Disclaimer: This article is for informational purposes only and does not constitute legal advice.
Detailed Answer
In Virginia, certain medical entities can file liens against your personal injury settlement or judgment. These liens serve to secure payment for medical services provided due to the injury. You must address these liens before or as part of your settlement process. Key lien types include:
- Hospital Liens
Under the Virginia Hospital Lien Act (Va. Code § 8.01-66 to § 8.01-70), a hospital that treated you for injuries related to a tort claim may record a lien against any recovery you obtain. The hospital must file and serve notice within 60 days of your discharge. The lien attaches to the net recovery—after your attorney’s fees and litigation costs. Per Va. Code § 8.01-67.1, the hospital’s claim reduces proportionally by the ratio of your attorney’s fees and costs to the total recovery, ensuring you retain a fair share of your settlement. - Medicaid Liens
If Medicaid covered your injury-related care, the Commonwealth of Virginia may seek reimbursement under Va. Code § 32.1-325.2. You must notify the Department of Medical Assistance Services of your claim and settlement. Failure to do so may prompt Medicaid to file its own suit to secure repayment. - Health Insurer Subrogation
Private health insurers often include subrogation clauses in your policy. This means they have a contractual right to be reimbursed from any personal injury recovery for medical bills they paid. While not a statutory lien, insurers can file suit or assert equitable liens if you do not repay them from your settlement. - Other Medical Providers
Physical therapists, chiropractors, and private physicians generally lack an automatic statutory lien. They must file and win a lawsuit to obtain a judgment lien. In practice, many of these providers will negotiate reduced payoffs to resolve their claim efficiently during settlement.
Before finalizing your settlement, your attorney should obtain lien statements and payoff demands from each of these entities. Settlement funds typically disburse first to satisfy liens, then to your attorney for fees and costs, and finally to you.
Helpful Hints
- Request a complete lien report early in your case to identify all claimants.
- Obtain written payoff amounts and deadlines for each lien.
- Negotiate lien reductions; many hospitals and insurers accept discounted balances.
- Confirm Medicaid/Medicare reimbursement obligations before settlement.
- Keep copies of all lien waivers and hospital lien releases.
- Ensure your settlement agreement expressly states how liens will be paid.