What Are Hospital Liens?

A hospital may have a claim for reimbursement under the California Hospital Lien Act, which is codified in California Civil Code sections 3045.1 to 3045.6, for all “emergency and ongoing” services supplied to a person who was wounded in “an accident, or negligent or wrongful act.” In addition, county hospitals may have a claim under California Government Code section 23004.1. The lien on the county hospital will take precedence over all other liens and must be repaid first. The hospital lien is usually only applicable to third-party recovery, not to Uninsured or Underinsured Motorist insurance policies.

The hospital lien usually occurs when a hospital provides emergency care to an injured victim following an accident and the injured party does not have health insurance to pay for the treatment, or the injured party does have health insurance but it does not cover the entire hospital bill, or the hospital refuses to submit the bill to the injured party's health insurance because a third party is liable.

How to enforce Hospital Liens?  

The hospital must give written notice in an attempt to enforce its lien under California Civil Code section 3045.3, and the money a hospital can collect from a third-party settlement is limited. Prior to the distribution of funds to the injured individual, the Notice of Lien must be submitted by registered mail, return receipt requested, to the responsible third party and their insurance. The hospital has one year from the payment date to the injured party to initiate a lawsuit to enforce its lien.

How to get a reduction in Hospital Lien?

If a third party provides a settlement to the injured party without paying the lien, the third party is accountable to the hospital for the amount claimed in the hospital lien, according to California Civil Code, Section 3045.4. Third parties often will not release a settlement check until the hospital lien has been satisfied in writing. The hospital's lien may be lowered by removing the attorneys fees from the gross settlement amount and any other earlier liens, and then the hospital is limited to recovering up to 50% of the remaining net settlement amount, according to California Civil Code section 3045.4. It's vital to remember that liens against county hospitals must be paid first.

What is Balance Billing?

The hospital and individual emergency room physicians may attempt to bill the injured party for the difference between the hospital's “charge rate” and the amount paid by the injured party's health insurance as the “contract rate” in many cases. “Balance billing” is the term for this. Balance billing is forbidden when the hospital takes Medicare or Medicaid payments, according to Section 1395CC of Title 42 of the United States Code. Furthermore, California case law holds that if a hospital accepts payments from the injured party's private health insurance as complete payment for the hospital bills, the hospital cannot charge for the remaining balance. The California courts, on the other hand, have not barred hospitals and private health insurers from entering into a contract to protect their right to balance billing.

Conclusion

Call us to discuss your case with our experienced personal injury attorney. We can explain everything about hospital lien as we have successfully guided many clients in enforcing claims and getting reduction in Hospital Lien.