The answer in Virginia is maybe, but books have been written about this issue, as it can be very complicated. In short, if you have Medicare, Medicaid, Tricare, FEHBA or an ERISA plan, then your plan will be entitled to get its money back. Other health plans in Virginia are not entitled to get the money they paid back from you/your settlement. The hardest one to determine is the ERISA plan. Under the federal law, an ERISA plan must be self funded and must have a subrogation provision before it is entitled to get its money back. Some ERISA health plans are not self funded and some plans do not contain subrogation provisions in their Master Plan Document. Some plans have claimed to have been ERISA plans and entitled to reimbursement when they were not entitled to do so. In some cases, in my opinion, the plan did not know any better as in some states, all health plans are entitled to get back the money they paid out regardless of what type plan they were. In other cases, it has been my opinion that the plan knew it was not entitled to get the money back, it was just going to test the attorney’s knowledge and attention to detail.
Medicare provides a reduction for attorney fees and costs. In some cases, very fact dependent, a discount can be negotiated by your attorney with ERISA, Tricare or FEHBA.
Failure to pay back the lien could result in you losing your health policy and/or in you being sued by the health plan.
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