How Much of Your Personal Injury Settlement Can Medicaid Take?

If you’ve been injured due to someone else’s negligence and received financial assistance for medical treatment through Medicaid, there’s something you should know. The State Department has the right to be reimbursed for those expenses—which means they are entitled to a portion of your personal injury settlement.

If you’re wondering how this is possible or how much money Medicaid can take from your personal injury settlement, keep reading. We’ll tell you everything you need to know.

Understanding Medicaid Laws

To understand your rights, you must first understand Colorado law, which allows the State Department to place a lien on your personal injury settlement to recover the Medicaid expenses they paid on your behalf. However, this lien cannot exceed the actual amount of medical assistance Medicaid provides.

To illustrate, consider a scenario in which a negligent driver injured you, and Medicaid paid $10,000 for medical treatment. Later, you receive a $50,000 settlement from the driver’s insurance company. In this case, the State Department has a subrogation right to recover $10,000 from your $50,000 settlement to cover medical expenses.

Calculating What the State Department Can Take

In Colorado, the entire amount of any personal injury judgment, award, or settlement of a Medicaid recipient's action or claim, with or without suit, regardless of how characterized by the parties is subject to the state department's lien.

But when the Medicaid recipient’s case is brought by an attorney, the state department will pay its reasonable share of attorney fees not to exceed twenty-five percent of the state department's lien. Unfortunately, the state department is not be liable for costs.

Example:

Lien amount – attorneys’ fees reduction* = net repayment amount

*Attorneys’ fees reduction = lien amount – (25% × lien amount).

The net repayment amount is the final amount the State Department is entitled to recover for Medicaid expenses.

Please reach out to our experienced personal injury attorneys to get the assistance you need with your case or if you have questions. We will walk you through the process, make calculations on your behalf, get maximum value for your case, and ensure you are not giving away more of your settlement than you should.

Paying Back Medicaid After a Personal Injury Settlement

When clients learn about Medicaid’s right to reimbursement, many wonder if it is even worth pursuing a personal injury claim. Experience has shown us that it often is, as Medicaid generally only takes a small portion of your net recovery after deducting attorney fees.

After reporting your claim, Medicaid will notify you within 120 days about the amount it has paid on your behalf. If you disagree with this amount, contact our personal injury attorneys. We will review your case, determine your goals, and decide together whether to proceed with the appeals process or pursue another avenue.

Don't Let Subrogation Rights Interfere with Your Personal Injury Settlement

If a third party has injured you or a loved one, know that you do not need to work through the complexities of subrogation on your own. Our experienced personal injury attorneys are here to guide you through the process, ensuring you receive the maximum compensation you deserve. Contact us today for a free consultation!