Andrew DeFusco

Recently, my paralegal and I discussed the many myths of personal injury law.  Having presented a Continuing Legal Education Seminar to the Arizona State Bar and a local lawyers’ CLE group on this topic,  I learned that many clients, and even some lawyers, misunderstand some basic personal injury law concepts.  A few of these myths are: 

1.         I have to pay back all my medical bills out of my settlement.  Usually you do not.  There is a big difference between the amount of medical expenses incurred, and who ultimately pays the medical expenses.  Most people have a health insurance plan that has a lower contracted rate with in-network providers than the provider’s actual billed charges, that pays a fraction of the medical bill, and requires you to pay only co-pays, deductibles and co-insurance amounts. The in-network provider may be required to “write off” the difference.  And Medicare and AHCCCS beneficiaries are typically not responsible for any portion of their medical expenses.

2.         I was injured in a collision caused by another driver.  She did not have insurance.  If I claim uninsured motorist benefits under my own policy, my premiums will increase. No, they won’t.  Too often, folks resist using insurance they’ve purchased (uninsured and underinsured motorist coverage, medical payments and collision coverages) when someone else has caused a motor vehicle collision.  Fortunately, Arizona law prohibits an insurer from increasing premiums as a result of an accident not caused or significantly contributed to by the actions of the insured.

3.         After I got out of the hospital, I received a “Notice of Healthcare Provider Lien” from the hospital in a large sum.  I fear the hospital may enforce this lien against the equity in my home, or against my bank or brokerage accounts. Another myth.  Healthcare provider liens are governed by statute, and are enforceable only against liability insurance settlements, not settlements involving uninsured and underinsured motorist coverage.  The lienholder is required to reduce its lien if the patient has an attorney who obtains a liability settlement.  And there is presently a class action pending that seeks to invalidate such liens for in-network healthcare providers.

4.         My young child was badly injured because of the conduct of another.  I’m the parent, so I have the right to settle his personal injury case.  Actually, you don’t. Arizona law requires that a conservator be appointed by the probate court (usually a parent) in order for the parent to have the legal authority to settle a child’s personal injury case.  Since the money belongs to the child, the courts require either that a court-restricted, FDIC insured account be set up, or the money be used to fund a structured settlement annuity that makes periodic, tax-free payments to the child after he turns eighteen.  We use the services of an annuity broker when structuring injury or death settlements for minors.

5.         I was injured by a drunk driver, and submitted my claim for restitution in the criminal case.  So now I can’t seek damages against the drunk driver in a civil case. Yes, you can!  Restitution and civil remedies are different:  Restitution provides out-of-pocket compensation to crime victims, while a civil remedy provides compensation not just for out-of-pocket expenses, but for the full amount of an injured person’s damages (medical expenses, loss of earnings, pain and suffering, and for especially egregious conduct, punitive damages).  While an injured person may pursue both remedies, the defendant gets a credit for the amount of restitution actually paid against any civil judgment that the victim obtains against the defendant in the civil case.     

6.         Parents are automatically responsible for the negligent driving of their child. This may be true or false, depending on the situation. Arizona recognizes the Family Purpose Doctrine, which imposes liability on Mom and Dad for the negligent driving of their child, provided that the child was driving a family vehicle for a “family purpose” at the time of the collision. 

7.         I was injured in a collision caused by another while driving for my job.  My employer provides worker’s compensation, so now I can’t pursue a claim against the other driver, right? You may do both!  While worker’s compensation is typically an exclusive remedy for on-the-job injuries, the injured worker may still pursue a claim against a third party who caused his injuries.  But the worker’s compensation carrier has a right to be repaid out of any eventual liability settlement proceeds. 

These are just a few.  Of course, when one suffers an injury caused by another, there is no substitution for competent legal counsel. 

We represent victims who have suffered serious injuries and families who have lost a loved one because of the negligence of others.  We maintain a low-volume practice dedicated to providing personal service to our clients, often during the most difficult times in their lives. Please keep us in mind if you know someone needing our services.