A “hospital lien” is a document filed by a hospital to assert a legal right of recovery against an injured patient’s settlement in order to secure payment for emergency services after an accident. A hospital lien is governed under Chapter 55 of the Texas Property Code. However, in order for a hospital lien to be enforceable, there are certain requirements that must be met.
What is Required for a Valid Hospital Lien?
- 72 hours: The Patient must visit the hopsital within 72 hours of the incident cauisng the injury. If the Patient visits the hopsital after 72 hours has passed, the hopsital lien is not enforceable against the Patient’s settlement proceeds.
- Emergency Hospital Services: The lien only applies to “emergency services.” If a Patient visits the hospital on an non-emergency basis, then the hospital may not enforce a lien.
- Filed with the County Clerk: The lien must be filed with the county clerk in the county where the services were rendered. A lien filed in any other county is unenforceable.
- Prior to Money Being Paid: The lien must be filed before any money is actually paid on the Patient’s settlement. If any money is paid on the Patient’s settlement prior to the lien being filed, then the lien does not attach to those funds.
- Notice Mailed to Patient: Written notice of the lien must be mailed to the Patient within 5 business days of the lien being filed. And the written notice must contain certain required information, language and disclaimers.
- Reasonable Charges: The hospital is limited to only the reasonable, usual and customary charges for services rendered to the Patient. This is not necessarily the same as the amount actually reflected in the hospital’s billing statement.
- Liability Proceeds Only: A lien only applies to the proceeds of a settlement or judgment paid by the parties claimed to be responsible for causing the accident or injury, or their insurance company. It is not enforceable against the proceeds payable to the patient due to first-party benefits such as personal injury protection or uninsured and under-insured motorist coverage.
The “72-Hour” Rule.
In order for a hospital to have a lien against the patient’s settlement, the patient must have been admitted to the hospital wihtin 72 hours after the incident causing the injury. So, if a car accident happened on a Tuesday at 4:00 PM, then the patient must visit the emergency room no later than 4:00 PM, on the following Friday in order for a hospital lien to be enforceable. If the patient enters the emergency room after this 72-hour window, then the hospital may nor assert a lien on the patient’s settlement. So, if you go to the emergency room at 5:00 p.m. on that same Friday, the hospital may not enfore a lien against your settlement.
First 100 Days of Treatment.
A hospital lien only applies to the first 100 days of treatment. So, if you are seriously injured in an accident and are admitted to the hospital for extended care, the lien can only be enforced for the first 100 days of your treatment. The charges for treatment beyond that time period are not included in the lien amount.
Transfer to Another Hospital.
In the event a Patient is transferred to another hospital after being admitted to the initial emergency hospital, the receiving hospital has the right to assert a lien just as the first hospital could. In other words, the rights to assert a lien are transferred to the receiving hospital so long as the initial hospital had the right to assert a lien. However, if the initial hospital did not have the right to file a valid lien, then the receiving hospital also does not have the right to assert a lien.
A receving hospital may file a lien even if the initial hospital does not file one. Additionally, if the initial hospital files a lien and the receiving hopsital does not file one, then the receiving hospital cannot piggy-back onto the initial hospital’s lien. The receiving hospital must file its own lien.
Emergency Services Only.
A hospital may only assert a lien for emergency hospital care. This is usually services rendered in the emergency room. It can also extend to medical care in other departments so long as the care is related to the emergency room admission. This would include servies such as radiology, intensive care (ICU), and surgery.
“Emergency hospital care” is definded in the statute under Section 55.004(a). It means care needed to “evaluate, stabilize, and treat a serious medical problem of recent onset or severity…” which, if left untreated will likely jeapordize the patient’s health or cause serious physical impairment or disfugurement.
The Hospital Must File the Lien in the County Records?
The lien document must be filed with the county clerk in of the county in which the hospital services were rendered. If it is filed in some other county, then it is not enforceable under the statute. The hospital sends the lien document to the county clerk who then indexes it in the property deed records under the patient’s name as well as the hosptial’s name. Once the lien is filed, everyone is on “constructive” notice of the lien even if you do not have actual notice of the lien. Constructive notice operates the same as actual notice even if actual notice is lacking. That is why it is critical that a proper lien search be done prior to settlement of your case.
In most Texas counties, especially more populous counties such as Dallas, Tarrant, and Collin County, online searches may be available. Other rural counties may require more effort to search for a lien or even a visit to the county’s property records department.
When must the lien be filed?
In order for a hospital lien to be enforceable, it must be filed before any money is paid on the patient’s injury case. Sometimes, a hospital may delay filing the lien for several months. If the patient is able to settle their case and collect the settlement funds before the lien is filed, then the lien is not enforceable against the settlement proceeds even if the money is still in the patient’s bank account.
What information is required to be in the lien document?
Name and address of the Patient.
The lien must contain the name and address of the Patient. It is important that the patient’s name be spelled correctly. If the hospital misspells the patient’s name to such an extent that the lien cannot be found or otherwise causes confusion, then it may not be valid and enforceable against the patient’s settlement.
For instance, if the patient’s name is “Robert Smith” and the hospital lists the patient name as “Richard Smith,” then the lien may not be enforceable against Robert Smith’s settlement. This is because doing a name search under “Robert Smith” would not necessarily pull up the name “Richard Smith” in the search results. However, if the hospital simply misspells patient’s name as “Robrt Smith,” then it may still be enforfceable because such a mistake should not cause confusion as to whom the lien applies, especially if all the other information in the lien is correct.
