How does subrogation apply if you are covered by an employer-provided plan?
Employer-provided health care coverage plans are governed by the Employee Retirement Income Security Act of 1974 ("ERISA"). Under ERISA, employers may decide to cover the medical expenses of their employees and their families. They may purchase a health insurance policy and pay a premium, or they may set up a "self-funded" or "self-insured" plan. A plan is "self-funded" if the benefits it pays come out of a pool of money collected from the plan's own funds, from employee contributions, or from both. A plan is
"self-insured" if it pays benefits out of its funds, but the money comes from the employer's general funds and not from a separate pool. "Self-funded" and "self-insured" plans may be referred to as "employer-funded" plans. Additionally, an ERISA plan may hire a third party, even an insurance company, to administer a self-funded or self-insured plan.
Employers that purchase an insurance policy may not seek subrogation. However, some employers with "self-funded" and "self-insured" plans may be entitled to seek subrogation out of your recovery. Hiring an administrator does not change the right of the employer-funded health plan to seek subrogation.
Your lawyer must determine what category of health care coverage you have and whether ERISA applies. Your lawyer must then see if your Plan Document retains a right to seek subrogation out of your recovery. Employer-funded health plans must expressly reserve the right to seek subrogation. If you do get a recovery or enter into a settlement and have not addressed the subrogation issue, severe consequences may result, and you may find yourself with far less than you expected. A settlement offer may sound like a big number at first, but remember: your attorney's fees and expenses, as well as the subrogation claim, may have to be paid from that settlement. A good lawyer will address the issue of subrogation before a settlement or verdict occurs. Negotiations over that subrogation claim prior to settlement will help you maximize your recovery. Therefore, it is of the utmost importance that you hire a lawyer who understands subrogation, and the consequences, defenses and techniques that may defeat or minimize the claim.
What can the Quinn Law Firm do for you?
As you can see, the legal issues dealing with subrogation rights of employer-funded health plans are extremely complex. Therefore it is extremely important that you hire a law firm with a full understanding of these issues. At the Quinn Law Firm, we have lawyers who possess the skill, knowledge, and experience to navigate these treacherous waters. Contact us today for a FREE CONSULTATION to discuss how we can help you protect your rights and get the most out of your injury case.
