What is a lien in a personal injury case?

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If you have been injured due to another person’s negligence, you can file a personal injury claim to seek reimbursement for the economic and non-economic damages you’ve incurred from the accident and your injuries. Victims often are burdened with various physical, emotional, and financial losses that negatively impact their lives. That said, you may be entitled to significant compensation. However, the amount you can take home from your settlement may be affected if a lien is placed on your settlement. If you have been injured due to someone else’s negligence, contact an adept New York City Personal Injury Attorney who can help you fight for the rightful compensation you deserve. Please continue reading to learn who can legally put a lien on your personal injury settlement.

What is a lien on a personal injury settlement?

If you can fulfill the burden of proof in a personal injury case, you can recover monetary compensation for your losses, which will help you pay for your medical bills, lost wages, pain and suffering, and other injury-related expenses. However, as mentioned above, a third-party entity may put a lien on your personal injury settlement. A lien is a debt that must be paid out of your settlement proceeds to ensure that those that rendered their services to you receive payment.

Who can legally impose one on your settlement?

Only certain parties can legally place a lien on your personal injury settlement. The most common source of a lien is healthcare providers. When your health insurance does not cover the total cost of your injury-related expenses, you may have to sign a lien agreement to obtain necessary treatments. As part of this legally binding contract, you must pay your healthcare providers a portion of your settlement for reimbursement for their services. If you were injured or became ill while on the job, the insurer responsible for covering your lost wages could impose a lien on your settlement to be reimbursed for their expenses. However, they usually can only recover 2/3 of their costs in cases where the insurer paid more than $50,000.

In some cases, the government is statutorily required to be paid out of your settlement proceeds. This is when government-based benefit providers such as Medicaid or Medicare have covered your injury-related expenses. Your health insurance may also impose a lien if they cover your treatment costs. It is critical to note that if your health insurance is a self-funded ERISA plan, you must reimburse them under Federal Law out of your settlement.

If you have been injured in an accident due to someone else’s negligence, contact a dedicated New York City personal injury attorney from the Law Office of Brian J. Elbaum to discuss your legal options. Our firm is prepared to help you seek reasonable compensation for your damages.

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