Detailed Answer

When you negotiate a personal injury or accident settlement in Washington, medical liens and unpaid treatment bills can reduce the money you actually receive. A “medical lien” typically means a provider, insurer or government health plan claims a portion of your settlement to cover treatment costs. Common lienholders include hospitals, ambulance companies, private health insurers (under subrogation rights), Medicare, and Medicaid.

1. Identify All Liens and Bills

Begin by requesting itemized bills and lien statements from every provider. Ask your attorney or claims adjuster to obtain:

• Hospital and ambulance invoices.
• Physician and therapy charges.
• Health plan subrogation demands (see RCW 48.22.010).
• Medicaid recovery notices (RCW 43.20C.020).

2. Confirm Priority and Validity

Washington law gives certain liens priority over others. For example, state Medicaid has a statutory right to recover before private subrogation. Review each claim to ensure it is valid, timely filed, and calculated correctly.

3. Negotiate Reductions

Health-care providers often accept less than the full billed amount. You or your attorney can:

• Present proof you lack ability to pay in full.
• Offer a lump-sum payment in exchange for a lien release.
• Use insurer fee schedules (e.g., Medicare rates) to argue for lower balances.

4. Structure the Settlement

Secure a written agreement outlining:

• Total settlement amount.
• Net proceeds after lien payments.
• Who handles each payment and when.

You may ask the court to establish a Qualified Settlement Fund to deposit proceeds and pay lienholders in the correct order. This avoids disputes over who gets paid first.

5. Obtain Lien Releases

After paying a negotiated amount, request a signed lien waiver for each provider. Without this document, they can claim unpaid balances later.

6. Close Your Claim

Ensure each lienholder is satisfied and confirms no further claims. Then you can distribute the remaining funds to yourself and any attorneys or other parties according to your agreement.

Helpful Hints

• Start lien discovery early. Unpaid bills can delay settlement.
• Use a single point person—often your lawyer—to negotiate all liens.
• Document every payment with a receipt and release form.
• Consider court-supervised funds for complex lien lists.
• Watch statutory deadlines for Medicaid and Medicare recovery.

Disclaimer: This article provides general information under Washington law and does not constitute legal advice. Consult a licensed attorney to address the specifics of your case.