Archive for the ‘Insurance Coverage’ Category

Why umbrella insurance policies are money well spent

An umbrella insurance policy provides an additional layer of coverage above the coverage provided by an automobile insurance policy. An automobile insurance policy has three “pots” of coverage: (1) a per individual coverage limit for bodily injury or death; (2) a per accident coverage limit for bodily injury or death caused to more than one person; and (3) a per accident property damage coverage limit.

In the State of Texas all non-commercial drivers are required to carry a minimum of $30,000 per person for bodily injury, $60,000 per accident for bodily injury, and $25,000 per accident for property damage. See Texas Transportation Code Sec. 601.072. This is often referred to as a minimum limits policy, or a 30/60/25 policy. Anyone who has ever had any significant medical treatment will appreciate that $30,000 will not go very far given how expensive medical care is nowadays: you could easily spend twice that amount on a simple surgery for a broken wrist or arm.

Different insurance companies offer different policy limits that people can purchase, but the typical coverage increments aside from minimum limits are:
50,000/100,000/50,000
100,000/300,000/100,000
250,000/500,000/250,000
300,000/500,000/300,000

So someone with what would be considered a lot of car insurance may have up to $250,000 of coverage for bodily injury/death caused to one person. That sounds like a lot, and compared to what the average person carries it is a lot, but if the person insured under the policy causes a fatal accident or injures someone so severely they may not be able to work again, $250,000 is a drop in the ocean.

An umbrella policy typically provides an additional $1,000,000 of coverage above and beyond the coverage on an automobile policy. Relative to the cost of the primary automobile policy, umbrella policies are typically not too expensive. Depending on the demographics of the person buying the policy and their driving record, a $1MM umbrella may only cost a couple of hundred dollars for a year’s worth of coverage.

Having an umbrella policy will serve two important purposes: it will protect the assets and property of the person covered under the policy should they cause an accident resulting in very serious injury or death. It will also ensure that in the event of such an accident, the injured person or their family is more likely to be adequately compensated and the claim settled within the insurance policy limit.

Health insurance liens and personal injury settlements

If you were injured in an accident that was caused by the negligence of a third party, and some or all of your bills are paid by health insurance, your health insurance company may claim a lien against any insurance settlement you get from the third party that injured you.  Basically the health insurance company wants to get their money back out of the settlement.  Their lien would be up to the amount they paid toward your medical bills (but no more than that).

There are two types of health insurance plan: ERISA plans and non-ERISA plans.  The fundamental difference between the two types is who ultimately pays the bills.  In an ERISA plan the medical bills are paid by the employer providing the health insurance coverage, but the plan may be administered by someone like Blue Cross Blue Shield, Aetna or Humana.  In an ERISA plan the health insurance company (e.g. Aetna) administers the plan and handles claims, but at the end of the day the employer pays for the medical treatment.  In a non-ERISA plan, the health insurer (not the employer) pays for the treatment.

The difference between ERISA and non-ERISA health insurance plans matters because as a matter of federal law, an ERISA health insurance plan is entitled to dollar-for-dollar reimbursement of their lien out of the third party settlement proceeds.  Put another way, if an ERISA plan pays $1,000 on a hospital bill you have due to a car accident, the plan is entitled to get paid back $1,000 out of your car accident settlement, and if they don’t want to reduce their $1,000 lien they don’t have to.  If a non-ERISA plan however, the health insurer is more likely to agree to reduce the lien.

Health insurance companies are able to take out a lien against your recovery because they wrote subrogation language into your health insurance contract.  Your health insurance contract is probably many, many pages in length.  Buried somewhere in the contract is a subrogation clause that says, in essence, that if the health insurance plan pays your bills because a third party injured you, the plan is entitled to get reimbursed out of any settlement you get from the third party. Health insurers usually use a third party service to administer their liens, such as ACS Recovery, Benefit Recovery, The Rawlings Group and others.

Health insurance companies do not always pursue their lien by notifying the injured person’s attorney or the third party’s health insurance company however.

