“Fair Share” Subrogation Becomes Law
One of the many issues facing a person injured in an automobile accident is the medical bills associated with treatment for their injuries. Most people have health insurance which will generally cover medical treatment. However, most people do not know that if they receive any compensation from the person at fault in the accident, their health insurance provider has a right of subrogation or reimbursement for the medical bills they paid. In its simplest terms, this means the health insurance provider is entitled to recover what they paid out for medical care from their insured (the injured person).
Subrogation has greatly complicated settlement of personal injury claims because it is another entity with their “hand out” looking to get part of the money. This is especially so as more and more insurance companies make low ball offers in pre-lawsuit settlement negotiations.
Further difficulty is encountered when fault for the accident isn’t totally clear. In Ohio, and injured person may generally recover as long as they are less than 50% at fault in causing the accident. The amount of recovery is reduced by the percentage the injured person was at fault. For example, if the injured person obtains a judgment for $100,000 against the person primarily causing the accident, but the jury determines the injured person was 30% at fault, they would only recover $70,000. This comparative fault reduction created the issue of whether the subrogated medical insurance company should be allowed to collect the total amount of bills they paid on behalf of the injured person despite the reduction?
Ohio recently passed the “Fair Share” law (Ohio Rev. Code § 2323.44) effectively requiring a subrogated medical insurer to reduce the amount of their subrogated interest by the same proportion that the injured person’s claim was reduced due to their percentage of fault in causing the accident. So, in the above example, a medical insurance provider could only collect 70% of what they paid on behalf of the injured person.
This may not seem like a big deal, but when fighting against large insurance corporations who’s only objective is profit, it is nice to see some common sense legislation on behalf of the injured.