A lien is something that is granted to creditors when an individual owes them money. In Illinois, liens can be taken out by insurance companies, the VA, and state and federal agencies.
They can also be taken out by a doctor or hospital. Under the Health Care Services Act. (770 ILCS 23/1), if you receive treatment after an injury, your hospital, doctor, nurse, or other treating medical personnel can put a lien against your award in order to collect any outstanding bills. If the individual filed a personal injury lawsuit due to injuries from an accident, the hospital could collect the money owed to them from the award money.
There are other types of medical liens, too: subrogation liens for insurance companies, unions and other benefit plans, ERISA liens against benefits providers, and Medicare/Medicaid liens. In short, there are many ways for creditors to collect money, and many of them can affect your injury award.
The personal injury award
A personal injury award is the amount of compensation awarded to an individual who has accepted a settlement, or won a verdict, against the person/entity liable for the injuries. If the victim of the accident wins the case against the defendants, he or she can collect damages for:
- Cost of medical bills
- Loss of income (actual and potential)
- Loss of property
- Pain and suffering
- Loss of Normal Life
Some people settle outside of the courtroom because the defendants are willing to provide the victim with a fair and just amount of compensation. When the defendants are not willing to settle for a reasonable amount of money, the case usually goes to trial, and the defendants could end up paying out much more than they anticipated to the victim involved in the accidents.
The amount of the personal injury award will depend on numerous factors. These factors could include:
- The type of accident that occurred
- The severity of injuries sustained
- The amount of property damage/loss
- The lasting impact that the injuries may have on a victim, such as affecting the speech or mobility
- The fault of both parties
What happens when you have a medical lien?
When you have a lien against you, whatever award you win is reported to the lienholder. (In this case, it would be the doctor or hospital which placed the lien.) Under the act, up to 40% of your total award can be paid out for an award, and no hospital (or group of doctors) can collect more than 33% of your award. If the liens do make up more than 40% of your award, they’re automatically reduced.
For example, let’s say your medical care cost $1 million, and you only had $500,000 worth of coverage. The lien against you would be for $500,000. If you win $10 million in your claim, the hospital would be entitled to collect the entire lien, because it would equal about 5% of your total award.
If, however, you win $500,000, the hospital cannot collect its entire lien. Instead, it would be limited to collecting about $166,666, which is a third of your total award. Please note the health care provider may still attempt to collect its balance after the lien is paid. It can collect against an injured person directly. At Gainsberg Law, we make sure the health care provider does not seek to collect anything more from you after your case has settled, and the lien have been resolved.
What about my other creditors?
If you owe a lot of money to your credit card company, for example, you don’t have to worry about a lien. The creditor can file a lawsuit against you to collect funds, but that’s an entirely different process. Luckily, we’re prepared to handle that, too.
This is all pretty complicated, so the important thing to know is this: when you work with a Chicago personal injury attorney from Gainsberg Law, we negotiate with the lien holders to try to get your liens reduced overall.
If you were recently injured and are facing medical liens, Gainsberg Law would like to talk to you. We fight for compensation for the victims of all different types of accidents. Give us a call at 312-600-9585 or complete the contact form and schedule your free consultation with an experienced Chicago injury lawyer today.