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Detailed Answer: Satisfying Medical Liens in a Rhode Island Personal Injury Recovery
After you negotiate a settlement or obtain a judgment in a Rhode Island personal injury case, you must satisfy medical liens before distributing funds. Medical liens secure payment for treatment providers who cared for you. Rhode Island law grants hospitals and certain providers a statutory lien against your recovery.
1. Identify All Potential Lienholders
Start by obtaining full medical records and billing statements. Identify which providers have lien rights, including:
- Hospitals and nursing homes under R.I. Gen. Laws § 34-33-1 (statute);
- Rehabilitation centers;
- Doctors, therapists, and other health professionals (contractual liens);
- Government payors (Medicare, Medicaid) and private insurers (subrogation).
2. Confirm Statutory Lien Requirements
Under R.I. Gen. Laws § 34-33-2 (statute), hospitals must file a lien notice within 30 days after the last date of treatment. Providers file with the city or town clerk where treatment occurred. They must also mail a copy to your attorney or you. Missing these deadlines voids the lien (§ 34-33-4).
3. Request Lien Statements and Demand Payoff Figures
Ask each lienholder for a detailed payoff statement. Confirm:
- Total billed charges, adjustments, and amounts billed to your insurer;
- Whether Medicare or Medicaid reduction rules apply;
- Any outstanding balances or interest;
- Deadline to pay the lien.
4. Negotiate Lien Reductions
Rhode Island courts encourage lienholder cooperation. You can often negotiate reduced lien amounts based on the provider’s billed vs. collectible charges. Provide settlement figures and invite the provider to adjust its claim. Document all communications in writing.
5. Allocate Settlement Funds in Trust
Your attorney must hold settlement funds in trust until all liens, fees, and costs are resolved. Rhode Island Bar Rule 1.15 requires attorneys to safeguard client funds and disburse them properly.
6. Make Lien Payments Before Disbursement
Prior to disbursing any funds to you, your attorney pays each lienholder. This process ensures the statutory and contractual obligations are met. After lien payments, the attorney deducts fees and case costs.
7. Obtain Lien Releases
Once paid, secure a lien release or satisfaction instrument from each provider. Keep these documents in your file. They protect you from future claims on the same medical bills.
8. Disburse Remaining Funds to You
After all liens, fees, and costs are paid, your attorney issues the net recovery to you. Thorough recordkeeping ensures transparency and compliance with Rhode Island trust accounting rules.
Helpful Hints
- Start lien resolution early: Allow 60–90 days before anticipated closing.
- Maintain a master lien chart: Track liens, deadlines, payoffs, and releases.
- Communicate in writing: Confirm any negotiated payoffs by email or letter.
- Verify Medicare/Medicaid obligations: Federal rules may require specific procedures.
- Keep funds in escrow: Never disburse until all liens are satisfied.