What is a Medical Lien – Health Insurance Liens and Car Accident Settlements

Healthcare professional holding clipboard and person in bed

If you’ve been injured in a car accident because of a negligent or reckless driver, you may consider pursuing a liability claim against them. But did you know that your personal health insurer might ask for reimbursement for medical expenses from that liability settlement? In a recent “Know the Law” segment, Grand Rapids car crash lawyer, Tom Sinas, answers the question “what is a medical lien?”, explaining how health insurance liens and car accident settlements work.

What is a Medical Lien?

To understand health insurance liens, you must first understand how personal injury claims work. When a person is injured, their health insurer often pays medical expenses on their behalf. This is true whether the injured person has private, employer-sponsored health insurance, or government-administered health insurance like Medicare and Medicaid. When those insurers pay medical expenses on account of someone’s injury, the insurer sometimes has a lien (also known as a claim for subrogation or reimbursement) from the injured person’s liability settlement. Simply put, this means the health insurer may make a claim for reimbursement from the victim’s settlement.

How Will the New No-Fault Law Impact Health Insurance Liens?

As most everyone knows by now, Michigan’s auto insurance law experienced a significant reform in 2019. Up until this point, health insurance liens didn’t really affect auto accident victims. Under the old no-fault system, auto accident victims looked to their own no-fault insurer to pay for their medical expenses. These medical expense benefits were the responsibility of the no-fault insurer for the duration of the victim’s lifetime. That meant at-fault drivers weren’t responsible for another person’s medical expenses. In addition, a no-fault insurer generally could not assert a lien for medical expenses against the victim’s recovery from the negligent driver.

Importance of Lifetime, Uncoordinated No-Fault Benefits

These fundamental rules will change due to changes in the law. However, people can protect themselves from this situation happening by opting for lifetime (uncapped), uncoordinated no-fault benefits from their no-fault insurer. Uncoordinated medical benefits mean the no-fault insurer must pay for medical expenses even though similar benefits may be payable to the injured person under a health insurance policy. Our firm strongly recommends opting for this coverage when your auto insurance policy renews in the months ahead.


Making Smart Choices: A Summary Guide to Michigan’s New Auto No-Fault Law – understand the options and our best recommendations about no-fault coverage available under Michigan’s new auto insurance law.

Michigan Auto Insurance Changes – What Consumers Need to Know – a four-part series by Tom Sinas and Fox 17 about the changes in no-fault options

Uncoordinated vs. Uncoordinated Medical Expense Benefits