Please note that special rules apply if medical bills are paid by Medicare or Medicaid as opposed to other private health insurance.  Medicare and Medicaid liens must be paid out of the third party settlement proceeds, and if the third party’s insurance company (GEICO, Allstate, etcetera) thinks there may be a Medicare or Medicaid lien, they will not release any settlement proceed without something in writing stating the amount of Medicare or Medicaid’s lien, or alternatively they will name Medicare or Medicaid on the settlement check.

I’m shopping around for car insurance – are there any GOOD car insurance companies?

1
Sep 2011
By:

A lot of times we find ourselves empathizing with clients who have had a BAD experience with their own insurance company or more frequently, the insurance carrier of the third party who caused the car accident. Any seasoned Plaintiffs personal injury attorney can tell plenty of stories of insurance companies treating people unreasonably or unfairly. Every now and again a client will ask: “Are there any GOOD insurance companies in Texas that you’d recommend?” Actually, there is.

Most of us are guilty of shopping for car insurance: (a) purely based on price, the lower the premiums the better; and (b) without really thinking too much about what expectations we would have of our car insurer if we call upon them to handle a claim. Obviously nobody wants to pay a dollar more than is necessary for car insurance, but there’s a lot to the old saying “You get what you pay for.” Notwithstanding the television commercials that talk about how much you save if you switch to a particular insurance company, premiums probably don’t vary as much as they’d like you to believe.

There are a number of claims scenarios that may cause you to call on an automobile insurance to handle a claim. You may have caused an accident and need your insurer to handle damage to your vehicle, the other driver’s vehicle and injuries to one or both of you. You probably don’t want to get sued, so ideally you’d like your insurance company to handle the other person’s claim in a reasonable way. Alternatively the other driver was at fault and now you are making a claim with their insurance company to take care of your vehicle damage and medical bills: you don’t want to sue the other driver and turn a car accident into an 18-month long lawsuit, so you hope the other driver’s insurance company treats you fairly.

It has been the repeated experience of our attorneys that Texas Farm Bureau Insurance stands out as one of the most reasonable automobile insurance companies we regularly deal with in reference to claims made on personal automobile insurance policies. Cynically people might say: “Well they must pay more and that’s the reason you like them” but that’s not it. Unlike some automobile insurers that seem to have a revolving door with employees constantly leaving to work elsewhere, typically Farm Bureau claims adjusters have been with the company for ten years or more. It usually speaks well of a company that they are able to hang on to their employees for the long haul. It has also been our experience that Farm Bureau adjusters genuinely want to handle their customers’ claims fairly and efficiently.

This is not to say that all other automobile insurance companies that write policies in Texas are bad, just that over many years of experience and handling thousands of clients’ claims, we’ve noticed that Texas Farm Bureau does a good job of handling first party and third party claims for its customers. If you’re shopping around for car insurance you might give them a look.

The importance of a police crash report for a Houston car accident

You have just been involved in a car accident. Your vehicle is damaged and you are injured. The other driver suggests you just exchange information and that the police don’t really need to be involved. You don’t want to seem like a bad guy but you think a police report might be a good idea.  What should you do?

GET A POLICE REPORT!

Pursuant to Texas Transportation Code Section 550.062, a police officer investigating a motor vehicle accident in the regular course of his/her duty shall make an accident report when the accident resulted in the death of injury of a person OR there was damage to any one person’s property that appears to amount to $1,000 or more. If you call to request police assistance for your car accident, you should state on the phone whether someone is hurt or if there appears to be more than $1,000 in damage to one or more vehicles, you should say so.

A police crash report of the type used by law enforcement officers in Texas records a lot of information. The report will include information about the drivers involved, their insurance information and usually the statements of the parties involved and the officer’s opinion as to who was at fault. Texas law enforcement agencies are now able to determine at the scene of an accident whether the vehicles involved are covered by valid liability insurance. Requesting the police respond to your car accident may help save hours of frustration on the phone later trying to determine if the other driver had valid insurance.

