California Personal Injury and Insurance Blog

Med pay coverage - an update

Twelve or so years ago I wrote one of my first blog posts on medical payments coverage. You can read it here. It is now time for an update, as things have changed - significantly. 

On a car insurance policy, at least in California, and in most states, you are required to have liability coverage. That is it. Just liability coverage. This protects other people if you are at fault for an accident. The minimum limits, in California, are $15,000 per person for an injury, $30,000 per accident for an injury and $5,000 in property damage. That is it. 

But, insurance companies also sell a coverage called "medical payments" or "med pay." This policy pays for your medical bills, or your passenger's medical bills, if you are involved in an accident, regardless of fault. So, let's say you are injured as a result of someone else hitting you. Med pay will pay your bills. If you are injured because you caused a car accident, your med pay coverage will still pay your medical bills. Pretty slick! 

Using med pay does not change your insurance rates. In California, a payment under med pay coverage cannot raise your rates! Remember that. Making a claim under med pay does not raise your rates! 

There are several different types of med pay policies. The easiest is just a simple med pay. You are in a car crash. You incur medical bills. You submit the medical bills to your insurance company. They pay them. Easy! 

Next, there is a med pay policy that has a deductible. This works like your comprehensive or collision coverage. You are involved in a car accident. You incur medical bills. You submit the medical bills to your insurance company. The insurance company pays them AFTER you have satisfied your deductible, typically $500. 

Then there is a med pay coverage with a copay. Think about health insurance. You are involved in a motor vehicle collision. You incur medical bills. You submit the medical bills to your insurance company. They pay 80% of the bill. You pay the other 20%. Your copay could also be a flat amount, like $20 per visit. But typically it is a percentage.

Finally, there is excess med pay. You are involved in a motor vehicle collision. You incur medical bills. In this case, you submit your bills to your health insurance. They send you an explanation of benefits that shows your bill is either paid, not paid, or paid subject to a copay or deductible. When you get that EOB, you then submit it to your car insurance with the bill from the provider. 

Understanding med pay is important. This is one of the many reasons you cannot shop insurance by the price. You need to understand the difference in med pay coverages and which one works best for you and your situation. Having an insurance agent explain this to you, and not just going online or using a 800 number, is important. 

Of course, if you are unsure of what you have, ask questions! 

 

Don't let the insurance company restrict your treatment

I have seen a new trend with people calling me - and quite frankly, it is disturbing. Someone gets in a crash. They call the other party's insurance company and report a claim. They get transferred to an adjuster. After a few questions, the adjuster says something along the lines of "We are sorry to hear that. You should go to the doctor. They can treat you up to 10 times." 

So they go. And they treat 10 times. But you know what? They are still hurt. But they stop treating. The adjuster makes them some ridiculously low offer. They don't like it and then they call an attorney. By then, hopefully we can still help them. 

The problem with this is simple: an adjuster should not be dictating your treatment. Just like I won't dictate a client's treatment, I leave that to the doctor. I figure I went to law school, not medical school. I need to let the doctors tell my clients what treatment they need, how often, etc.... 

The same applies to the adjuster. The adjuster, especially those front line adjusters, does not have a medical degree. They do know how to read a script, tell you what you are supposed to hear, and try to resolve the claim. Heck, some insurance companies are now offering you money, sent via electronic transfer to your account, if you settle in the first few days. 

Do NOT let an adjuster dictate your treatment. Go to the doctor. Listen to the doctor's advice. And make sure you make a full recovery! Oh, and talk to an attorney so you know your rights. 

Save some money on car insurance

I am a big proponent of not shopping for insurance solely based on price. There are other important factors. But, for some people, price is the biggest factor. And for some people, two insurance companies may offer the same personal service, the same claims processes and the same service. So then it may come down to price. If you are shopping on price, or using it as a factor, here are 8 tips to save money from the Atlanta Journal Constitution.

1. Don’t assume any one company is the cheapest

        A recent NerdWallet analysis found a difference of $859 a year between the average insurance quote and the lowest available quote.

