Eliminating or even reducing medical liens in Illinois is no easy task and must always be considered before settling a claim. The Illinois legislature has it made it clear that medical providers will recover all or at least a substantial amount of their medical bills when rendering services to an individual involved in a lawsuit.
Medical lien reduction in Illinois is governed by the Healthcare Services Lien Act ( 770 ILCS 23/1). The Act abolished the Illinois Supreme Court holding in Burrell v. Southern Truss, 176 Ill. 2d 171, 679 N.E.2d 1230 (1997).
Prior to the Health Care Services Lien Act there were numerous lien statutes. In Burrell the Illinois Supreme Court held that each category of lien holder, and there were many, was entitled to assert a lien of up to 33.3% of the settlement amount which could lead to no recovery for a plaintiff.
The Healthcare Services Lien statute consolidated all other healthcare liens into 2 categories: healthcare professionals such as licensed physicians, dentists, optometrists, psychologists or physical therapists; and health care providers like licensed hospitals, surgery centers home health agencies and emergency medical providers.
The charges must be reasonable and total health care services liens cannot to exceed 40% of the gross settlement. Each category is limited to 20% of the gross settlement and 40% combined. If the lien amount is more than the statutory percentage of the gross each provider within that category is to share on a pro-rata basis.
Illinois Courts are reluctant to reduce liens outside the boundaries of the Statute. In a recent case we attempted to reduce multiple medical liens from uncooperative medical providers. One particular surgical charge was quite expensive and our client had got a bad result and needed a second surgery. The court noted that the total amount of lien was within the statutory boundary and there was no provision for reducing a lien due to a bad surgical result.
However we were able to extinguish the lien of provider who at first accepted our client’s insurance but reversed the payments when he learned that his patient was a plaintiff in a lawsuit.
While the Illinois healthcare lien statute protects providers and professionals bills up to 40% of the gross settlement amount the statute places strict requirements on the placing the lien.
The lienholder must provide written notice containing the name and address of the injured person, the date of the injury, the name of the health care provider and the name of the party liable to the injured party.
The lien must be served by registered or certified mail or in person n the injured person and the liable party. Failure to provide proper notice will likely lead to the lien being extinguished or reduced.