Another benefit of getting a police crash report for your car accident is that it will help reduce the “he said, she said” factor later on. While the other driver may seem remorseful and ready to accept responsibility at the scene, that may change later. Having a police report documents who said what. A police crash report can also document the identities of passengers in your vehicle, the other vehicle and also witnesses who remained at the scene.

Particularly in Houston, the fourth largest city in the United States, police departments are kept very busy and often stretched pretty thin. The prospect of having to wait an hour or more in Houston heat for an officer to respond and make a report may seem miserable, but when compared to the misery of fighting the other guy’s insurance company because there is a dispute about how the accident happened, waiting for a police officer is an hour well spent.

Remember that the officer has up to 10-days from the date of the accident to finalize the crash report and submit it to his/her department. You should do everything you can to get the other driver’s insurance information before you leave the scene, either by asking the other driver for it or asking the police officer to give it to you. Sometimes police officers will tell people that the other driver’s insurance information is in the report: while that may be true, you may have to wait 10-days to get it.

Sec. 550.062.  OFFICER’S ACCIDENT REPORT.  (a)  A law enforcement officer who in the regular course of duty investigates a motor vehicle accident shall make a written report of the accident if the accident resulted in injury to or the death of a person or damage to the property of any one person to the apparent extent of $1,000 or more.

(b)  The report required by Subsection (a) must be filed with the department not later than the 10th day after the date of the accident.

(c)  This section applies without regard to whether the officer investigates the accident at the location of the accident and immediately after the accident or afterwards by interviewing those involved in the accident or witnesses to the accident.

Why the other guy’s insurance company won’t provide you with a rental car immediately after an accident.

13
Jul 2011
By:

One morning on the way to work you are rear-ended while waiting at a red light.  You are hurt and your car is badly damaged.  Your car was not safe to drive and has been towed to a storage lot.  The driver who rear-ended you apologized at the scene and told you she was at fault.  The police officer who investigated the accident issued the driver who hit you a ticket for rear-ending you and told you the other driver is at fault.

That afternoon you called the other driver’s insurance company and set up a claim.  They said they cannot provide you with a rental car right away.  The accident was clearly the fault of their insured, so why no rental car? You’re without your car through no fault of your own and you are frustrated…is the insurance company giving you the run-around?

The answer is that they are probably not giving you the run around.  Before an insurance company will accept liability for a claim and start doing things that cost them money (like providing you with a rental car), they will want to investigate the claim.  At a minimum they will want to speak to their driver and ask them how the accident happened.  The insurance company will also want to verify coverage, by making sure that their driver’s insurance policy was in effect on the date of the accident and that the person driving was a covered driver under the policy.

Even the most efficient insurance companies typically cannot complete an investigation within hours of a car accident, for example: they may have trouble reaching their insured to get their version of events.  While you have called and reported the claim, and you may have provided your version of how the accident happened which is completely correct and truthful, the insurance company will not make a decision to part with their money based ONLY on your version of what happened.

It is frustrating to suddenly be without your vehicle due to someone else’s carelessness and you have ever right to feel frustrated. But…think of it this way: if you got a bill in the mail from someone you didn’t know saying you owe them $1,000 and you need to mail them a check, you would want to know why they think you owe them money.  You wouldn’t just assume you owe them money because they say so and mail out the check.  You would try to figure out if you really owed the money before you paid.

Try to be patient. Even if you are frustrated, don’t take it out on the insurance adjuster.  There is an old saying: “You catch more flies with honey than you do with vinegar.”  Adjusters are people too, and they are more likely to help out people who are patient and polite than people who scream at them or behave unreasonably.

If you have been injured as a result of a motor vehicle accident, typically the earlier you get sound legal advice, the better. For example, Smith & Hassler strongly recommends you do not give a recorded statement to the other driver’s insurance company.  You can call Smith & Hassler for a free consultation regarding your motor vehicle accident claim and speak directly to our attorneys.  We can help you by talking you through the process and helping you understand what to expect.

