Maryland recognizes subrogation rights of health insurance companies for the amounts they paid for your treatment when you are involved in an accident. Md. Code Ann., Health-Gen. § 19-713.1(d). This means once you recover under your personal injury claim in Maryland, health insurance companies will be able to claim the amounts from that recovery equal to what they paid for your treatment. On a plus side, Maryland laws provide for personal injury protection coverage (PIP) regardless of fault and make it mandatory unless the insured expressly waives that right. Therefore, in most cases Maryland residents involved in a car accident are more likely than not to have a PIP plan which will provide additional coverage for the injuries of a person involved in a car accident. There are several things to consider with Maryland PIP plans:
In Maryland Health Providers Cannot Demand PIP Payment Before Health Insurance Payments
Because health insurances pay the treatment costs to the healthcare providers under discount rates while PIPs are obligated to pay the usual and customary fees for such services, some medical providers improperly demand that a person injured in a car accident first used his/her PIP to pay for the medical bills. Maryland laws prohibit such demands:
MD Code Ann., Health Insurance § 15-104 (d) establishes the following:
Health insurance policies and policies of nonprofit health service plans may not contain a provision that requires personal injury protection benefits under a motor vehicle liability insurance policy to be paid before benefits under the policies. Md. Code Ann., Ins. § 15-104 (d).
MD Code Ann., Property and Casualty Insurance, §19-507(b)(2), allows the insured to elect between health insurance or PIP benefits as the primary source of payment for medical bills incurred as a result of a motor vehicle collision. Under this provision of Maryland Code, a health care provider is required to bill a patient’s health insurance for treatments arising out of a motor vehicle collision even when the patient has PIP benefits through an automobile insurance policy. The law also requires the health insurance carrier to reimburse the insured for such services before exhausting the PIP benefits.
PIP claims must be paid within 30 days after the insurer receives satisfactory proof of claim by the insured, but the PIP claims must be brought by the insured within 12 months after the accident. Md. Code Ann., Ins. § 19-508 (West).
Maryland PIP Does Not Have the Subrogation Rights But Your Health Insurance Plan May Contain Subrogation Provision
PIP does not have subrogation rights which means if you recover under your personal injury claims and also get paid from your PIP, your PIP insurance will not be able to deduct the amounts paid to you under the plan from your recovery of personal injury claims. Md. Code Ann., Ins. § 19-507 (West).
The situation is different when it comes to the subrogation rights of your health insurance. Md. Code Ann., Health-Gen. § 19-713.1(d) reads:
(d) Notwithstanding § 19-701(g)(3) of this subtitle, a contract between a health maintenance organization and its subscribers or a group of subscribers may contain a provision allowing the health maintenance organization to be subrogated to a cause of action that a subscriber has against another person:
(1) To the extent that any actual payments made by the health maintenance organization result from the occurrence that gave rise to the cause of action; or
(2) For a nonprofit health maintenance organization that exclusively contracts with a group of physicians to provide or to arrange for the provision of health care services for its enrollees, for any service provided by the health maintenance organization as a result of the occurrence that gave rise to the cause of action, per the fee schedule established by the nonprofit health maintenance organization. Md. Code Ann., Health-Gen. § 19-713.1 (West).