important to my practice as a trial lawyer. This is an area where effective legal counsel can really help a client.