Under Va. Code § 8.01-66.9, whenever a person sustains personal injuries and receives treatment in any hospital operated by the Commonwealth, the Commonwealth shall have a lien for the total amount due for services rendered on the claim of such injured person against the person who allegedly caused such injuries. The lien attaches to all sources of recovery whether derived from the tortfeasor’s insurance company or the plaintiff’s UM/UIM or medical payments coverage.
When the Commonwealth’s lien constitutes a disproportionate percentage of the plaintiff’s total recovery, Va. Code § 2.2-514, together with Va. Code § 8.01-66.9, permits the Attorney General or his assistant attorneys general to compromise the Commonwealth’s lien.
To request a lien reduction, the personal injury attorney must make the request, in writing, to the Office of the Attorney General, Division of Debt Collection, P.O. Box 610, Richmond, VA 23218-0610. But before you submit a lien reduction request, follow these four tips:
Tip 1: To receive consideration, you must respond to the following items:
- Brief description of your client’s injuries;
- Your client’s social security number and date of birth;
- Your client’s prognosis;
- Future treatment expenses, if any;
- If your client is permanently disabled, the disability rating;
- Your client’s marital status at the time of the accident and treatment;
- The current financial status of your client and his/her spouse, and a list of their joint and individual assets, including all real estate holdings. If your client is a minor, then list this financial information for your client’s parents or guardians;
- Copy of your client’s VCC indigent care award letter, if any;
- Employment status, currently and at the time of the accident;
- A brief description of the accident, the location of the accident, the identities of all parties involved in the accident, whether any parties were charged, and, whether criminal restitution was ordered (send police report and/or restitution order if available);
- Amounts of all other liens and compromises, if any;
- All relevant insurance coverage, including liability, medical reimbursement, underinsured, uninsured, and stacked coverage. For each type of insurance, give the policyholder’s name, the policy limits and the amount paid to your client. If your client accepted less than the policy limits in settlement, give rationale;
- All relevant health insurance coverage, including Medicaid, Medicare, and private insurance, and for each, the amount paid on behalf of your client to each medical provider;
- Firm settlement offer and if structured, terms of settlement;
- Compromise requested of Commonwealth and reason(s) therefor;
- All attorney’s fees and costs, and any proposed reductions (send an itemized statement of attorney’s costs).
Tip 2. Respond in an interrogatory-style fashion.
As a former Assistant Attorney General who reviewed hundreds of these lien compromise requests, I always appreciated the attorneys who responded to the aforesaid requests in an interrogatory-style fashion. That is, state the prompt, then provide the response. Adopting this format reduces errors and omissions, and expedites the review process.
Tip 3. Send copies of all outstanding medical bills, but do not send medical records.
The Attorney General’s Office must calculate the liens held by inferior medical providers under Va. Code § 8.01-66.2 before recommending that the Commonwealth reduce its lien. To determine the lien amounts held by inferior medical providers, the Commonwealth has to review the plaintiff’s outstanding medical bills. Thus, send copies of all outstanding medical bills as part of your lien reduction request. Note: as of the date of this article, medical providers with liens arising under Va. Code § 8.01-66.2 are subject to the following statutory maximums: $2,500 in the case of a hospital or nursing home; $750 for each physician, nurse, physical therapist, or pharmacy; and $200 for each emergency medical services agency. Do not confuse a medical provider’s lien amount with his or her claim amount, which is often times vastly different.
Medical records should not be sent as part of the initial lien compromise request. This documentation impedes the review process and will not be considered.
Tip 4. Engage in good faith negotiations with the Attorney General’s Office prior to filing a petition to reduce lien in the appropriate trial court.
Many lien compromise requests result in a fair settlement between the parties. To reach a reasonable result, however, it is imperative to negotiate with the Attorney General’s Office in good faith. But if good faith negotiations fail between the plaintiff’s attorney and the Attorney General’s Office, the plaintiff may file a petition to reduce lien pursuant to Va. Code § 8.01-66.9, which empowers the trial court to apportion the recovery between the plaintiff, the plaintiff’s attorney, and the Commonwealth, as the equities of the case may appear. (more on this in a future post). Any effort to interplead the recovery funds will be barred by the doctrine of sovereign immunity. See Afzall v. Commonwealth, 273 Va. 226, 231 (2007) (quoting Alliance to Save the Mattaponi v. Commonwealth, 270 Va. 423, 455 (2005)).
As someone who has negotiated hundreds of these medical liens during my tenure as an Assistant Attorney General, I can tell you that following these tips will lead to a quicker and fairer resolution of a plaintiff’s lien reduction request. Good luck and please feel free to contact me for additional guidance.