How Health Insurance Coverage Influences Recovery in a Personal Injury Lawsuit

If you’ve been injured in a motor vehicle accident (due to the negligent or wrongful acts of another), then you may be somewhat confused as to how your health insurance coverage affects your ability to recover damages for incurred medical expenses.

After all, it might seem reasonable to the injured plaintiff that they be entitled to recover damages only for losses incurred out-of-pocket.  If your health insurer is paying for all your medical expenses, can you assert such damages in litigation against the defendant?

Thanks to the collateral source rule: yes.  Arizona law gives injured plaintiffs the right to recover for medical expenses, even if their insurer is covering such expenses.

The Collateral Source Rule

In Arizona, as in many other states, the “collateral source rule” applies to a range of personal injury actions.  The rule essentially prevents the jury from being able to consider evidence relating to plaintiff’s receipt of funds from outside sources, such as insurance, so that the defendant cannot escape significant liability simply because the plaintiff had the good sense and foresight to purchase insurance coverage.

In practical terms, the application of the collateral source rule means that you — the injured plaintiff — are entitled to recover damages for any and all legitimate medical expenses, even if those expenses are being covered by your insurer.  Simply put: your health insurance coverage will not negatively affect your ability to secure damages in a personal injury lawsuit.  Claim reimbursement is irrelevant.

Recovering Damages for the Amount Paid

It’s worth noting that the push-and-pull between healthcare providers and insurers often leads to significant pricing negotiation.  In Arizona, injured plaintiffs are entitled to assert (and recover) damages for the actual amount paid by their insurer.

How does this work?

Suppose that you are treated at a rehabilitation clinic.  The clinic charges $100,000 in total for months of treatment.  This treatment is covered by your health insurer.  As such, your insurer negotiates with the clinic and gets the price reduced to $50,000.  When bringing a claim for medical expenses, you will therefore have to claim the amount that was ultimately paid by your insurer: $50,000.

Contact an Experienced Phoenix Accident Attorney for Further Assistance With Your Claims

If you have suffered injuries in a motor vehicle accident that was caused due to the contributed fault of another person or entity, then you may be entitled to recover damages pursuant to Arizona law.  Litigation is not always as straightforward as it initially appears, however — when making a claim for medical expenses, for example, one must take into account the amount actually paid by the insurer.

Here at Hirsch & Lyon, our attorneys have over six decades of combined experience representing injured plaintiffs in motor vehicle accident litigation, including car, truck, and motorcycle accidents.  Unlike other firms, we are specialized in aggressively litigating motor vehicle accident cases to their fullest extent, giving us a substantial competitive advantage in securing compensation on behalf of our clients.

Call (602) 786-7093 today to schedule a free and confidential consultation with an experienced Phoenix accident attorney here at Hirsch & Lyon.  During your initial consultation, we will evaluate your injury claims and help you strategize your next move.