Medical Payments Coverage, or ‘Med Pay’, is often used to cover medical bills after a car accident in Illinois. It is an optional coverage that every driver should have on their car insurance policy. Med Pay coverage is not required in Illinois but it is a good idea. Med Pay pays the medical bills of a driver and their passengers following a car accident, regardless of fault, up to the coverage limits of your policy. Med Pay coverage does not have copays or deductibles. It is easy to use and allows for your bills to get paid quickly.
Given skyrocketing health care costs, it is best to have as many payment options as possible available after being injured in a car accident. Each source of insurance has its own advantages and its own set of rules. Med Pay is just one of the options that you should have available in case you need it.
Your lawyer should evaluate what is available to you, offering guidance in the complex web of getting the bills paid after your accident. Unlike everyone else who tries to tell you how to pay the medical bills, your lawyer’s only interest will be what is best for you. Watch out for the agendas of billing offices and adjusters who want the bills handled in a particular way. You need to understand Medical Payments Coverage, along with other options that might be available after an Illinois car accident.
What is Med Pay?
Simply put, Med Pay is a way of making sure that medical bills are paid after a car accident. Medical bills are submitted for payment to your own car insurance company. Medical payments coverage can be used in the following situations:
- Minor accidents when it is not worth the hassle of suing the other driver or dealing with their insurance company
- An accident that was your fault
- When you do not have health insurance
- Accidents with a driver who didn’t have insurance (though Uninsured Motorist Coverage will likely provide you much more coverage, in the long term)
- Hit and Runs Accidents
- While waiting for a claim or lawsuit against the at-fault driver to be resolved
Using Med Pay Coverage While a Claim is Pending Against the At-Fault Driver
Here is an example of how Med Pay might work if you are hurt in a car accident that was not your fault. Let’s say that your car is hit in the intersection when another driver goes through a red light. You incur $20,000.00 worth of medical bills, between the hospital and doctors. You submit the bills through your health insurance first. Between deductibles, co-pays or uncovered services, you are still left with $10,000.00 worth of out-of-pocket expenses. If your Med Pay coverage has a $10,000.00 limit, all of your bills can now be paid, even though it was the other driver’s fault. Unfortunately, many Med Pay policies only provide for $5,000.00 limits, in which case you would still be left with a $5,000.00 bill. This is still better than having to deal with a $10,000.00 bill. Meanwhile, you have filed a claim against the other driver and eventually, you recover enough money to cover the medical services you received, in addition to other damages. Med Pay is then reimbursed.
Med Pay can come with a “catch”, called subrogation rights. This means that once you ultimately ‘win money back’ from the other driver’s insurance company, Med Pay has to be paid back. This does not mean that you should not use it. It makes sense that Med Pay would be reimbursed if you succeed against the driver who hit you, otherwise, you would be ‘double-dipping’. Think of Med Pay as a temporary loan against future recovery against the other driver. If you can’t collect from the other driver, your medical bills are still paid and you do not have to repay Med Pay.
Remember, Med Pay can be used for your passengers, too. If you are hurt as a passenger in someone else’s car, find out if Med Pay can help. Pedestrians should also be covered, as with cyclists. This is something that most people don’t realize.
Why use Med Pay if the accident wasn’t my fault?
You file a claim against the other driver’s insurance company and wait for them to pay. After all, the other driver ran a red light, you were hurt, and have medical bills to prove it. So why not just send the bills along to the other driver’s insurance company and ask them to pay? Not so fast. The other driver’s insurance company will not cover medical bills as they come due. It could be years before they pay even a dime related to the accident unless you are willing to take a quick (and often, very unfair) settlement. Med Pay is a way to keep the bill collectors off your back in the meantime. In other words, Med Pay is helpful in terms of timing, quickly paying your medical providers up to the limits of your policy.
There is no penalty for using Med Pay
Injury victims sometimes worry about using their medical payment coverage after a car accident. Usually, there should be no cause for concern.
Common worries include:
- Using Med Pay is not fair
- Insurance rates will go up
- A lower settlement with the other driver
- Being blamed for causing the accident
- Paying your insurance company back for using MedPay
Med Pay is not about Fairness
Being hurt after a car accident that was not your fault will make you angry, and rightly so. The other driver or their insurance should pay, not you. Yes and No. Ultimately, the goal of any personal injury claim is to hold the at-fault driver financially responsible for your medical costs. This process can take months if not years. Med Pay is not an ‘either-or’ situation, where medical bills are either paid by Med Pay or by the other driver’s insurance. Med Pay comes first in the timeline of your personal injury case, if you use it. As a policyholder, you paid for this coverage and might as well use it. The other driver and their insurance company couldn’t care less if you use Med Pay or not. It has nothing to do with them and in no way gives the at-fault driver any advantage. What is not fair is to have your credit ruined or bill collectors calling you looking for payment on medical bills for an accident that you did not cause. Medical Payments coverage protects against bill collectors. Medical Payments Coverage can make things more fair for you in a sense. If you are still uncomfortable using Med Pay and do not want your passengers using it, you should cancel this coverage immediately. Why pay for something that you are not going to use? I recommend to most of my clients that they use their Med Pay. It is a nice protection to have.