Health insurance and Texas personal injury lawsuits after Haygood v Escabedo

Last week the Texas Supreme Court issued an opinion in the case Aaron Glenn Haygood v Margarita Garza De Escabedo that will have a profound effect on many personal injury lawsuits in Texas.  The opinion is available online here. Before we discuss the Escabedo opinion, here is a little background to set the stage…

In 2003 the Texas legislature, as part of a sweeping round of tort reform, enacted a new statute: section 41.0105 of the Texas Civil Practice & Remedies Code. The statute reads as follows: “In addition to any other limitation under law, recovery of medical or health care expenses incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.” Since taking effect September 1, 2003 that one sentence long statute has caused all manner of confusion in the area of personal injury litigation in Texas.

The way the statute came to be interpreted by the majority of Texas courts was that in a personal injury lawsuit where the injured person’s medical bills were paid (in whole or in part) by health insurance, the defendant who caused the plaintiff’s injury was only required to pay the plaintiff the amount paid by health insurance, plus any co-pays and outstanding balance, and was NOT required to pay the plaintiff the amount the plaintiff was billed by her medical provider.  Here are two examples:

Scenario A, prior to CPRC Sec. 41.0105 being enacted: Dan Defendant rear-ends Paul Plaintiff at a red light. Paul goes to the hospital for treatment and the hospital bills Paul $1,000. Paul has private health insurance. The health insurance company pays the hospital $500. Paul has a co-pay of $100. The remaining $400 of Paul’s bill is written-off by the hospital as a discount to Paul’s health insurer, who has a pre-negotiated rate with the hospital. Dan owes Paul the $1,000 that the hospital billed Paul. If Paul has to repay his health insurer the $500 they paid on his behalf (as commonly happens), and Paul is reimbursed the $100 co-pay he paid, then there is a $400 upside. That upside goes to Paul.  Prior to CPRC 41.0105 the reasoning was, if an upside should go to anyone it should go to the injured plaintiff, rather than allowing the negligent defendant to benefit from the plaintiff’s private health insurance.

Scenario B, after CPRC Sec. 41.0105 was enacted: Dan Defendant rear-ends Paul Plaintiff at a red light. Paul goes to the hospital for treatment and the hospital bills Paul $1,000. Paul has private health insurance. The health insurance company pays the hospital $500. Paul has a co-pay of $100. The remaining $400 of Paul’s bill is written-off by the hospital as a discount to Paul’s health insurer, who has a pre-negotiated rate with the hospital. Dan owes Paul $600: the $500 paid by Paul’s health insurance company plus Paul’s $100 co-pay. After CPRC 41.0105 was enacted the ultimate effect of the statute was to allow a defendant to benefit financially from having the good fortune to hit a Plaintiff who had private health insurance.

So….CPRC 41.0105 (often referred to as “paid versus incurred”) limited the amount of money a plaintiff could recover for past medical bills when the plaintiff’s health insurance paid their bills. But: did the statute limit what evidence of medical bills the plaintiff could present to the jury? Could the plaintiff present the jury evidence of the full amount the hospital billed, or could the plaintiff only present the jury with the amount paid by health insurance, plus co-pays and balances owed? Prior to the Texas Supreme Court issuing the Escabedo decision last week, the answer was “We’re not sure.”  After the Escabedo decision, the answer is: a plaintiff may only present a jury with the amount paid by health insurance, plus co-pays, plus balances owed, and MAY NOT present the jury with evidence of the amount that was originally billed by the hospital (or other medical provider).

Prior to Escabedo what most civil trial judges in Texas did was to allow the plaintiff to present the jury with evidence of the full amount billed by medical providers, and if the jury awarded the past medical bills in full, the defendant could make a motion with the court post-verdict to reduce the award of past medicals to the amount paid by health insurance, plus co-pays, plus balances owed. After Escabedo however, personal injury Plaintiffs must now redact their medical bills to remove evidence of the full amount charged by the medical provider, and also (presumably) remove evidence of any health insurance write-offs or discounts.

