This article discusses general strategies and issues that serve as a primer for a dialogue between a client and his attorney. It is in no way legal advice for any particular individual's particular case and is by no means a substitute for one-on-one advice provided by an attorney.
In our last article we told you about the exciting new laws taking effect August 11, 2010. The law now recognizes that if a health insurer or MedPay provider takes back the money they paid for an injury victim's medical care that may result in a shortfall of money needed to compensate the victim. Essentially, this new law provides a road map and the tools necessary for knowledgeable attorneys to gain an advantage for their clients.
However with the coming of the new laws, astute attorneys need to consider changes in their strategy to gain advantage for their clients. This article is devoted to explaining more fully the "make whole" aspect of the new law, and strategies that need to be considered to maximize the advantages created by this new law.
A) Why "Make Whole" Is So Critical To The Victims' Bottom Line:
The new law provides the opportunity for determination of disbursement BEFORE payment of any subrogation (money re-paid to an insurance company from proceeds of a personal injury settlement). This new procedure allows people whose injuries are more significant to appeal to a tribunal that will determine if the injured party is too injured, even after receipt of settlement or judgment, such that paying back of benefits becomes adjudged legally not required.
So, even if the health insurance contract requires payback of medical expenses, this new law says there is an exception. There are three requirements that must be met for the exception to apply:
(1) the lawyer representing the injured victim must file timely notice, and
(2) the settlement or judgment must be insufficient to make the injured victim whole, and
(3) the health insurance company either fails to request arbitration within 60 days or makes such a request but loses on the merits of the arbitration.
If these requirements are met, the injured person gets a pass on paying back the health insurer.
This new law could mean thousands and in some cases hundreds of thousands of dollars remaining with the victim. It could mean saving a family from losing their home, and could mean the jump starting of an injured victim's life again.
Keep in mind, this new law is ONLY applicable to matters settled or jury trials occurring after August 11, 2010. Conceivably, outcomes of identical cases could be markedly different resulting in substantial lost opportunity and money IF a matter resolves the day before the changing law verses the day after.
B) Change in Strategy:
Any attorney with a current case that has a trial date BEFORE August 11, 2010, which would otherwise meet the requirements laid out above should consider, by any means necessary, continuing that trial till after August 11. It should be noted that such a maneuver could have the affect of delaying the resolution of the case. So, for that reason, the lawyer should have a detailed discussion with his client about the benefits and consequences of move a trial date.
Additionally, a settlement reached on a case before August 11, will operate under the old rules. While, a settlement reached after August 11 will be subject to the new law. Accordingly, for the best interest of an injury victim, delaying settlement might serve to substantially benefit the victim, and certainly needs to be discussed as an option with the client.
Getting a resolution for a client is the goal of every good attorney working in the area of personal injury. But, on some occasions there is the choice between doing something fast, and doing something correct. With the "make whole" doctrine being recently codified, fast may not be the best way to resolve matters at this particular time.
At Anderson, Hemmat & McQuinn, we work hard to make sure that we are current on our understanding of Colorado law so that we can maximize the benefits of the law for our clients. If you have questions about how recent changes in the law could affect your case, please call and speak with one of our attorneys today.