Disclaimer: This blog post is for informational purposes only and does not constitute legal advice.
Step 1: Conduct a Comprehensive Investigation
Begin by gathering all medical records, billing statements and insurance Explanation of Benefits (EOBs). Contact the county clerk’s office where the hospital is located to search for any recorded hospital liens. Identify claims from private insurers, Medicare or Medicaid that may seek reimbursement.
Step 2: Review New Mexico Hospital Lien Statutes and Deadlines
New Mexico law grants hospitals a lien on a patient’s claim for charges related to treatment of a personal injury. Under NMSA 1978, § 48-1-14, the lien arises at the time of service. The hospital must file a lien in the district court of the county where treatment occurred. Per § 48-1-15, the lien must be recorded within six months after the patient’s last date of treatment. Missed deadlines can invalidate the lien.
Step 3: Obtain and Analyze Lien Statements
Request a detailed lien statement from each hospital or medical provider. Confirm the total charges, outstanding balance and dates of service. For insurer subrogation or reimbursement claims, ask for the plan’s final demand letter and supporting documentation. Verify that each claim follows contractual and statutory notice requirements.
Step 4: Negotiate or Challenge Lien Amounts
Medical bills and insurer reimbursements often exceed reasonable market value. Negotiate reductions by leveraging common fee schedules or Medicare rates. If a hospital or insurer fails to comply with statute or plan terms, consider filing a motion to discharge or reduce the lien under NMSA 1978, § 48-1-18.
Step 5: Secure Lien Waivers or Releases
After reaching an agreement, request a signed lien waiver or satisfaction document from each hospital and insurer. Ensure waivers explicitly release the lien against the settlement proceeds. File the recorded satisfaction with the district court clerk when necessary.
Step 6: Allocate and Disburse Settlement Funds
Prepare a settlement ledger showing gross recovery, attorney fees, costs and net proceeds. Deduct the resolved lien amounts only after securing waivers. Disburse funds to your client and other payees in strict accordance with the final settlement order to avoid personal liability.
Relevant New Mexico Statutes
- NMSA 1978, § 48-1-14 – Hospital lien for patient’s claim
- NMSA 1978, § 48-1-15 – Filing requirements and deadlines
- NMSA 1978, § 48-1-18 – Enforcement and discharge of liens
Helpful Hints
- Start lien clearance early—deadlines run from the last date of treatment.
- Obtain itemized billing and insurer EOBs before finalizing settlement terms.
- Compare billed amounts to Medicare or Medicaid fee schedules for leverage.
- Document every negotiation and exchange with hospitals and insurers.
- Secure written lien waivers before disbursing any settlement funds.
- Consult a New Mexico attorney for complex liens or subrogation disputes.