2. Don’t ignore local and regional insurance companies

3. Check for discounts
4. Pay your bills on time
5. Consider insurance costs when buying a car

        A NerdWallet review of rates for best-selling vehicles in 25 cities found that the Toyota Camry, for example, cost an average of $187 per year more to insure         than the comparable Honda Accord.

6. Skip comprehensive and collision if you do not need it on an older, lower value car.

           Of course, if you need the car and cannot afford to replace it, then you should keep your comprehensive and collision coverage.

7. Raise your deductibles

8. Consider usage-based plans, especially if you don’t drive much

        If you’re a safe driver who doesn’t log very many miles, consider a usage-based insurance program, such as Allstate’s Drivewise, Progressive’s Snapshot or State Farm’s Drive Safe and Save. By signing up for these programs, you allow your insurer to track your driving electronically in exchange for possible discounts, based on how much you drive, when you drive and how well you drive.

If you drive less than 10,000 miles per year, you might be able to save money with a mileage-based insurance program.

I hope these tips help. And remember, I offer a FREE insurance review for any California resident for homeowners and auto insurance. 

FAQ: Am I responsible for my medical bills after a car accident?

Question: I was involved in a car crash. I have medical insurance. Am I responsible to pay these bills back when I settle my case?

Answer: This is based on two recent cases I have had!  I wish it wasn't, but two clients hired me on cases because the other party's insurance company told them lies about their bills. In the first case, my client was told he would not have to reimburse Rawlings, who was collecting on behalf of Blue Shield. In the second case, my client was told that she would be personally liable to Kaiser if she did not settle the case. The one thing these two cases have in common: both people were lied to by adjusters. (I don't like using that word, but it is the only word that fits!) 

Let's start with the easy scenario. There are a ton of different scenarios I can give you. But, to keep things simple, I am going to give you the three most common: you have no health insurance, you are insured by a health plan that is not Kaiser and you are insured by Kaiser.

You are involved a motor vehicle collision and you do not have insurance. You incur bills for your treatment. You are personally liable for these bills and MUST pay them back. You MAY be able to negotiate them, but your creditors are coming after you - one way or another. So if you settle your case, you pay them back. If you don't settle your case, they sue you. If you do not pay them back, they will sue you for the money. Easy, right?

Now, we can make it harder. You have insurance with Blue Shield or Blue Cross or Anthem or Aetna or CIGNA or.......... well, you get the idea. They pay your hospital bill and doctor's bills. You go to settle your case. You get paid. Generally, they are entitled to any money you recover from a third party (3rd party). A third party is the other person - or the other person's insurance company. So when you settle your case, you have to pay them back. Now, sometimes you can pay them back less then they paid you. But, if it is an ERISA plan, in other words, paid for by your employer, you generally have to pay them back in full. 

What about if you have Kaiser? I know, Kaiser doesn't bill you. Right. But, wrong too. When you are injured as a result of someone else's negligence, such as a slip and fall or car accident, Kaiser hires a company called Equian (it used to be called Trover and before that, Healthcare Recoveries). Equian obtains your records and prepares a bill. They send that bill to you or to your attorney. You then have to pay them back. But, unlike the ERISA plans discussed above, Kaiser will typically reduce the amount you have to pay back. So, that is the good news. 

The moral of the story: do NOT trust the adjuster. Nope. Never. Do not do it. The adjuster is going to tell you whatever they need to tell you so you will settle your case. Do not listen to them. If you are unsure about whether you have to pay back your medical insurance or your medical providers, then talk to an attorney. Get some actual advice from someone you trust and someone who is on your side! 

Don't trust insurance companies - a true story

Let me relate a real story about why you should never trust an insurance company. This is for a case I am currently working on. As background, my client was rear ended in a car accident by an unlicensed, uninsured driver. 

A client of mine was involved in a car crash. He went to the ER. His health insurance paid $4,000 of a $10,000 bill. His own insurance company, GEICO, offered to settle the case with him and told him it was based on $4,000 in medical bills. 

The problem? The client is still on the hook for the other $6,000. This is called balance billing and it is legal in California. In other words, you may get stuck with a balance for emergency room treatment even after your insurance company pays the bill. 

The adjuster knew this, admitted to me that he knew it, and had no problem with the fact that he lied to my client/their insured. Yes, their own customer they lied to and had no issue with it. The client called me for a consultation. I helped him through this mess and we will get his case resolved. 

