The law in New Mexico regarding the rejection of uninsured/underinsured motorist coverage seems to be turned on its head in the recent New Mexico Supreme Court case of Marckstadt v. Lockheed Martin, consolidated with the 10th Circuit Court of Appeals case of Federated Insurance v. Martinez.

The case involved the purchase automobile insurance for company vehicles. An employee was injured in an auto accident and made a claim against the uninsured/underinsured coverage on the policy. There was no written rejection of the coverage and the rejection was not attached to the policy. However, the employer indicated that it was understood that the coverage was waived. The Court made no indication that its opinion was fact specific. The case should raise concerns for every purchases of insured. I will not even begin to address the problems with the possible complicity between the insurance company and the employer who no doubt saved a few bucks in the denial of its employee‘s rightful recovery of damages for his injuries.

The law seemed to be well established requiring a written rejection of uninsured/underinsured motorist coverage under New Mexico law to be both signed by the insured and attached to the policy. The case of Arias v. Phoenix Indemnity issued just in July 2009 said as much. So it is surprising that Marckstadt would come so quickly on its heals setting aside what seemed to be both good law and sound public policy.

Instead Marckstadt takes the rather perplexing position that rejection of uninsured/underinsured motorist converge must be written but need neither be signed nor attached to the policy. The court then stated that there should be some evidence that the insured‘s rejection was “made part of the policy by endorsement, attachment, or some other means that calls the insured‘s attention to the fact that coverage has been waived.”

What in the world does this mean? Can the language be hidden in small print? Can it be written on the hand of the insurance agent? Could it be whispered in the agent‘s office with failure to acknowledge taken as acquiescence? In fact, it means nothing other than the insurance companies will be allowed every possible avenue for denying coverage to unwary customers. It is just one more accommodation to the insurance industry who will used every advantage to avoid payment of claims to preserve profits.

In the past, I would usually end by saying that when faced with an accident that calls your uninsured/underinsured motorist coverage into question, you would be well advised to seek the advice of a New Mexico Attorney. As the law now stands, you would be well advised to seek that attention when reviewing the insurance policy coverage limits. As a practical matter, since it seems clear that the rejection could be hidden in the vast array of documents involved in the auto insurance policy process, and therefore will be hidden, you would be well advised to write on the face of the application that you are not rejecting uninsured/underinsured coverage which may be the only possible means of recovery for your injuries. Then have your friendly insurance agent initial the statement next to your own.

DISCLAIMER

Related Reading:
New Mexico Laws on Rejection of Uninsured/Underinsured Motorist Coverage are Retroactive
New Mexico Supreme Court Expands Scope of Law on Rejection of UM/UIM Coverage
Notice Requirements in New Mexico Uninsured/Underinsured Motorist Cases

Punitive damages are awarded in limited cases for the purposes of punishment of the defendant. Punitive damages also serve to deter similar such behavior by the defendant and others similarly situated. In New Mexico personal injury cases, punitive damages are awarded only when a defendant‘s behavior is found to be malicious, willful, reckless or wanton.

Many New Mexico personal injury claims assert a claim for punitive damages but the “malicious, willful, reckless or wanton” standard is pretty difficult to meet. In essence, the defendant‘s behavior must be pretty outrageous in nature to justify a punitive damages jury instruction from the court.

In auto accident cases, the question then arises whether insurance will cover the punitive damages awards. This question actually involves two separate elements. First, will the negligent driver‘s auto insurance liability limits cover a punitive damage award? Second, assuming that the negligent driver‘s insurance is inadequate to cover the total damages award, will the innocent driver‘s uninsured/underinsured motorist coverage cover any part of the punitive damages award?

These same issues would arise in a pre-trial or pre-litigation settlement. On the other hand, it is a rare and generous insurance company on either side of the claim that would admit the propriety of punitive damages prior to litigation.

The answer to both questions is yes. Insurance coverage, both liability and uninsured/underinsured motorist coverage, provides coverage for punitive damage awards in a New Mexico auto accidents. The innocent injured driver is entitled to recover for all allowable damages under the New Mexico personal injury law.

The issue will generally not arise in the case of liability coverage since liability coverage in New Mexico auto accidents is generally grossly inadequate. New Mexico carries the highest percentage of uninsured drivers in the nation with many more severely underinsured. Thus, the liability coverage limits will typically not even cover the compensatory damages, much less the punitive damages.

Instead, the issue will more often arise when the innocent driver makes a claim on his or her uninsured/underinsured motorist policy. Some insurance companies will attempt to deny these legal claims. However, the law is clear and has been clear for quite some time since the 1991 New Mexico Supreme Court case of Stinbrink v. Farmers Insurance Company of America. The Court in Stinbrink made clear that uninsured/underinsured coverage does provide coverage for punitive damages.

Even here, however, policy limits often become an issue. New Mexico drivers typically carry inadequate liability limits to cover the harm that they do. Likewise, they generally carry woefully inadequate uninsured/underinsured coverage as well. As such, the findings in Stinbrink are purely academic in most cases as the insurance policy limits will always dictate the coverage in any particular auto accident case.

