Disclaimer: This article is for educational purposes and does not constitute legal advice.
Understanding Tennessee Hospital and Insurer Liens
After a personal injury settlement, hospitals and health insurers often assert liens to recoup medical expenses they’ve covered. Tennessee law gives health-care providers statutory lien rights and allows insurers to pursue subrogation. Identifying and resolving these liens protects clients and ensures compliant disbursement of net settlement funds.
Step 1: Identify Potential Liens
• Request a comprehensive lien letter from every medical provider involved. Providers include hospitals, emergency transport services and rehabilitation centers.
• Ask insurers for subrogation statements detailing benefits paid.
• Check federal programs (Medicare/Medicaid) for potential repayment claims under the Medicare Secondary Payer Act.
Step 2: Verify Statutory Lien Rights
• Review Tennessee health-care provider liens under Tenn. Code Ann. § 29-32-101 et seq.. Providers must file a lien within 90 days of last treatment or lose lien rights.
• Confirm insurer subrogation rights under Tenn. Code Ann. § 56-7-120 (contractual reimbursement clauses).
Step 3: Audit and Negotiate Lien Amounts
• Compare billed charges versus usual-and-customary rates.
• Determine payments already made by health plans.
• Negotiate reductions based on billing errors, charity care or statutory caps.
• Secure written lien reduction agreements to document the negotiated balance.
Step 4: Secure Releases and Payoffs
• Obtain a lien release or payoff statement from each provider and insurer.
• Ensure the release references the claim number and settlement date.
• Withhold funds in escrow until all releases are on file.
Step 5: Comply with Federal Law
• For Medicare or Medicaid beneficiaries, report settlements to the Centers for Medicare & Medicaid Services (CMS).
• Follow CMS guidelines for conditional payments and demand letters to avoid Medicare liens later.
Helpful Hints
- Track deadlines closely: missing a 90-day filing window voids a hospital lien.
- Document every communication: save emails, letters and any settlement drafts.
- Hold settlement funds in trust until all lien releases are received.
- Consult with a qualified attorney experienced in Tennessee lien resolution.
- Review client medical benefits statements for hidden insurer subrogation rights.