If you have followed along this far you may be thinking: so what? If all the plaintiff can recover is the amount paid by health insurance, plus co-pays, plus balances owed, what does it matter if that is all the jury hears evidence of?  Well it actually does matter, and here’s why.  Firstly Escabedo sets up a bizarre situation where two plaintiffs sitting next to one another in the back seat of a car rear-ended by a defendant get to put on significantly different evidence of past medical expenses at trial if one plaintiff has health insurance and the other does not. Here’s an example to illustrate:

Plaintiff Alpha is sitting in the right hand side rear seat of a car. Dan Defendant rear-ends the car. Plaintiff Alpha is taken to Memorial Hermann who bills Plaintiff Alpha $1,000 for their services.  Alpha has health insurance with Blue Cross Blue Shield.  BCBS pays Memorial Hermann $400. Alpha has a $150 co-pay. The remaining $450 is written off by Memorial Hermann as an HMO discount per Memorial’s agreement with BCBS. Alpha gets to present the jury with evidence of $550 of past medical bills at trial.

Plaintiff Bravo is sitting in the left hand side rear seat of the same car. Dan Defendant rear-ends the car. Plaintiff Bravo is taken to Memorial Hermann who bills Plaintiff Bravo $1,000 for their services; by coincidence Bravo gets the very same treatment and diagnostic tests Alpha gets.  Bravo has no private health insurance so his bill remains unpaid until the lawsuit over the car accident goes to trial. Alpha gets to present the jury with evidence of $1,000 of past medical bills.

Same accident, same hospital, same treatment, same original billed amount, same jury, same trial, but Alpha and Bravo get to present different evidence of damages for past medical expenses to the jury. When it comes to presenting evidence of past medical bills, the Escabedo decision creates two classes of Plaintiffs: those with health insurance and those without.

Here is another reason this matters: rightly or wrongly, juries are known to use the amount of a personal injury plaintiff’s medical expenses as an index or guide when trying to decide how much to award for “general damages.”  General damages include what are commonly referred to as “pain and suffering” damages, which would include physical pain, mental anguish, physical impairment and disfigurement.

Say a personal injury plaintiff sustained a severe back injury after being rear-ended by an overloaded 18-wheeler and had to have a lumbar fusion procedure. Factoring in the cost of hospital admission, anesthesia, hardware and surgeon’s fees, a major procedure such as a lumbar fusion can routinely cost in excess of $100,000.  However, due to pre-negotiated rates health insurers have with hospitals, surgeons, anesthesiologists and other medical providers, the amount ultimately paid for a $100,000 back surgery, factoring in patient co-pays and the amount paid by health insurance, may be closer to $30,000.

If a jury is presented with $100,000 or more in past medical bills for a plaintiff who had a major back surgery and whose spine will never, ever be the same again, and who cannot pursue the hobbies or family activities he or she once enjoyed pain-free, it is a less daunting task to ask that jury to award $100,000 for pain and suffering than if the jury heard evidence of $30,000 in past medical bills.

If the jury heard evidence of the $100,000 the plaintiff was billed by his doctors for the back surgery (as the jury would have pre-Escabedo) an award of $100,000 for pain and suffering would be an award that was the same amount as the past medical bills. If on the other hand the jury heard evidence of $30,000 in past medical bills (as the jury will after Escabedo) an award of $100,000 for pain and suffering would be more than three times the amount of past medical bills (at least, that’s how it would appear to the jury).

Escabedo was a 7-2 decision by the Texas Supreme Court.  The opinion was written by Justice Nathan Hecht and upends long-standing Texas jurisprudence that a negligent defendant who injures a plaintiff should not benefit from that plaintiff’s private health insurance.  Escabedo is a big win for liability insurance companies in Texas and it will undoubtedly save them millions of dollars annually that would otherwise have gone to injured Texans and their families.

So if a drunk driver slams into you and your family late one night in Houston and you’re rushed to the hospital, go ahead and turn over your health insurance card as soon as you get to the emergency room. Just think about all the money you can save the drunk driver or his insurance company, not just on past medical bills, but also on your pain and suffering damages at trial when the jury is presented with evidence of a fraction of the amount the hospital charged to treat you and your family.

Photographing damage to your vehicle for a personal injury claim

Smith & Hassler has previously posted to this blog about the importance of photographing your injuries for a personal injury claim. This post discusses photographing damage to your vehicle and how property damage photographs may be useful evidence in presenting an injury claim to an insurance company.

