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Medicaid Liens & Personal Injury Settlements

medicaid lien personal injury settlement

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During the course of your personal injury case, you may encounter something called a “Medicaid lien.” Medical providers, insurance companies, and various other third parties sometimes try to place a claim on part of your settlement amount. Unfortunately, these Medicaid lien personal injury settlement cases are growing in both frequency and popularity. Lawsuits, especially complicated lawsuits, can last several years. This opens the door for outside entities to attempt to get a portion of your settlement money with these liens.

At Reich & Binstock, we provide all our clients with the right insurance and contract claims lawyer for their Medicaid lien personal injury settlement case. No case is too small or too complex for a good attorney. That’s why we’re here to provide you with one. If you or someone you know had a Medicaid lien placed on their personal injury settlement money, you need the qualified attorneys with Reich & Binstock. For a free case evaluation, please call 713-622-7271 today.

What Part of My Lawsuit Settlement Can Medicaid Take?

Individuals on Medicaid, should they undergo a personal injury settlement, have Medicaid liens placed on their settlement amount. These liens aim to reimburse their state’s Medicaid program for benefits paid to that individual for past medical services. Unfortunately, these liens are mandatory for anyone who has received Medicaid benefits in the past. Notably, the lien does not differentiate what the settlement money goes toward. Rather, the lien is on the entire settlement amount, not on certain portions of the settlement. If someone fails to pay their Medicaid lien, the state has the right to sue both the client and their lawyer for knowingly ignoring this lien. Medicaid always knows if you attempt this, as they require you to notify them of any and all personal injury cases that you undergo. They do this in order to determine whether or not they will place a lien on your settlement amount. 

What is the Medicaid Lien Statute of Limitations?

Right now, you’re probably wondering if Medicaid liens have any limitations whatsoever. Is there a situation where Medicaid can’t take my settlement money? Luckily, a Medicaid lien personal injury settlement recovery has its limitations. While Medicaid does continue to seek a recovery amount from you, you have the ability to negotiate the amounts and payments. Negotiating different lien amounts for your case is an important option, and should be discussed with your attorney. Including Medicaid in your settlement negotiations early on is another way to encourage fair lien payments for yourself. Further, the government must file their complaint within 3 years of receiving notice of the settlement. Failing to do this bars them from recovering the lien amount.

What States Use Medicaid Liens?

Medicaid is a program jointly funded by both the states and the federal government. However, the states themselves generally run the program for those within their own state. Much like Medicare, this service must be paid back by the recipient of the Medicaid benefits. Therefore, potentially all states have the ability to engage in Medicaid lien personal injury settlement recovery. Where each state tends to differ is its exact processes and amount limitations for payments. 

Where are the Medicaid Liens Filed in Texas?

Generally, Medicaid operates out of the Texas Department of Health and Human Services. Medicaid files a claim through the appropriate court for your case, and puts a lien on your settlement amount. In most cases, Medicaid does not recover more from you than it has provided in medical benefits. Once they file their claim in court, they wait along with all other creditors (if you have any) who believe they deserve a portion of your settlement money.

How to Protect Your Home From Medicaid Liens?

If you’re afraid of losing your home to Medicaid liens, fear not. There are many ways in which we can protect your home and property from Medicaid liens. Below, we outline some of the strategies we employ at Reich & Binstock to protect the assets of our clients.

  • Set up a life estate. This is a simple solution appropriate for people in all different situations. It is a form of joint ownership of the property between two or more people. Each person has an ownership interest in the property, but this interest lasts for different periods of time. One person who initially holds the life estate does so for the rest of their life. The other person still has an ownership interest, but does not take possession until the death of the first person.
  • Set up a trust. Another way we protect the home is to transfer it to an irrevocable trust. Thankfully, trusts offer more flexibility than life estates. However, they are a bit more complicated.  Once you put the home into the irrevocable trust, it cannot be taken out. While the house itself can be sold, the proceeds of selling the house must remain in the trust. This offers more protection for the value of the home. Furthermore, trusts have the potential to allow the settlor to exclude up to $250,000 in taxable gain. 

Experienced Houston Medicaid Lien Personal Injury Settlement Lawyer

You just went through a complicated personal injury case, and now Medicaid is trying to take a large portion of your settlement amount. What now? The best option for you is to seek out a qualified, experienced insurance and contract claims attorney in Houston. Why let Medicaid cut into a large portion of your settlement money after you spent all that time and effort trying to get it? At Reich & Binstock, our attorneys work hard to achieve the best outcome for your case. With nearly 30 years of experience under our belts, you can rest assured that you’re getting top-notch legal representation. If you or a loved one went through a lengthy personal injury case, only to have a lien placed on the settlement, you need Reich & Binstock. To schedule your free consultation, please call our office at 713-622-7271 today, or visit us online.

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