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DEALING WITH SUBROGATOION IN SETTLING AN AUTO ACCIDENT CASE

May 19

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5/19/2014 7:35 AM  RssIcon

            The victim’s claim for damages against the negligent driver’s insurance will include the cost of medical treatment that was necessitated by injuries sustained in the auto accident.  The cost of that medical treatment, most often is paid for by some entity (Payor), such as the victim’s health insurance, Medicare, worker’s compensation or Medicaid.  The entity that paid for the medical treatment most always has a lien on any settlement proceeds the victim gets from the liability insurance carrier (Third Party Insurance Carrier) for the negligent party who caused the injuries.  The payor’s lien is protected by a legal doctrine known as subrogation.

            In Texas, what I see most often is that the negligent party has minimum limits liability insurance ($30,000).  In Texas, the victim in an auto accident case is rarely ever going to collect more in settlement money than the limits of the negligent third party’s insurance, plus whatever underinsured/uninsured motorist coverage the victim has on his/her automobile policy.  No matter how much insurance is available to the victim, the insurance carriers will never settle the case until all subrogation liens are satisfied.  In some cases the subrogation liens are larger than all the liability and underinsured money available for settlement.

            The Payor’s subrogation lien is dependent on the status of the particular Payor or plan.  The main categories of Payors are Medicare, Medicaid, private health insurance plan, ERISA insurance plan, ERISA self-funded plan, veteran’s benefits and Worker’s Compensation.  The entity holding the lien is generally referred to as the “Subrogee.”

            The law applicable to the rights of subrogees is very complex, but is greatly favors the rights subrogees over the rights of victims.  Every victim who is pursuing recovery of money damages from the negligent third party insurance carrier must understand that they are not going to get any money until and unless the subrogee’s lien is satisfied.

            Attorneys who represent the victims most often can negotiate with the subrogee and reach a compromise with the subrogee to satisfy the lien out the victim’s recovery for a reduced amount.

            The new Texas Civil Practice & Remedies Code, chapter 140 provides for reduction of subrogation liens in many instances.  However, it does not apply to a self-funded ERISA plan or a Hospital lien.  The subject of subrogation is taught at Texas State Bar Seminars for advanced personal injury law.  The course material in 2014 was 260 pages long.  It is a complicated area of the law.

            It is my opinion that car wreck victims will be better off by retaining a board certified personal injury attorney with past proven experience handling auto accidents and in managing subrogation liens.

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VERDICTS AND SETTLEMENTS in which Rockne W. Onstad was Lead Counsel or Co-Counsel