Generally speaking insurance companies think in a linear way when it comes to the interaction of property damage and injury claims. The worse the damage to your vehicle, the more likely an insurance company is to believe you that you were injured and need medical treatment (assuming you do not have an obvious or objective injury, such as a laceration or broken bone). On the flip side, if there is very little damage to your vehicle, an insurance company will question whether you were injured at all.  In fact it has routinely been our experience at Smith & Hassler that shortly after an injury claim is set up, insurance companies mail us photographs of our client’s vehicle showing minor damage with a letter enclosed stating that due to the minor damage, the insurance company expects that there would be very minor injuries and very little medical treatment.  State Farm Insurance particularly likes to mail minor property damage photographs.

The reality is that while there is a relationship between property damage and the likelihood of injury, the relationship is not simple or straightforward. Different types of vehicles react differently to collisions.  For example: you would expect to see different types and amounts of damage to the back of a Honda Civic than you would a Chevrolet Suburban: the vehicles are made of different materials, have different ground clearances and bumper heights and weigh different amounts.

Another example is when one full-size pickup truck rear-ends another full-size pickup truck. Texas is “truck country” after all, so at Smith & Hassler we see a lot rear-end automobile accidents involving pickup trucks. Because of the way pickup trucks are constructed many makes and models can weather a hard rear-end collision yet show very little damage for it, often not much more than a somewhat bent-down rear bumper.

There is also the fact that people react differently to impact forces. A person who has had decades of neck pain and a prior neck surgery may suffer significant pain and injury from an apparently quite mild rear-end collision, whereas the person sitting next to them who has never had neck pain may experience no injury at all.

Still: insurance companies know that photographs showing minor damage to the injured person’s vehicle can create problems if the injury claim winds up in front of a jury. Insurance defense attorneys use the photographs to characterize the accident as extremely minor…barely a tap…not the type of accident that could cause a person injury.

Some insurance companies, most notably Allstate Insurance, make a special effort to take plenty of photographs of an injured person’s vehicle that has little damage.  They will keep the photographs in their file and seek to introduce them as evidence if a lawsuit is filed on the claim. However: they go out of their way NOT to take photographs of an injured person’s vehicle that has been badly wrecked. They don’t want to take photographs of a badly wrecked car because they would be required to produce those photographs to the injured person’s attorney if a lawsuit is filed, and they know the photographs will help the injured person at trial. There is no guarantee that a judge will allow photographs of the vehicles into evidence at trial, but many many insurance companies try to skew the evidence in their favor from the beginning.

Before you take photographs of the damage to your vehicle you should keep in mind that if your injury claim goes into litigation (in other words, you hire an attorney and a lawsuit is filed over your injuries), the photographs will have to be produced to the insurance defense attorney if they request them (and they always do request them).   If there was severe damage to your vehicle you should take lots of good quality photographs from multiple angles showing the extent of the damage.  Here are a few bullet point suggestions:

  1. Take plenty of photographs.  Digital photographs are free to take and easy to store on a computer, so it costs you the same to take 50 pictures as it does to take 5 pictures.
  2. If the airbags in your vehicle deployed, take some interior photographs showing the airbags were deployed.
  3. Look for “transferred damage” and photograph it. Transferred damage is damage to your vehicle that was not the result of a direct impact to the damaged area, for example: in a severe rear-end collision the rear roof pillars or the roof itself may become buckled from the force of the impact.
  4. In a rear-end impact, particularly to a a large SUV or full-size pickup truck, look underneath the rear of the vehicle because bumper mounting brackets may be buckled or broken.  Take photographs.
  5. In a rear-end collision involving a pickup truck, check to see if the bed of the pickup truck was pushed forward and damaged the rear of the cab. An example of this type of damage is inserted below.
  6. Don’t just leave the photographs on your camera and assume they will be safe.  What if you lose your camera or there is a problem with the memory card?  Transfer your photographs to your PC or laptop and think about uploading them to a web site that hosts pictures for free, such as www.kodakgallery.com or www.photobucket.com – make sure that the photographs are private and not available to just anyone.
  7. Don’t put the photographs on your Facebook or MySpace page! If you post the property damage photographs to a social networking web site and your injury claim goes into litigation, you open the possibility of the insurance defense attorney being able to get discovery of your Facebook page because you posted information related to the car accident.