Insurance Rates should not go up because of Med Pay
Insurance companies love to raise rates. If an accident was your fault and there was a payout to the people who you injured, your insurance rates can go up. This is understandable because you are now a higher risk. At least, this is how the insurance company will justify the higher rates. Med Pay has nothing to do with fault. You can and should use it even when another driver is responsible for causing an accident. Just because you use your insurance coverage for something does not mean that your rates will be raised. Insurance rates are going to go up anyway simply because it is time to renew coverage. Insurance companies will not give you a reason for raising rates, they just do it because they can. Insurance companies have taken a big hit in recent years with the increase in damage claims to homes (hurricanes, fires, etc). Raising rates for everyone helps the insurance companies’ bottom line. When your rates go up, it is probably not because you used Med Pay for an accident that you did not cause.
Med Pay will not lower your Settlement Amount
Using Med Pay does not affect the amount that you will ultimately recover from the other driver. In other words, the other driver does not get a credit for bills covered by your Med Pay. You can recover for all measures of damages available under Illinois law. The medical expense part of your damages is based on the full amount of medical bills, not just the unpaid portion.
Using Med Pay does not mean you’re at fault
Since Med Pay is based on having been involved in an accident, that alone is the criteria for payment of the related medical bills. While your insurance company will ask about the basic facts of the accident, they are not using fault as a basis for either approving or denying medical bills. It is irrelevant.
Paying Med Pay back is not a reason not to use it
You are not repaying your insurance company for Medical Payments unless you were successful in your claim against the other driver. if you decide to use Med Pay and do not file a claim against the other driver, Med Pay will not look to you for repayment of the bill. They might decide to go after the other driver’s insurance company to get paid back. If you do file a claim or lawsuit against the other driver, there should be enough money to repay MedPay. Part of my job, as an Illinois personal injury lawyer, is often to negotiate with your insurance company for a reduction of the amount that you need to pay back for Med Pay at the end of your case. This scenario does not always apply, but repaying Med Pay should not be a concern when deciding whether or not to use it. Similarly, repayment to health insurance does not mean that you should not use your coverage.
Won’t the hospital or doctor’s office wait for payment after an accident?
Even if your doctor or the hospital knows that your medical care was the result of an accident that was not your fault, this does not mean that they have to wait to get paid. Some will agree to wait and will place a lien on your claim against the other driver, but they don’t have to. Others will ask your lawyer for a Letter of Protection, to ensure that they get paid at the end of the case. Like a medical lien, treating on a letter of protection is also an option for the medical provider.
Medical providers can demand immediate payment from you without having to sit around and wait for a legal process to be over. If a medical provider knows that you have MedPay, they may be more willing to provide care, especially if you don’t have health insurance. Med Pay, assuming that there is enough coverage on your policy, can alleviate the stress of having to tell your doctor that it will be a while before they can be paid. Many medical facilities do send people into collections for unpaid medical bills. It is nothing personal but is a matter of business.
Legal Advantage to Paid Bills in Illinois
Under Illinois law, paid medical bills have an advantage if your personal injury case goes to trial. Medical bills have to be both reasonable and necessary in your court case. Bills that have already been paid are presumed to be reasonable, without additional proof being necessary. Trials are complex and the way that bills come into evidence is easier if the bill has been paid. This is one more good reason to use Med Pay.
It is a good feeling to know that your medical bills have been paid.
Understanding your Insurance Coverage
Not everyone has Medical Payments coverage. The declarations page of your car insurance policy will indicate if you have it, and to what amount. This is a cover page listing what your policy covers and how much coverage you have per category. Or, call your insurance agent to ask if you have Med Pay. If you do not have it, consider adding it. While it will not help you for an accident that you already had, it is peace of mind if you have another accident later on. Don’t wait until after you have been in an accident to buy Med Pay coverage or increase your limits. You will be stuck with whatever is in place at the time of the accident, which is rarely enough. Med Pay coverage is not very expensive and is a nice cushion to have in case you ever need it. People do not regret having enough car insurance, especially after an accident.
Med Pay is especially important to have if you are not covered by health insurance. Even if you do have health insurance, Med Pay is a great idea for most people in Illinois. Many health insurance plans won’t cover chiropractors, but most Illinois Med Pay plans will. Your health insurance is not going to cover your passengers, whereas Med Pay will. Even with health insurance, there are often deductibles and copays to worry about. Health insurance should still be used in most cases, especially for emergency room bills. Med Pay can be used along with health insurance.
Med Pay coverage may not be enough, especially if you are involved in a serious accident. It is a good idea to look into increasing your limits, especially if you don’t have a lot of money in savings to cover an unexpected accident (and aren’t accidents always unexpected?) Many people in Illinois only have $5,000.00 worth of coverage, which doesn’t even begin to cover the Emergency Room bill in many cases, especially when X-rays or other diagnostic tests are performed.
A personal injury lawyer can help
Navigating Med Pay and other insurance after a car accident can be a giant headache. Depending on the severity of your injuries, it might make sense to seek out legal help- especially if you are juggling many bills from several different healthcare providers.
We give all of our clients a handbook that explains various options for handling medical bills. One of the first things we do for our clients is to review their own insurance policies, to help them understand their coverage. There is no one-size-fits-all answer about how to best handle medical bills after an accident. We help our clients understand their unique options.
If you have been in a serious car accident in IL and are unsure about how to pay your medical bills, give us a call. We are located in both Elgin and Schaumburg, helping car accident injury victims throughout the Chicago area.