The moral of the story: do not trust insurance companies. I don't care if it is a "small crash" or a large crash, you need to at least consult with an attorney about your car crash.

There are still no formulas for personal injury cases - including car accidents

I have been saying this for 12 years while running my own law firm. Prior to that, I said it for almost a decade working for insurance companies. And yet, despite what I say, people do not listen. So let's try it again - there is NO formula for settling a personal injury case, whether it is a car accident, slip and fall or any other type of injury. 

First, despite what some adjuster might tell you, and what you will read on the internet, there is no secret formula or book that tells you what your case is worth. Insurance adjusters are big now in telling people that they have reviewed the information and their formula tells them that the case is worth a certain amount. Heck, I heard it yesterday! Trust me, juries do not use formulas when they evaluate cases and good personal injury attorneys do not use formulas either.

Each case has its own value and the insurance companies alleged "formula" is not accurate. If it was simple as multiplying your medical bills by a certain number, a lot of people say 3 times your medical bills, then there would be a lot of unemployed attorneys, on both sides, and a lot of unemployed adjusters. Think about the money insurance companies would save by firing their adjusters. And, make no mistake, insurance companies like saving money! There is no formula for settling a claim as every claim is different and every situation is different! 

The adjuster will also try to talk you out of retaining an attorney. The adjuster will tell you that it does not increase the value of the case. That is complete garbage. An attorney with experience can help you maximize your recovery. In fact, a study by Allstate, and confirmed by other insurance companies, showed that people who hired an attorney recovered more money than someone who did not hire an attorney. In other words, hiring an attorney resulted in a larger net settlement for the injured party. (By the way, add in that you have less stress, don't have to talk to the adjuster, and don't have to worry about missing some deadline and it makes more sense.) They just don't want to publicize these studies! 

Talk to an attorney and find out the real value of your case. Do not assume there is a formula, despite what you might read online! 

The Statute of Limitations

 

The what of what? I typically hear people call it the statue of limitations. However, folks, it is not a statue. It is a statute, or a law. The statute of limitations tells you how long you have to sue someone for something. We don't want people to do something today and then be sued in 20 years. Witnesses forget things, evidence is destroyed, people move on with their lives. So we have this handy dandy law that limits how long you have to sue someone. Here is a shortcut. This does not provide every statute of limitations and you should talk to an attorney about YOUR specific facts. Do not rely on this as telling you what your statute of limitations is! 

 

• Medical malpractice actions: Three years from the date of injury or one year from the date of discovery of the injury, whichever occurs first.
• Suits for libel or slander: One year.
• Personal injury claims based on negligence: Two years.
• Suits for injuries resulting from domestic violence: Three years from the last act of domestic violence.
• Childhood sexual abuse: Eight years from the victim's 18th birthday or three years after the victim realizes that physical or psychological injury has resulted from childhood sexual abuse, no matter what the victim's age.
• Property Damage: There is a three year time limit to file a lawsuit for property damage, from the date that the damage occurred.
• Government Agency Claims: The claim filed against the government agency has a time limit of six months from the date of the incident.

The point of this is a simple reminder: do NOT wait to talk to an attorney if you have been injured. You could miss a deadline. For example, if you get in a car crash and you don't realize the other driver was working for the State or County, you could miss the six month government tort claim statute. 

If you have any questions about a specific statute of limitations, talk to an attorney! 

Uninsured/Underinsured Motorist Coverage

Of all the automobile insurance coverage that exists, Uninsured Motorist Coverage (UM) is THE MOST important coverage. (In California, uninsured motorist also acts as underinsured motorist coverage.)

Why is Uninsured Motorist Coverage so Important? If you buy UM coverage and a driver who has no insurance injures you, your insurance company will pay your damages up to the limit of your UM coverage. Since the other driver is uninsured, or underinsured, your insurance company “steps into the shoes” of the insurance the other party should have had and pays the claim. UM coverage also will pay you if you are the victim of a “hit and run” and the other driver is never caught. However, you must meet certain requirements, but this coverage can be very important. For example, if you are hit by a hit and run driver, you need to have the license plate number and a police report to have coverage under most policies. 

