If you've been in a recent Ohio car crash, there's a money grab you need to know about. It's a race by hospitals to bill your auto insurance medical payments coverage and avoid billing your health insurance at all costs.
Here's how it works. After your crash, you may be taken to or visit your local hospital ER for medical treatment. Within minutes of your arrival, you'll be asked for insurance information, and some "papers to sign." You give them your health insurance information. They also ask for your auto insurance information, because your injuries are collision related. Most people who have auto insurance also have "medical payments coverage," which will pay medical bills that are crash related, up to the limits of that coverage--usually $1,000 or $5,000 (which is what most people carry).
Occasionally, you may be asked to sign an "assignment" or other similar document authorizing the hospital to bill your auto insurance company directly. Or, this document may require you to pay the hospital bills directly out of any possible future settlement you receive with the responsible driver's insurance company.
Never mind the fact that you've been banged up or injured or woozy from medications and probably had no idea what you were signing even if you had your wits about you.
Why is your hospital trying to avoid billing your health insurance company and instead trying to get payment from your auto insurance company or out of your settlement?
The reason is simple: $$$$$. Big health insurance companies typically enter into "network" agreements with medical providers like hospitals and doctors. These agreements limit what hospitals are paid for various services. Example: On a hypothetical $2000 hospital bill, the patient's health insurer might pay $500 as payment in full. The hospital might still bill you for any co-pays you owe or deductibles you've not met under your health insurance plan, but that's it. The hospital is stuck with what your health insurance pays.
Your auto insurance might be a bit more generous by paying a higher amount for that same $2,000 bill. It might pay $1,200 or $1,400 or even pay it in full. So, for a few hundred months more, the hospital will try to avoid billing your health insurance at all costs, even though they are in the health insurance company's network and despite the fact that your health insurer covers auto accident related bills.
Pure and simple, hospitals are looking for "greener" pastures for payment of their bills (pun intended). What can you do? One thing you can do is submit the bills to your health insurer and insist that it pay the bills. If you have auto insurance med pay, it should serve as a backup to what health insurance doesn't cover. But don't bother asking the nice account manager at the hospital to submit the bills to your health insurance. Most likely, you'll be told: (1) they are required to bill your auto insurance; (2) they're not allowed to bill your health insurance; or (3) you signed papers authorizing them to directly bill your auto insurance.
Keeping track of this race and untangling it can get really complicated, especially as time goes on. More often than not, you will bang your head against the wall, and eventually call a personal injury attorney like me to sort out the mess.
But if you wait too long, it may mean money going right in the hospital's pocket and right out of yours.
Wednesday, February 26, 2014
Thursday, February 6, 2014
When I ask clients (typically at the first client meeting) what kind of auto insurance coverage they have, the response is almost always: “I’ve got full coverage.”
Or at least they thought they did.
A recent case – Robson v. Cadd Agency – points out an all too familiar scenario when folks attempt to buy auto insurance. It goes something like this. Purchasers tell their agent they want a “full coverage” policy.
Agent then gets some quotes for some policies. So far, so good. But here is where things start to break down. Most purchasers of insurance don’t really know what a “full coverage” policy means.
At a minimum, it includes liability coverage, which covers you if you get sued. But does it include the most valuable coverage you can buy – uninsured and underinsured motorists (UM/UIM) coverage – which protects you and your family if clobbered by a driver with no insurance or low limits of liability insurance?
Does it include medical payments coverage? Collision coverage? Rental coverage? Does the policy cover your family members living in your household? Does it prohibit a spouse or children from making a claim for injuries if injured due to the driving negligence of another spouse or child? Does it cover your injuries if you’re smashed by a drunk driver while driving your company car?
Bottom line: There is no definition in the insurance industry for what constitutes a “full coverage” auto policy. It is a useless, garbage term that means NOTHING!
In the Robson case, a business owner asked her agent for a “full coverage” commercial auto policy for a dump truck. The owner claimed she insisted on having UM/UIM coverage. What she got was an auto policy that did not include UM/UIM coverage.
You can guess the rest: A collision with an underinsured driver and injuries to the dump truck driver. When a claim was initiated for benefits under the UIM policy, it was denied. The agent claimed that the owner didn’t want UM/UIM coverage after all, which the owner denied.
A classic “she said/he said” situation. And a lawsuit. The larger point here is that the model for buying and selling auto insurance is a broken one, replete with misunderstandings and misinformation.
It is a model driven by price, and purchasers essentially have little to no idea what they’re buying and what all the fine print means . . . until they’re clobbered in a crash.
And, oh, by the way – under Ohio law, purchasers have a duty to read and understand their insurance policy! This is the most ridiculous fallacy of all. Just try to sit down and read AND understand your auto policy without pulling out your hair or falling asleep.
Insurance companies have NO interest in educating you as to what you are actually buying, and neither do many agents. More often than not, it’s all about “saving you money” or “saving 15% on your car insurance” and all those other useless slogans.
The only way to fight back and buy the protection you deserve is to educate yourself. That’s why we wrote, “Fully Exposed: How Insurance Companies are Stripping Your Auto Policy.” It’s a quick read about many of the mistakes people make when buying auto insurance, through no fault of their own.
If you don’t properly arm yourself, it’s like brining a knife to a gunfight. And, in the case of the insurance industry, you’re facing a howitzer.
The book is available for free on our website.