Does Health Insurance Cover Car Accidents?

Posted on: August 22, 2020

You were hurt in a car accident. Luckily you have insurance.

The question is, “Does health insurance cover car accidents?”


This sounds like the typical attorney answer: it depends.

Your medical insurer is what is called a “secondary insurer” while your auto insurance is your “primary insurer”. This means that your health insurance will not begin paying for your treatment until your personal injury protection benefits have been exhausted.  How does this work? 

After an accident, you must use your PIP benefits for your injuries...not your health insurance!

Does Health Insurance Cover Car Accidents?

After a crash, the insurance that is used to pay for your medical treatment is called Personal Injury Protection (PIP). This is insurance that comes from your own auto insurer.

Assuming you have been treated within 14 days of the crash, PIP insurance will pay for up to $10,000 of medical treatment. When that $10,000 is exhausted, you or your accident attorney will receive written notification from the auto carrier that there are no more available PIP benefits. This is called an exhaustion letter.

This letter should be sent by your attorney to each of your medical providers. Then, your medical providers can stop billing your auto carrier for any further treatment. If the provider who is treating you accepts your health insurance, you can have that healthcare provider directly bill your health insurance.

Usually, your health insurer will require that your doctors and other medical professionals provide a copy of the PIP exhaustion letter. This is to confirm that this insurer should now be paying for treatment. 


Why Can’t I Use My Health Insurance?

Many clients wonder why they cannot just use health insurance and avoid using their own auto insurer to pay for treatment, especially when the other party is at fault for the crash. First, your health insurer may not pay for treatment because it is a secondary provider. (You cannot just choose to not use available PIP benefits.)

More importantly, nearly every health insurance company has a right of subrogation to allow them to be reimbursed for anything that they have paid out as a result of your accident.

In short, this means that you can still be held responsible for reimbursing your health insurance carrier for everything they paid to your doctors.

Your PIP provider, however, does not have rights of subrogation. You will never be held responsible for paying them back. So not only do you have to turn to your PIP benefits first, you are actually better off using it, since you will not have to pay back anything.


How Healthcare Does Subrogation Work?

When your healthcare provider pays for any treatment, it requires you to reimburse that provider for the payments out of any settlement or verdict.

These rights of subrogation are written in nearly every health insurance contract in the country. It is important that this right of subrogation be reviewed by experienced attorneys like those at Beers & Gordon because you do not want to reimburse any provider for money that is not owed.

After a crash, PIP benefits are better than health insurance.

These healthcare providers retain outside companies, called subrogation companies, whose sole purpose is to recover as much money as possible from the settlement to reimburse these providers.

Most of the people who work at these subrogation companies get paid more when they recover more money. What do you think happens when you incentivize employees to recover as much money as possible? You guessed it: they often resort to unscrupulous tactics. We have been advised of alleged charges that are billed at a higher than allowable amount in the hopes that these “mistakes” are missed by attorneys.


How We’re Different

Unfortunately, these mistakes are missed by many attorneys, but not at Beers & Gordon. The attorneys at Beers & Gordon and the staff are highly experienced in the resolution of these liens. We look for the errors by the lien companies and work closely with our clients to ensure that everything listed on the lien was related to their auto crash.

We often find that healthcare insurers will attribute every visit after a crash to the crash, even if the client is seeing the doctor for some longstanding and unrelated chronic condition.

Basically, the insurer wants to see if it can get more money than it may be owed.

Unlike the subrogation companies, attorneys do not make more money if they work to reduce your health insurance liens. But, do you know who gets more money? The most important person in the claims process: you, the victim of the crash.

While we do not make more money to reduce these liens, we work hard on it because it is the right thing to do for our clients. Every dollar less that we pay back to a healthcare company is a dollar more to our clients.

Beyond working diligently on these healthcare liens, the type of plans involved with the healthcare liens must also be scrutinized. Some plans require full reimbursement of all monies paid by the healthcare provider while others can be reduced by attorney fees, costs, and other arguments for reductions.

It is not just about asking for a reduction from the company, it is about knowing the company, knowing the plan language, and knowing what you may be able to do for your client.

You also have subrogation representatives who care and who will listen to the arguments on why a specific client should get a bigger reduction. As your attorneys, we will be familiar with you and your case and will be able to effectively explain why you deserve a bigger reduction of your healthcare lien than the typical person.

We never give up on this fight.

So, yes, it depends whether health insurance can be used. It is an important question and one that you should always cover with your attorney.