This photograph is an example of damage from a rear-end collision to a pickup truck where the truck bed was pushed forward into the cab.

If you, a friend or a family member have been injured in a car accident, Smith & Hassler’s experienced personal injury attorneys are available to give you a free consultation either in-person or by phone.  Sometimes people injured in car accident wait before consulting an attorney. They have good intentions: not wanting to seem “sue happy,” waiting to see if their injuries will get better or because an insurance adjuster is discouraging them from seeking legal advice (that happens).  It is better to know your rights early in the process and have an experienced Houston personal injury attorney explain the steps involved in car accident injury claim and what you can do NOW to increase the chances of a good outcome.

Health insurance and your medical bills from a car accident

Those among us fortunate enough to have health insurance, but unfortunate in being injured in a car accident, may wonder what happens to their medical bills. Put another way: can you recover money for medical bills paid by health insurance in a settlement with the other driver’s automobile insurer? The answer is yes, with a few buts.

In 2003 the Texas legislature enacted House Bill 4 (HB4) which included sweeping tort reform that had significant effects on personal injury law, particularly medical malpractice. Enacted when HB4 was passed was Texas Civil Practice & Remedies Code Section 41.0105 (CPRC 41.0105), which has become known as the “paid versus incurred” statute. The exact wording of the statute is as follows:

§ 41.0105. EVIDENCE RELATING TO AMOUNT OF ECONOMIC DAMAGES. In addition to any other limitation under law, recovery of medical or health care expenses incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.

Here is a simple example to show how this statute has changed the recovery of money damages for medical bills in Texas when the injured person has health insurance. Let’s say you are rear-ended in a car accident and have a $10,000 hospital bill as a result. Your have health insurance with, let’s say, Blue Cross Blue Shield, and after a $200 co-pay your health insurance pays the hospital $4,800 and the remaining $5,000 of the bill is written off as a “provider discount” to BCBS.

Prior to HB4 and CPRC 41.0105, if you made a claim under the other driver’s automobile insurance for your medical bills, the other driver’s insurance would reimburse you $10,000 which is the full amount of your hospital bill. Put another way, the automobile insurer of the at-fault driver would not get the benefit of your private health insurance. When the law operated this way the $5,000 “upside” would go to you, the injured person: the most you would have to reimburse your health insurer would be the $4,800 BCBS paid the hospital and you would get to keep the $5,000 difference.

Here’s how that changed after HB4 and CPRC 41.0105: the most you can recover from the other driver’s automobile insurance is $5,000 which is the $200 co-pay you paid and the $4,800 paid by BCBS. The automobile insurance company for the at-fault driver gets the benefit of the $5,000 provider discount (or “write-off”) the hospital extended to BCBS.

The overwhelming majority of plaintiffs’ personal injury attorneys think CPRC 41.0105 is being applied in an unfair way and the statute should be changed or repealed. Health insurance is not free. In our example, the driver who rear-ended you did not help you pay your health insurance premiums yet his automobile insurer is getting the benefit of the write-down of the hospital bill which is only being given because of your health insurance.

Something else to consider is that while you can recover money from the at-fault driver’s auto insurer for medical bills paid by your health insurance, your health insurance company may want their money back. This is a process known as subrogation, and most health insurance contracts have subrogation language that says in essence that if they pay your medical bills due to an accident, and you get a recovery from the person who caused the car accident (or their insurer), then your health insurance company is entitled to be reimbursed out of the settlement proceeds. Usually health insurers (or entities acting on their behalf, such as Benefits Recoveries, Inc. or Rawlings Company) will send the injured person a questionnaire shortly after an accident asking if you were injured due to another person’s fault, and if so, to provide that person’s insurance information (claim number, etc).  The health insurer wants that information so they can notify the at-fault driver’s automobile insurer that the health insurer has a subrogation interest (or “lien”) that needs to be paid out of the injury settlement.