So, it is imperative that a proper search be done in order to indentify any potential mispellings or mistakes which may still make the lien enforceable.
Date of the Accident.
The lien must also include the correct date of the accident causing the injury. If the lien states the incorrect date of the accident, then the lien may not be sufficient to put everyone on notice of the lien. If the patient’s car accident happened on April 3rd and the lien lists the accident date as April 4th, then it might cause confusion as to whom the lien actually applies. In such a case, the lien may be invalid and unenforceable.
Name and Address of the Hospital.
The lien document must include the name and “location” of the hospital claiming the lien. Some hospitals are part of much larger corporate entities. So, just naming the corporate entity and listing their home office would be insufficient. For instance, if the patient is injured in an car accident and taken to “Baylor Scott & White Medical Center – Irving,” then the lien must list this as the actual hospital name and also state the physical address of the hospital. It would not be sufficient to only name “Baylor Scott & White Health” and list the corparate office address in Dallas.
Name of the Responsible Party.
The lien must also list the name of the person allegedly responsible for causing the patient’s acccident or injury, if such person’s identity is known. Most of the time, this information is unknown to the hospital at the time the patient’s visit. But, if it can be shown that the hospital staff knew who the responsible party is, then the hospital must list that person’s name in the lien or else the lien may be deemed unenforceable.
Mail Written Notice of the Lien.
Once the clerk notifies the hospital that the lien is filed, the hospital must mail written notice to the patient. The notice must be sent by “regular mail,” no later than the 5th business day after the hospital receives notice from the county clerk that the lien has been filed. Failure to send written notice may render the lien invalid. Additionally, there are other requirements that must be contained in the written notice.
Lien attaches to the Patient’s legal claim only.
The written notice must state that the lien attaches to the claim that the patient may have against the person causing the accident or injury. This would also include any claim that the patient has pending with the responsible party’s insurance company.
The lien does not attach to the Patient’s real property.
The written notice must also contain a clause stating that the lien does not attach to the patient’s home or other real property. So, the patient does not have to worry that the hospital is going to foreclose on their home since the lien only attaches to the patient’s legal case and settlement proceeds.
Is the hospital bill still valid if I do not settle or collect on my injury case?
Yes. If the hospital files a valid lien and you fail to collect any money on your injury case, the hospital is still entitiled to collect their bill. The hospital lien is just another means of securing and collecting payment of thie bill against the proceeds of any potential settlement. If the patient is unable to collect anything on their injury case and the hospital’s bill remains unpaid, the hospital may take other action to collect directly from the patient, such as credit reporting or filing a lawsuit against the patient.
Do I have to pay the hospital bill in full?
Yes and No. The hospital’s bill must be fully satisfied from the settlement proceeds. But, just becuase the hospital bill states certain charges for their services does not mean that is what they are entitled to collect. The hospital may only enforce the “reasonable, usual and customary charges” for “necessary” services. A hospital is not allowed to seek collection of a hospital lien for charges which exceed the reasonable rate or for unnecessary or excessive treatment.
What is reasonable?
Under Texas law, a hospital is only allowed to collect no more than the “reasonable, usual and customary” charges for its services. “Reasonablness” of a hospital’s charges take into account many factors and is not solely based on the amount the hospital lists on their billing statement. This may provide a patient with valuable ammunition to negotiate the hospital’s bill.
A hospital’s reasonable charges are generally determined by what it normally collects and accepts from other sources, such as health insurance; governmental programs, like Medicare and Medicaid; as well as collections from other uninsured and self-pay patient’s. These amounts tend to be far less than the amount the patient sees on the billing statement.
Health insurance rates.
One common factor in determining what is reasonbale is reference to what the hospital usually collects from private health insurance. When a hospital is in a health insurance companies network, it agrees to accept greatly redcued rates for their services. Likewise, reference to these reduced rates may be used to determine what a hospital may legally collect on a hospital lien.
Medicare and Medicaid.
When a hospital bills governmental health programs, such as Medicare and Medicaid, the amount the hospital actually collects is usually a fraction of the amount reflected in the bill. Likewise, a patient may use these rates to argue that the hospital should grant the same or similar priviledge to the patient and should not be greedy just becuase the patient received a monetary settlement.
Which Proceeds are Applicable to a Hospital Lien?
A hopsital lien in Texas is only applicable to the claims against the parties responsible for causing the injury or their insurnace company. For instrance, if your are invovled in a car accident, then the hospital lien applies to any settlement you reach with the driver or the their insurance company. If the other driver was on the job at the time, then the lien is also enforceable against any settlement you make with the driver’s employer.
However, claims that you make against you own insurance policy are not applicable to a hospital lien. For instance, a lien is not enforceable against the proceeds you receive for Personal Injury Protection (PIP) benefits, or uninsured and under-insured motorist (UM/UIM) benefits. This also true even if these benefits are payable to you because you were in someone else’s vehicle at the time of the accident.
The key factor here is that a hopsital lien only applies to the proceeds of those parties who are alleged to be at fault in causing the accident and injury.
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Hospital liens are just one aspect of a personal injury case that an experienced personal injury attorney works with everyday. Having an attorney on your side in your car accident, trucking accident, or other injury case is pivitol in bringing your claim to a successful conclusion.
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