What Is a Letter of Protection?

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A letter of protection is something you may need to request from an attorney after an accident if you are being charged for medical care but have not yet received financial compensation from the at-fault party’s insurance company to pay for your medical bills. This is a common situation, as an insurance claim or personal injury lawsuit often takes longer than the medical billing process. A letter of protection promises your medical provider that it will see the money that you owe after your case has been resolved.

When Do You Need a Letter of Protection?

In the immediate aftermath of an accident, you may need emergency medical care. Most accident victims cannot afford to pay for 100 percent of their care, with or without health insurance. In this situation, who pays the hospital for the treatments that you already received? The answer to this question depends on the specifics of the case. However, you can utilize a letter of protection in the meantime to prevent your case from being sent to avoid facing a medical lien.

A medical lien is a legal claim that a hospital, doctor or health care provider can have to your personal property. If you fail to pay your medical debt, the lien gives the lienholder the right to sell your property and keep the profits to pay what you owe. One way to avoid this issue while your personal injury lawsuit is pending is with a letter of protection. Although not every victim needs this letter, it might be the right solution for you based on the circumstances of your case.

How Does a Letter of Protection Work?

When you hire a personal injury attorney, a letter of protection is something that he or she can send to your medical providers to halt bill processing and give you more time to pay. It is a guarantee given by your lawyer that all of your medical bills will be paid after your personal injury case has been resolved. It tells a doctor that you are taking legal action against one or more parties for causing your injuries and that while you are unable to pay upfront, the hospital will receive what it is owed when the case has reached an outcome.

When a letter of protection is used, you and your lawyer are promising to pay your doctor back for the costs that it spent upfront in treating you in the aftermath of a car crash, slip and fall accident, workplace incident, or another disaster. A letter of protection is a legally binding contract that protects the health care provider from being left with an accident victim’s medical debts. It also protects a victim from having to pay for medical care out of pocket or face negative consequences due to medical debt.

Does a Letter of Protection Impact Your Injury Settlement?

Yes and no. Technically, a letter of protection means that a portion of your settlement will automatically be sent to your health care provider to fulfill your promise to pay off your medical debt. However, since you did not pay out of pocket for your medical care to begin with, this portion of your settlement would not have been awarded to you anyway. Therefore, you are not losing any money with a letter of protection.

Furthermore, a skilled personal injury lawyer may be able to negotiate your medical debt down by the end of your case, so that you get to keep more of your settlement or judgment award. Your lawyer may be able to ensure that the hospital does not receive more financial compensation than you do from a defendant for your accident and injury, for example.

Whether or not you need a letter of protection depends on the specific circumstances of your case. To learn more about this legal document, talk to an attorney at Knowles Law Firm. We offer free case consultations.