Short answer: Yes — some medical providers and government health programs can claim a portion of your Texas settlement. Which claims get deducted depends on who treated you, whether the provider has a statutory lien or an assignment, and whether federal programs (like Medicare or Medicaid) or an employer plan have a right to reimbursement. This article explains the common types of liens and how they are handled in Texas so you can know what to expect and what steps to take before you accept any settlement.

Detailed answer: who can stake a claim against your settlement in Texas?

When you settle a personal injury claim, the payout often represents compensation for several things: medical bills, lost wages, pain and suffering, and other losses. Third parties who paid your medical bills sometimes try to recoup what they paid from your settlement. The most common sources of claims are:

• Hospitals and health systems with statutory or common-law lien rights — In many states hospitals have statutorily authorized lien rights for emergency and inpatient care; in Texas, hospitals, certain trauma centers, and sometimes other medical providers may assert claims against recoveries for treatment of injuries. These claims often appear as a recorded lien or a written demand against the proceeds of the tort recovery.
• Private medical providers (including chiropractors) — Chiropractors, urgent care clinics, and private doctors typically do not have an automatic statutory lien like some hospitals do. However, they can try to protect payment rights by (a) obtaining an assignment of proceeds or a signed lien/assignment agreement before or after treatment, (b) filing an enforcement action after settlement, or (c) negotiating a reduction. Whether a chiropractor’s bill will be deducted depends on whether they have a valid assignment or file a legal claim before the settlement is distributed.
• Health insurance subrogation claims — If an insurer (private group plan) paid your medical bills, it may seek reimbursement from your recovery under subrogation or contractual reimbursement rules. Employer-sponsored (ERISA) plans often have strong subrogation or reimbursement rights and may demand repayment from your settlement.
• Medicare and Medicaid liens and federal conditional payment claims — If Medicare paid for treatment related to your injury, federal law requires Medicare to be reimbursed from any settlement that pays for those medical items or services. Medicare recovery requests (so-called conditional payments) can reduce what you receive from a settlement. Medicaid (state-federal program) and the Texas Medicaid program (and other state programs) also have mandatory repayment rights in many circumstances.

Which of these will actually reduce your settlement depends on legal priority, any signed agreements, and whether the claim is enforced before the settlement distribution.

How liens and subrogation typically get paid from a settlement

Process and priorities commonly look like this:

1. Demand and verification: Before or after you reach a settlement, providers or insurers send demand letters and assert liens or subrogation claims. Your attorney should request lien statements and payoff amounts in writing.
2. Trust account holdback: Your attorney often holds settlement funds in a trust account while clearing liens and making required payments. Do not accept or cash a settlement check without resolving claimed liens — doing so can expose you to lawsuits.
3. Negotiate and reduce: Many liens get reduced through negotiation. Private providers and even insurers often accept a percentage of billed charges, especially if you only recovered limited funds after attorney fees and other costs.
4. Statutory/federal paybacks: Federal programs like Medicare typically must be repaid for covered services; those programs have administrative processes to request conditional payment reimbursement and to negotiate final repayment amounts. You can check Medicare conditional payment amounts and request a final demand through the Medicare Secondary Payer recovery portal.
5. Final distribution: After approved payoffs, your attorney distributes the remainder to you, minus attorney fees and case expenses. If a lien remains unresolved, courts can sometimes hold disputed funds in escrow until someone proves entitlement.

Specifics for chiropractors in Texas

Chiropractors are frequently involved in soft-tissue injury claims (e.g., neck and back care after car wrecks). Key points:

• Unless a chiropractor has a signed assignment, written lien agreement, or obtains a judgment, they may lack a statutory lien that automatically attaches to settlement proceeds in the same way a hospital lien might.
• Chiropractors can file a civil suit to collect unpaid bills or record an affidavit asserting a lien if Texas law and the facts support it. Timing matters: a recorded lien or a pending lawsuit can affect whether funds get held back at closing.
• Negotiation usually works. Many chiropractors expect some discount when the claimant recovers limited net proceeds after attorney fees and costs.

Federal programs (Medicare/Medicaid): what to expect

If Medicare paid any of your medical treatment, federal law generally requires Medicare to be repaid from any settlement that covers medical treatment related to your injury. This is governed by the Medicare Secondary Payer rules, which allow Medicare to recover conditional payments it made. The key federal authority on Medicare recovery is at 42 U.S.C. § 1395y(b). You can learn more about Medicare’s recovery processes and conditional payment requests through official federal resources (see 42 U.S.C. § 1395y(b): govinfo.gov).

Medicaid (which in Texas is administered through the Texas Health and Human Services Commission) also has recovery rights and can assert liens or claims for reimbursement. These federal and state program paybacks take precedence and can significantly reduce your recovery if you do not address them before settlement.

What you should do before you accept or sign a settlement in Texas

1. Tell your lawyer about all payors: Provide names of any medical providers, health insurers, Medicare/Medicaid, auto or PIP insurers, and any other party who paid your bills.
2. Get written lien/payoff statements: Ask each provider and insurer for a written payoff statement showing exact amounts owed and any reductions they will accept.
3. Don’t sign releases that leave liens unresolved: A full release that discharges the defendant but leaves lien claimants unpaid can leave you personally responsible. Insist that payoffs be arranged or funds be escrowed to resolve legitimate claims before final distribution.
4. Hold funds in trust until liens clear: Your attorney should not disburse settlement proceeds until valid liens are identified and paid or until disputed amounts are placed in escrow or with the court.
5. Negotiate reductions: Many providers accept a significantly lower payment than the billed amount when you show there are limited net proceeds after fees and costs. Your attorney will typically negotiate these.
6. Resolve Medicare conditional payments: Before settlement, request a Medicare conditional payment report and resolve those amounts through the Medicare recovery process. Failing to do so can cause Medicare to seek reimbursement from you later.

When a lien is invalid or disputed

Not every demand is enforceable. Common defenses and issues include:

• The provider never obtained a valid assignment or written lien agreement.
• The provider’s bills relate to unrelated treatment that your settlement does not compensate.
• The claimant already paid the provider through insurance and the provider has no remaining right of recovery.
• A statutory lien has not been properly recorded or enforced.

If you dispute a claim, your attorney can ask the provider to sue to enforce the lien or can put the disputed portion into escrow while the parties litigate.

Hiring the right lawyer and fees

Choose a Texas personal injury lawyer experienced with lien resolution and Medicare/Medicaid recovery. A competent lawyer will:

• identify all potential lienholders early,
• obtain written payoff figures,
• negotiate reductions, and
• hold funds in trust until distribution is safe and lawful.

Make sure you understand how attorney fees and costs are calculated and how those deductions affect the pool available to pay liens. Ask for a written fee agreement that explains how liens will be handled and whether you may be responsible for unpaid liens if the recovery is too small.

Helpful resources

• Texas statutes, searchable: statutes.capitol.texas.gov
• Medicare recovery and conditional payments (federal): 42 U.S.C. § 1395y(b) (govinfo)
• Texas Health and Human Services: Medicaid program information — see official state HHSC resources for Medicaid recovery rules: hhs.texas.gov

Helpful Hints

• Never cash a settlement check until all liens and reimbursement demands are cleared or escrowed.
• Ask providers for a written lien release or detailed payoff letter and keep those in your file.
• If Medicare or Medicaid might have paid related services, request a conditional payment report before settlement.
• Expect negotiation — billed charges are rarely paid in full from a personal-injury settlement.
• Get everything in writing: demands, payoffs, and any agreement to accept a reduced amount.
• Consult a Texas-licensed personal injury attorney before you sign settlement documents or releases.