Gross Amount Client Recovery Attorney Fee Expenses Nature
$13,650,000 $8,055,000 $5,460,000 $135,000     Product Liability, Apache Helicopter Gear Box, Spinal Injuries (settlement)
$9,200,000 $6,320,064 $2,760,000 $119,358     Product Liability, Defective Aircraft Carburetor, Wrongful Death (settlement)
$6,800,000 $4,473,334 $2,266,666 $60,000     Premises Liability, Brain Injury, Water Park Slide (settlement)
$5,000,000 $3,662,224 $1,250,000 $87,775     Obstetrical negligence, cerebral palsy, Federal Tort Claim Act case (settlement)
$4,980,000 $2,437,000 $2,490,000 $53,000     Obstetrical Negligence, Fetal Asphyxia, Cerebral Palsy (settlement)
$4,300,000 $309,000 $138,000 $13,000     Pilot Error, Airplane Crash, Wrongful Death (jury verdict)
$3,850,000 $2,373,000 $1,425,000 $52,000     Labor & Delivery Negligence, Fetal Distress, Cerebral Palsy (settlement)
$3,500,000 $2,028,000 $1,400,000 $72,000     Product Liability, Design Defect, Spinal Cord Injury (settlement)
$3,235,000 $2,361,250 $808,750 $65,000     Brain Injury, Federal Tort Claim, FAA Negligence (verdict) affirmed on appeal
$3,000,000 $1,724,000 $1,200,000 $76,000     Neurosurgical Malpractice, Cauda Equina Syndrome (settlement)
$2,950,000 $1,731,000 $1,180,000 $39,000     Defective Design of Helicopter, Paralysis & Wrongful Death (settlement)
$2,900,000 $844,000 $694,000 $26,000     Auto Accident, Spinal Injury & Ankle Injury (jury verdict/settlement)
$2,800,000 $1,864,667 $924,333 $12,000     Premises Liability, Hotel Fire, Wrongful Death (settlement)
$2,500,000 $1,644,667 $833,333 $22,000     Product Liablity, Defective Farm Tractor, Arm Loss (settlement)
$2,500,000 $1,400,000 $1,000,000 $100,000     Product Liability -- crashworthiness - roof crush - spinal cord injury
$2,300,000 $1,399,000 $960,000 $41,000     Anesthesiologist Negligence, Brain Injury (settlement)
$2,300,000 $1,091,000 $920,000 $59,000     Product Liability, All Terrain Vehicle, Spinal Injury (settlement)
$2,200,000 $1,321,000 $733,333 $44,000     Cerebral Palsy, Obstetrical Malpractice, Preeclampsia (settlement)
$2,200,000 $1,267,000 $880,000 $53,000     Construction Negligence & Insurance Bad Faith, Spinal Injury(settlement)
$2,200,000 $1,191,000 $880,000 $129,000     Product liability, subdural hematoma (settlement)
$2,183,796 $1,426,334 $557,666 $163,796     Hospital Labor Nurse Negligence, Fetal Distress, Cerebral Palsy (settlement)
$2,000,000 $1,303,334 $666,666 $30,000     Anesthesia Malpractice, Esophageal Intubation, Wrongful Death (settlement)
$2,000,000 $1,106,887 $800,000 $93,111     Radiologist Negligence, Brain Catheterization, Stroke (settlement)
$2,000,000 $976,484 $976,482 $47,034     Obstetrician Malpractice, Forceps Delivery, Cerebral Palsy (settlement)
$2,000,000 $972,331 $972,669 $55,000     Obstetrical Malpractice, IUGR, Cerebral Palsy (settlement)
$1,900,000 $905,000 $950,000 $45,000     Clinic Failure to Supervise Impaired Physician, 4 Injured (settlement)
$1,900,000 $73,000     Pilot Error, Helicopter Crash, Wrongful Death (jury verdict-no insurance coverage)
$1,860,000 $978,518 $645,000 $137,480     Neurosurgeon Negligence, Infection, Cauda Equina Syndrome (settlement)
$1,700,000 $1,130,730 $565,363 $3,907     Product Liability, Defective Design, Burns (settlement)
$1,500,000 $847,000 $600,000 $53,000     Defective Aircraft Component, Military Aircraft, Wrongful Death (settlement)
$1,425,000 $900,310 $457,571 $67,119     Intraoperative Spinal Cord Monitoring Negligence, Spinal Cord Injury (settlement)
$1,400,000 $848,221 $503,552 $51,227     Obstetrician Malpractice, Group B Strep Infection, Cerebral Palsy (settlement)
$1,400,000 $718,689 $560,000 $130,522     Neurosurgeon Negligence, Infection, Brain Injury (jury trial & settlement)
$1,400,000 $818,000 $560,000 $22,000     Auto Trucking Accident, Spinal Injury (settlement)
$1,350,000 $926,394 $370,835 $52,769     Wrongful death. Unnecessary hysterectomy (settlement)
$1,300,000 $718,689 $520,000 $26,000     Neonatal Nurse Negligence, Visual Impairment (settlement)
$1,300,000 $285,000 $250,000 $33,189     Emergency Room Negligence, Wrongful Death (jury verdict and settlement))
$1,237,000 $718,689 $400,000 $30,000     Cardiologist Negligence, Brain Injury (settlement)
$1,200,000 $659,879 $395,666 $144,455     Prolapsed umbilical cord, Labor Nurse Negligence (settlement)
$1,167,000 $594,086 $417,000 $72,513     Emergency Room Negligence, Heart Attack, Wrongful Death (settlement)
$1,150,000 $727,667 $383,333 $39,000     Obstetrician Negligence, Group B Strep, Cerebral Palsy (settlement)
$1,111,000 $594,933 $444,400 $71,623     Product Liability, Heart Stent, Heart Damage (settlement)
$1,100,000 $770,000 $440,000 $25,996     Radiologist Negligence, Failure to Diagnose Breast Cancer, Death (settlement)
$1,100,000 $639,000 $406,000 $54,000     Emergency Room negligence, wrongful death, heart attack
$1,100,000 $639,000 $406,000 $54,000     52 year old male presented to hospital emergency depart by ambulance suffering from aortic stenosis. He was cursorily evaluated and dismissed. He later died from the effects of the aortic stenosis
$1,060,000 $532,715 $478,991 $48,810     Obstetrician Negligence, Breech Delivery, Cerebral Palsy (settlement)
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