Navigating the Complex World of Indiana Medical Payment Subrogation

Indiana’s medical payment subrogation process can be complicated, and one misstep can mean lost or diminished recoveries. Indiana law imposes significant procedural and legal limitations. Insurers must carefully navigate these challenges to protect and recover their subrogated medical payment claims.

Continue reading to learn what subrogation professionals need to know to ensure successful subrogation of medical payment claims in the Hoosier State:

UNDERSTANDING THE INDIANA MED PAY STATUTE

Indiana regulates subrogated medical payment claims pursuant to what is commonly referred to as the “Indiana Med Pay Statute.”[1] Notably, the statute prevents subrogated carriers from independently initiating a lawsuit to recover medical payments prior to the conclusion of any out-of-pocket personal injury claims of its insured.

Instead, a subrogated carrier obtains a lien on any personal injury recovery of its insured. This lien is created upon providing notice of a subrogated medical payment claim to the insured or, if represented, their attorney. Consequently, a subrogated carrier’s role is limited and must depend on its insured or their attorney to recover and repay the subrogated medical payment claim.

DON’T GET CAUGHT OFF GUARD BY ATTORNEY FEES AND DIMINISHMENT

Following settlement or successful litigation of the insured’s personal injury claim, the insured’s attorney must distribute the proceeds and resolve the subrogated carrier’s medical payment lien.

However, insurance carriers are not entitled to a full recovery of its lien. Indiana law requires subrogated carriers to reimburse the insured’s attorney for the “reasonable and necessary costs and expenses of asserting the third-party claim.”^[2] In practice, this usually amounts to a one-third reduction of the lien.

On top of any attorney’s fees, medical payment liens in Indiana are subject to proportional diminishment.[3] Diminishment of the lien occurs when the insured’s settlement amount is reduced due to comparative fault or due to a diminished personal injury settlement by its insured. For example, if the insured recovers only 30% of their personal injury claim, the subrogated carrier’s lien is reduced by 70%.

WHAT ABOUT CORRESPONDING PROPERTY DAMAGE CLAIMS?

Good news! Indiana’s Med Pay Statute doesn’t limit a subrogated carrier’s ability to recover property damages arising out of the same loss or occurrence.[4] Whether through arbitration, negotiation, or litigation, a subrogated carrier’s right to independently seek reimbursement for property damages remains intact.

Provided the complexities of Indiana medical payment subrogation, even experienced subrogation professionals risk costly setbacks without the right legal support. RMI’s attorneys bring decades of subrogation expertise to every case and bring specialized knowledge of the unique complexities of Indiana’s medical payment subrogation framework.

Since expanding our practice into Indiana just a few years ago, RMI has successfully obtained countless medical payment recoveries for our Clients. Clients can expect the same high level of service and proven results that have defined RMI’s reputation for 35 years. Contact RMI today to discuss how we can support your subrogation needs in Indiana and beyond.

Want To Get in Touch or Forward a Claim for Review?

Phone: 330-769-0911

Fax: 330-769-0922

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