Medical Records and Medical Liens: Building the Paper Trail

I believe my clients. When somebody tells me they're in pain, that's where I start.

The problem is that an insurance adjuster doesn't know you and has no reason to take your word for it. In a personal injury case you can't just say you were hurt. You have to prove it through an unyielding paper trail, and the trail has to come from somebody who has nothing to gain from your claim.

A client can tell an insurance adjuster exactly how they're feeling, the pain they're experiencing, how it's affecting their day to day. And the adjuster won't just take their word for it.

A lot of times clients go see somebody they found off the newspaper, or they do treatment out of a person's house. And these people may actually be effective. They may treat you just fine.

But when it comes down to it, if they don't keep medical records, it's as if it didn't happen.

Your bills and statements showing that you paid somebody help fill in the gap a little. They show you went. But a receipt is just a receipt. There's no diagnosis on it, no treatment plan, nothing about what you told the person or what they did about it. Make sure you're going somewhere that's a medical facility, with an authorized healthcare professional who is going to put a record together. Urgent care, a chiropractor's office, a physical therapy clinic, things of that nature.

If you don't have health insurance, can't afford an urgent care visit, which is typically a little less than $200, and don't think you'll qualify for Emergency Medi-Cal, there's one more option.

It's called a personal injury lien. A medical lien.

A lien works like that, except you're not paying a credit card company back every month. You pay the doctor once your case is over.

So it's basically a piece of paper. It's an agreement between you, the doctor, and the attorney. The doctor is taking a risk by not taking upfront payment from you, not taking health insurance you don't have or that they don't accept, and not sending you to apply for credit. They're saying, this is a deferred payment plan, you can pay me after your case is closed.

They usually want an attorney involved because it gives them a little assurance. If an attorney has taken on the case, it's most likely a case that will result in their bills being paid back in full. They usually won't do it just between you and the doctor, because they don't have that kind of confidence in a person's ability to execute their own claim and get all the compensation needed to cover the bill.

The other thing a lien buys you is speed, and I think that's the part people underestimate. A lien is like a PPO health insurance type of plan. Let's say you need physical therapy. You don't have to worry about Medi-Cal taking five months to approve that visit. It's immediate. The doctor can execute the treatment you need and refer you out to whoever you need to be seen by right away, without a separate approval step in front of every appointment. If you need to start treatment now instead of in five months, that speed is the entire point of the arrangement.

An attorney also vets the doctor for you. If the case ends up needing a lawsuit and that doctor has to testify, we need to make sure they are not going to get cold feet and back out at the last minute. So before a lien starts, we want to interview the doctor and vet them the same way we would vet any other witness. Setting a lien up directly with a doctor nobody has vetted means finding out at the worst possible time.

After the case is over, your payment becomes due. And sometimes that means if the case didn't settle well, or it didn't pan out and recovered no compensation at all, you're still liable for that debt. It's still services the doctors provided you.

That's why I think of personal injury liens as a last resort. Use your own health insurance first. Pay out of pocket if you can. Apply for Emergency Medi-Cal if it might fit. The lien is there for when none of those work. Just go into it knowing it's a debt with your name on it.

The lien doctor is producing the same third party record any other doctor would. So even if the case doesn't pan out, you got the treatment and the records exist. The bill is still there, though.

There's also more than one kind of lien. If a doctor treated you and never got paid, that lien is basically an IOU. Your health insurance company can put one on your case too, and that one works differently, because they already paid the bill and they want it back out of what we recover. Otherwise it would be a windfall, and they'll say, wait a second, you didn't pay for that, we did. Whether that one can be negotiated down depends on the language of the policy and the law governing that plan, and it's a real part of the job.

A lot of times attorneys will just cut off the client's treatment when the case settles, especially if they were treating on a lien. They stop the treatment, the case is over, they give the client whatever compensation and send them on their way.

I feel like that's cold, and it also doesn't really wrap things up very nicely.

If a case settles for the maximum compensation available before a client has finished their medical treatment, we always make sure they're still set, that they have options, and that they know what those options are going forward. And we make sure the bills are all paid.

By the time the case is over and closed out on our end, the client should have nothing left to worry about. They can move on with their life, put this all behind them, and get past the trauma from the accident and the recovery.

Those bills, by the way, are part of what your case is worth. They're the documented medical bills that feed the economic damages calculation in Chapter 7, whether the treatment was paid for by insurance, by cash, or by a lien.