Disclaimer: This article is for educational purposes only and does not constitute legal advice. Consult a qualified attorney for guidance on your specific situation.
Detailed Answer
When you settle a personal injury claim, medical providers often assert liens to recover unpaid charges. In Vermont, although there is no standalone medical lien statute, providers rely on contract rights and equity principles. You can still negotiate these liens aggressively to protect your net recovery.
1. Obtain and Audit Itemized Bills
Request a complete, itemized statement from each provider. Compare charges to usual and customary rates. Identify billing errors, duplications, and noncovered services. An audit strengthens your negotiating position.
2. Leverage Vermont Statutes for Indigent Care
If you received care through state or local indigent programs, Vermont law authorizes a lien for relief paid by the town or state. See 12 V.S.A. § 2801 (link). Use this lien cap as a benchmark when discussing reductions with private providers.
3. Present a Global Settlement Offer
Formulate a single offer that addresses all liens and your client’s net recovery. Providers often accept a lower lump-sum payment to avoid collection costs and delays.
4. Negotiate Directly with Providers
Call billing departments or lien resolution units. Explain the facts, your settlement budget, and any financial hardship. Ask for percentage-based discounts (typically 25–40%). Be polite but firm.
5. Use Medical Lien Resolution Services
Specialized firms handle lien negotiations. They know provider billing practices and can secure deeper discounts. Evaluate their fees against potential savings.
6. Allocate Settlement Proceeds Strategically
Once providers agree to reduced liens, ensure your settlement draft allocates funds correctly. Pay lien holders directly from escrow to avoid disputes and further fees.
Helpful Hints
- Start negotiations early, ideally before formal settlement discussions.
- Keep clear records of all correspondence and payment agreements.
- Use certified mail or email read receipts to confirm provider responses.
- Consult your fee agreement to understand how reduced liens affect attorney fees.
- Review provider charitable care or hardship policies for additional reductions.
- Document any Medicaid or Medicare involvement; federal liens follow different rules.