Example: You are stopped and hit by a person who has no insurance. You are injured as a result of the collision. Your insurance company will pay you for your injuries since the other person did not have insurance. 

UM also acts as Underinsured Coverage. If you get hit by someone who has less insurance than you, and your injuries are worth more than the other person’s insurance, your insurance company will pay you the amount of your claim up to the limits of your
coverage.

Example: You are stopped and hit by a person who has a $15,000 policy. You are injured and your medical bills are $30,000. His insurance company will pay you the $15,000 and your insurance company will pay you the difference. However, they only pay you up to your limit. So if your limit is $25,000, you would only be paid $10,000 more. 

Does this sound like something your insurance company has told you? Probably not.

Why aren’t they telling you this? Well, uninsured motorist coverage is relatively inexpensive to increase. Therefore the increase from a $30,000 insurance policy to a $100,000 policy generally will only cost you a few more dollars per policy. However the coverage is substantially greater, in this case, more than three times greater.

Why is this the most important insurance coverage you can have? Uninsured motorist and underinsured motorist protect YOU! Let me say that again: this insurance protects you. Let's say you are the sole income earner in your house. An uninsured motorist hits you and makes it so you can't work for 6 months. Your uninsured motorist coverage makes sure that you get compensated for your injuries. Why would you have $100,000 of protection for other people but only $15,000 or $25,000 for yourself? You wouldn't but because most people don't really understand this coverage, they make this mistake - constantly! And your agent doesn't tell you this! 

Remember, about half of all drivers in California are uninsured. About another 25% are underinsured. So 3 out of every 4 drivers do not have enough insurance to compensate you if you are injured or your car is damaged in a crash. Your solution is uninsured motorist coverage. 

Have any questions on this? Email me or call for a free consultation! 

Ontario Canada Court Authorizes Class Action Against Canadian Attorney

This came across my desk and was interesting enough that I wanted to pass it on. An Ontario court has authorized a lawsuit against a personal injury law firm. According to the story, 6,000 clients are able to "participate in a lawsuit alleging that the firm entered into improper fee agreements, took unauthorized fees, failed to obtain required court approval and charged illegal interest rates on disbursements."

This is a quirk in Canadian law that is different than US laws. The way that fees and costs are calculated in Canada is slightly different. In California, the attorney can charge you for incurred costs and fees per the fee agreement. You should receive a breakdown of the costs. The fee can either be a net fee based on the settlement less the costs or a gross fee based solely on the settlement. 

This is an interesting case. I am curious to see how it turns out. When you hire an attorney, make sure you understand how your fees will be calculated. 

Do you need insurance for your drone?

I was looking at a drone and Google, being smart, also gave me a link to a Bloomberg Business story about drone insurance. My first thought was "what?" Drone insurance? But as I read the article and started to consider it, I thought it was interesting.

Drones, as you may know, are regulated by the FAA. As such, there are some federal regulations that apply. However, there is not a requirement that you have insurance. So, what happens if your drone is either damaged or causes damage?

The first question is easy. Most of us are spending $75 to $100 on a drone. In that price range, if your drone is damaged, you would just replace it. Even if it is covered by your homeowners insurance, this would be under most people's deductibles. So you just replace it and move on. 

The second question is more interesting. What happens if your drone hits a car and damages it? Or your drone hits a kid and hurts him? Now you have a drone bodily injury claim. 

The Academy of Model Aeronautics has one solution. For $75 per year, you can join and they provide you with access to a $2,500,000 liability policy. This would cover property damage and most, if not all, injuries caused by a drone. This would allow the injured person to receive compensation. 

But, what if you do not want to spend the $75 on joining this group? Your homeowners insurance SHOULD provide coverage. I say should because every homeowners policy is different. You need to read your policy. If you have questions, you need to call your agent and ask, specifically, if injury or damage done from a drone is covered by your policy. Each insurance company is going to have a different policy. My agent told me that my policy will cover a drone caused injury. But your insurance company may have a different interpretation. 

Of course, if you are injured by a drone, talk to an attorney about your rights. You may have a claim against the drone operator!