Disclaimer: This article provides general information only and does not constitute legal advice. Consult a qualified attorney for advice specific to your situation.
Detailed Answer
Under Michigan’s Hospital Lien Act (MCL 333.20101 et seq.) and the Lien on Third-Party Recovery Act (MCL 600.2946), hospitals and certain medical providers may file liens against a personal injury settlement or judgment to secure payment for services rendered. These liens attach to any third-party recovery up to the reasonable value of the care provided. You can often negotiate these liens to reduce the billed amount and boost your net recovery.
Key steps for lien negotiation:
- Verify Lien Validity and Amount: Obtain an itemized statement. Confirm the provider properly filed the lien within the statutory deadline (MCL 333.20101, MCL 600.2946). Review all charges for consistency and coding errors.
- Benchmark Against Standard Reimbursement Rates: Compare billed charges to Medicare or Medicaid fee schedules. Many providers will accept a percentage of these rates (often 120–150% of Medicare).
- Request a Lump-Sum Discount: Offer an immediate lump-sum payment in exchange for writing off a portion of the lien. Providers may agree to discounts ranging from 25% to 50%.
- Negotiate Based on Financial Hardship: Demonstrate financial need or limited personal funds. This can motivate a provider to reduce its claim instead of risking costly collection efforts.
- Use a Lien Resolution Specialist: Professionals experienced in lien negotiation may secure deeper reductions due to their expertise and volume relationships with providers.
Keep detailed records of all correspondence. Once you agree on a reduced amount, obtain a clear lien release in writing before disbursing settlement funds.
Helpful Hints
- Review all lien documents for accuracy and completeness within 30 days of receipt.
- Research typical reimbursement rates using the Michigan Fee Schedule.
- Maintain open communication with providers; polite negotiation often yields better results.
- Include lien holders in settlement discussions early to prevent funding delays.
- Consult a personal injury attorney or settlement administrator if negotiations stall.