Who Pays for the Hospital Visit & Medical Bills After a Car Accident?

The timeline for a personal injury lawsuit after a car accident can vary depending on the complexity of the case, the jurisdiction in which the lawsuit is filed, and whether the case goes to trial.

Here is a general outline of the stages and timeframes for a typical personal injury lawsuit:

• Initial consultation and investigation: You consult with an attorney to evaluate your case. The attorney conducts an initial investigation, gathers evidence, and interviews witnesses. This can take about one to two months.
• Filing a lawsuit: Your attorney files a lawsuit by preparing and submitting a complaint to the court. The defendant is served with the complaint, initiating the legal process. This process can take anywhere from two to six months.
• Response from the defendant: The defendant responds to the complaint by filing an answer, admitting or denying fault. This typically takes 20 to 30 days.
• Discovery: Both parties exchange information and evidence through processes. Expert witnesses may also be consulted during this stage. This process may take six to 12 months.
• Negotiations/settlement discussions: Throughout the case, the parties may engage in negotiations and settlement discussions. Settlement can occur at any point before or during the trial.
• Motions and pretrial: Parties may file motions to address legal issues, such as summary judgment motions. Pretrial conferences and hearings may occur to prepare for trial. This generally takes six to 12 months.
• Trial: If a settlement is not reached, your case will likely go to trial. The trial can last a few days to several weeks.
• Verdict and judgment: The court or a jury delivers a verdict. If you win, the court issues a judgment, determining the compensation the defendant must pay.
• Appeal: Either party may choose to appeal the verdict or judgment, extending the timeline further.

Most car insurance injury payouts range from $15,000 to $35,000. However, your settlement will depend on the severity of your injury, your medical expenses, lost wages, and pain and suffering. The amount of fault you contribute to a crash can also influence your settlement.

Many states have comparative negligence laws in place. So, if you contributed 10% of fault to a collision, your settlement amount would be reduced by 10%. Many states use the modified comparative negligence rule, which prohibits you from recovering any damages if the amount of fault you contribute exceeds the allowed threshold. In some states, the threshold is 50% or 51%.

If the driver who hit you doesn’t have insurance, you’ll need to pursue damages from your own insurance company. To do this, you’ll need to have uninsured motorist (UM) coverage, Personal Injury Protection (PIP), or Medical Payments (MedPay). Some states require all drivers to carry UM or PIP. MedPay is optional in most states but is required in Maine and New Hampshire.

UM pays for your medical expenses, lost wages, and property damage after a crash with an uninsured driver. Plus, it covers you if the at-fault driver leaves the crash scene and can’t be identified. In states where UM is optional, you can add it to your policy.

PIP is typically required in no-fault states. This means that you can recover damages from your PIP policy regardless of who caused the car accident. Like UM, you can add PIP to your policy if you live in a state where it’s optional.

If you don’t have PIP, MedPay, or UM, you could turn to your own health insurance policy to cover some of your medical costs. However, health insurance may not pay for all crash-related medical expenses. For example, a co-pay may still apply when you go to the doctor’s office or attend physical therapy appointments.

What states have PIP coverage?

Currently, 31 states don’t offer PIP coverage. Twelve states require all drivers to have it. These states include Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, and Utah. Eleven of these states are considered “no-fault” states. In Michigan, drivers can opt out of PIP if they receive Medicare.

PIP is optional in Arkansas, Kentucky, Maryland, South Dakota, Texas, Virginia, Washington, and the District of Columbia. Pennsylvania requires medical benefits and is a no-fault and choice state.

Many health insurance policies include a provision called subrogation. Subrogation allows your health insurance company to seek reimbursement for medical expenses it paid on your behalf if you later receive a settlement or compensation from a third party.

In some cases, you or your attorney may be able to negotiate with the health insurance company to reduce the amount they are seeking as reimbursement.

State laws vary on the extent to which health insurance companies can pursue subrogation claims. Some states have restrictions on the amount that can be recovered, and others may limit or prohibit subrogation in certain situations.

Anti-subrogation states include Arizona, Connecticut, Kansas, Missouri, New Jersey, New York, North Carolina, and Virginia.

Is a car accident settlement taxable?

In general, car insurance injury payouts aren’t considered taxable income. Instead, these settlements are typically treated as compensation for damages or injuries. Therefore, they’re not subject to federal income tax.

However, there are some exceptions. For example, punitive damages are intended to punish the at-fault party rather than compensate the injured party for their losses. This means they are taxable. When filing your taxes, you must report punitive damages on line 8z of Form 1040, Schedule 1, Additional Income and Adjustments to Income.

If you previously claimed medical expenses related to the car accident as deductions on your tax return and later received a settlement to reimburse those expenses, you might need to adjust your tax return. Consult with a tax professional for further guidance.

Dealing with an insurance claim after a car accident can be frustrating and overwhelming. If you handle your claim alone, you could find yourself at a disadvantage. That’s because insurance companies often use tricks to reduce their payout. That includes giving you a lowball insurance settlement offer in hopes that you’ll accept it. Once you accept a settlement, you won’t be able to pursue additional damages.

With a Law.com Premier Attorney on your side, the insurance companies can’t take advantage of you. An attorney will handle everything from the initial investigation to the final settlement agreement. Plus, Premier Attorneys operate on a contingency fee basis, so you don’t have to pay any upfront fees. To get started, contact a lawyer in your area and schedule a free legal consultation.