If you're making a claim for exposure to asbestos, insurance coverage will probably play into your case in two main ways: via your health insurance or the defendants’ liability insurance. While insurance issues are not likely to delay the progress of your case through the court system, they will affect -- and could potentially slow down -- how your asbestos settlement is processed.
Health Insurance and Asbestos Claims
If you have mesothelioma or any other kind of asbestos-related disease, it’s likely that you have undergone extensive medical treatment, and incurred significant medical bills. Common medical expenses in an asbestos case include:
- examinations and X-rays
- pain medication
- inhalers and oxygen
- surgery, and
If you have health insurance, your out-of-pocket medical expenses might be limited to co-payments and over-the-counter medications, or you might have had treatments or examinations not covered by your insurance.
These medical expenses are part of your damages, whether you paid the costs yourself or your insurance company did. They can be used as proof of the extent of your disease and your monetary losses. (Learn more about personal injury damages.)
However, if your insurance company has made payments for your diagnosis and treatment, the company might put a medical lien on any settlement you receive. That means the insurance company wants to be reimbursed by the defendants for the money the insurance company spent to take care of you. Even though the medical expenses are included in your damages, the actual financial loss was incurred by the insurance company.
There is tremendous variability among insurance plans, among how much hospitals and doctors bill to insurance companies, and what is allowed under state law. A skilled asbestos-mesothelioma attorney will negotiate with the insurance company about the terms of the lien. An asbestos lawsuit will generally include claims for pain and suffering, economic loss, and medical bills. If you are married, there may also be a loss of consortium claim. Also, if you have other health issues not connected to your asbestos-related disease, your attorney will have to keep track of those so that the insurance company does not try to lien those costs as well.
A settlement will generally be a lump sum for the defendant’s share of all your damages, so it’s hard to determine what portion of each settlement should be counted as for medical expenses. If future medical expenses are claimed, your insurance company might be entitled to reimbursement for those too.
You will need to ask your attorney specifically about what a medical lien will look like in your case: how much the lien is, when it is paid, and so on. Your lawyer may need to hold your settlement funds in a trust account while the details of the lien are negotiated.
If you are insured through Medicare, different conditions apply. Under federal law, Medicare does not seek reimbursement or place a lien on your settlements for illness that resulted from exposure to asbestos prior to December 5, 1980. If all your exposure to asbestos took place before that date, you should be able to avoid a Medicare lien.
If, however, your exposure to asbestos includes dates after December 5, 1980, Medicare is entitled to a lien your case. This becomes complicated because asbestos diseases are progressive in nature and arise from multiple exposures, so it’s impossible to say what part of your illness came from exposure before December 5, 1980 and what came from exposure after that date. So your attorney might choose to work with a company that specializes in administering Medicare asbestos liens.
The defendants in your case will also need to know about your Medicare coverage because they are required to report information about asbestos settlements to Medicare directly.
If you are not on Medicare but are receiving Social Security Disability Insurance, or if you have end stage renal disease (kidney failure), Medicare may also be able to place a lien on your settlements.
Defendants’ Liability Insurance in Asbestos Cases
When a defendant makes a settlement in a lawsuit, it is usually paid by the defendant’s insurance company rather than directly by the defendant. (Learn more about the role of insurance in settling an injury claim in general.) However, in an asbestos case some defendants might have no insurance coverage, or might have exhausted the limits of their policies.
In these situations, the defendant might well not have the money to pay the settlement. Your attorney can go back to court to file an Enforcement of Settlement case, but the defendant might be forced into bankruptcy. When an asbestos defendant has filed for bankruptcy, you become a creditor.
If the defendant has numerous asbestos claims against it, the defendant might establish a bankruptcy trust fund and pay claims out of that. These payments will be much smaller than the settlement amounts. If the defendant simply goes bankrupt, then your settlement might be wiped out completely, along with all the other debts the company owes.
If the defendant is insured but has exhausted the policy limit for the year, the settlement check might be delayed or might come in installments. There is little you can do as a client about defendants’ financial and insurance problems, and it is an unfortunate reality that some of the settlements negotiated in an asbestos case might not be paid.