There are many other considerations that go beyond the scope of this basic introduction to recovery of medical bills paid by health insurance in a car accident, including negotiating health insurance company liens and presentation of evidence of medical bills at trial that were paid by health insurance. Having an experienced personal injury attorney who recognizes and understands these issues can be a valuable asset and make a significant difference to how much money the injured person puts in their pocket at the end of an auto accident injury claim. Call the Houston personal injury attorneys at Smith & Hassler if you have been injured in a car accident and have questions about your medical bills paid by health insurance.

16-year old Houston girl died due to accidental shooting, not drive-by

A 16-year old Houston girl who died after a shooting incident did so as a result of an accidental shooting by her boyfriend, not due to a drive-by shooting as police were originally lead to believe. The group of 13 to 17-year old kids present when Waddionne Griffin was shot had told police that a dark-colored vehicle pulled up and fired a shot as the teens were standing outside a house in the 4900 block of Alvin at around 12:55AM, said Houston Police Department homicide detective Fil Waters.

After further questioning one of the teens admitted to police that a member of the group had brought the gun to show off and it had accidentally discharged, hitting Griffin. Apparently the 16-year old, known as “Yannie” to her friends, asked her boyfriend who brought the gun to give it to her so she could put it away somewhere safe and make sure nobody gets hurt. The boy, who had no prior experience with firearms, tried to disarm the gun before handing it to her. Unfortunately as he was doing so the gun went off and a round struck Griffin in the arm, going through her chest and then her back. Tragically she died at Memorial Hermann Hospital – The Medical Center.

Charges of negligent homicide are expected against Griffin’s boyfriend, who is a juvenile. The boy’s parents were home at the time of the shooting but were asleep, and have said they do not allow guns in their home. Griffin’s boyfriend wrote an apology letter to the family and asked investigators to deliver it to them.

In Ms. Griffin’s tragic case, it appears only her boyfriend’s negligent actions led up to the shooting incident, and the boyfriend’s parents had no knowledge of the gun. Smith & Hassler‘s Houston personal injury attorneys have handled other somewhat similar cases in which injury or death claims have been made under homeowner’s insurance policies. In order for a homeowner’s insurance policy to cover injury or death resulting from a shooting incident, the homeowner has to have committed a negligent act that caused or contributed to the injury or death. For example: if a parent knowingly allowed two 8-year olds to shoot a BB gun in the backyard unsupervised, and one 8-year old shot the other in the eye, the incident would probably be covered under the parent’s homeowner’s policy because it would be an act of negligence to allow two 8-year olds to use a potentially deadly BB gun without adult supervision.

If you have been injured due to the negligence of a homeowner, call the experienced Houston personal injury and wrongful death attorneys at Smith & Hassler for a free consultation regarding your case.

Insurance company won’t honor $50,000 donation to charity after incredible hockey shot

Hockey fan Richard Marsh accepted a challenge to shoot a puck the length of the ice rink and through a tiny hole in a cardboard cut out placed over the goal at the Pepsi Coliseum in Indianapolis, Indiana. Before he took his shot Mr. Marsh very generously decided to donate the $50,000 prize to St. Vincent’s Cardiovascular and the American Heart Association. He took his shot and, incredibly, the puck traveled the length of the ice and passed through the tiny hole. The event was sponsored by Allstate Insurance Company.

Incredibly, a third party insurance company later voided Mr. Marsh’s shot because he was standing the wrong side of the line when he pushed the puck. The insurance company said Mr. Marsh was “standing in the wrong place.” As you can see from the video below, Mr. Marsh was a few feet past the goal line when he took his shot the length of the ice rink. The owner of the Indiana Ice hockey team Paul and Cindy Skjodt later made an unsolicited donation in recognition of Mr. Marsh’s incredible feat.

Go figure that an insurance company would refuse a charitable donation to some very worthy causes over a totally meaningless technicality. Disgraceful.