Disclaimer: This article is for informational purposes only and does not constitute legal advice.
Detailed Answer
When you recover from injuries in Virginia, your treating physicians can assert a lien on your personal injury recovery under the Virginia Hospital Lien Act (Va. Code § 8.01-66.1 et seq.). This lien secures payment of your medical bills directly from any settlement or judgment.
However, the Act does not fix the amount owed. Billed charges often exceed what providers will actually collect. You or your attorney can negotiate these liens downward to increase your net recovery. Here’s how it works under Virginia law:
- Verify lien perfection. The provider must file a written lien within 30 days before the date of settlement or judgment (Va. Code § 8.01-66.5). If they miss this deadline, the lien is void.
- Obtain an itemized statement. Request a detailed billing ledger. Confirm dates of service, codes, and total charges.
- Analyze usual and customary rates. Compare the billed amount to regional fee schedules, Medicare reimbursement rates or Medicaid maximum fees. Providers often accept a percentage of billed charges—commonly 40–60%—rather than full price.
- Engage in written negotiation. Draft a letter to the provider setting out your offer, supported by fee schedules or expert analysis. Request confirmation that they will reduce or release the lien upon receipt of a lower payment.
- Document any agreement. Ensure the provider signs a lien reduction or satisfaction agreement before you disburse settlement funds.
- Prioritize distributions. Under Va. Code § 8.01-66.7, valid liens are paid before your attorney’s fees and costs. By lowering the lien amount, you increase the balance available for legal fees and your own recovery.
While the Hospital Lien Act lays out filing requirements and lien priority, it does not prohibit negotiation. Many medical providers prefer a prompt, reduced payment over protracted litigation over lien enforceability. An experienced personal injury attorney can lead these negotiations and maximize your recovery.
Helpful Hints
- Gather all medical records and billing statements early.
- Compare provider charges to Medicare or state Medicaid rates.
- Keep all correspondence in writing to create a clear negotiation record.
- Obtain a signed lien waiver or satisfaction letter before disbursing funds.
- Consider a health care lien reduction expert if negotiations stall.
- Review your settlement agreement carefully to ensure proper lien payment.