Insurance issues are confusing. The policies themselves typically provide very little illumination and may leave some even more confused after reading. Thus, it is important to consult with a New Mexico attorney to address the many coverage issues related to a New Mexico personal injury claim.

DISCLAIMER

Related Reading:
Recovery Under Underinsured Motorist Coverage Not Constrained by Punitive Damage Exclusion of Underinsured Driver
Punitive Damages in New Mexico: What is Reasonable?
Caps on Punitive Damages: Great for Business, Bad for Everyone Else

The Albuquerque Journal had an interesting article last week regarding the refusal of some stores to sell alcohol to drivers with interlock licenses. This seems to be an obvious tool for the reduction of DWI/DUI related auto accidents. Though there are a few vendors that have adopted the policy, most have not. The question arises why more do not adopt the policy of refusing the sale of alcohol to DWI/DUI offenders on interlock drivers licenses.

Drivers arrested for DWI/DUI face automatic license revocation by New Mexico Motor Vehicles Division. In addition, the courts impose a separate and independent license revocation following a criminal conviction for DWI/DUI. Drivers with revoked licenses due to DWI/DUI arrests or convictions must obtain a special interlock license and install an ignition interlock device on their vehicle. Driving in violation of these terms carries up to one year in jail.

The owner of Albuquerque‘s Jubilation Wine & Spirits was quoted in the Albuquerque Journal article as saying that he is refusing the sale of alcohol to those with interlock licenses to do his part in helping to keep drunk drivers off the road. This is certainly admirable on his part and it is unfortunate that more store owners do not take the same position. There is no law that prohibits the sale of alcohol to drivers with interlock licenses. Does the store have a duty to keep drunk drivers off the road despite the lack of law to that effect? It seems that they may under simple dram shop liability theories.

As part of every DWI/DUI charge, there are conditions of release that prohibit drinking and driving. This seems to go without saying. There is also the condition that the defendant consume no alcohol at all while the case is pending. Likewise, upon conviction, the same prohibition against the consumption of alcohol applies throughout probation.

DWI/DUI drivers cannot legally use alcohol so they certainly have no business purchasing it. There is no good reason to allow the sale of alcohol to drivers with interlock licenses. The sale of alcohol to a person known to have a problem with drinking and driving, who clearly as a term of his conditions of release or probation is prohibited by court order from using alcohol, creates a plain threat to the safety of the driving public.

Jubilation is on the right track. Others who fail to follow the lead may do so at their peril. Dram shop liability laws provide a very good model for holding irresponsible store owners liable for damages and harm caused as a result of serving up alcohol to those known to be a threat to the public. A bar cannot sell alcohol to someone that is already intoxicated because this poses a threat to public safety. Does the same rationale not apply to selling alcohol to DWI/DUI offenders currently under driving restrictions due to the danger they pose to the public?

There are two approaches to attacking DWI/DUI. First and most obviously, the drunken drivers must be held accountable. Secondly, the source of the alcohol can be addressed. The State has not seen fit to prohibit the sale of alcohol to DWI/DUI offenders. It seems only a matter of time before personal injury lawsuits are filed against alcohol vendors for these irresponsible and indefensible practices that will inevitably at some point lead to tragedy. Perhaps these lawsuits will help to reduce the number of DWI/DUI drivers on New Mexico roads.

DISCLAIMER

Related Reading:
Reach of New Mexico Dram Shop Laws Extends to Business Wining & Dining
Dram Shop Liability Issues Not Always Apparent
Dram Shop Liability: Shifting Burden of Proof

Collins & Collins, P.C.
Albuquerque Attorneys

President Obama has announced sweeping mine safety initiatives in response to the recent West Virginia mining disaster in which 29 miners were killed. This is all well and good, but will it have any effect on the profit-driven corporations that run these mines? Sadly, the answer is probably no.

Massey Energy, the company that runs the Upper Big Branch mine where the recent tragedy occurred, was issued 515 citations in 2009 for that mine alone. There were already 124 citations against Massey Energy for Upper Big Branch mine in 2010. Over the last 5 years, Massey has been fined over $7 million for safety violations. Of course, they fight these tooth and nail and have paid only $2.3 million. Massey Energy, and other like-minded mining operators, seem to take the approach that they will fight every nickel of fines, dragging these cases out for years. All the while, they continue to rack up safety violations jeopardizing the lives of their workers.

Let‘s say for argument that Massey was forced to pay the full $7 million in fines. Would that change their safety practices? Take a look at the numbers and judge for yourself.

Massey Energy reportedly had 2009 revenue of $583.9 million, down from previous year‘s revenue of $661.28 million. It is also reported that Massey Energy CEO Don Blankenship made somewhere in the vicinity of $19 million in 2008. It doesn‘t take a math genius to recognize that these paltry fines are not going to alter the profit driven decisions of Massey Energy or any other corporate actor.

What is a miner‘s life worth? Is a mine worker‘s life worth the investment in safety necessary to prevent the avoidable tragedies that occur far too often in mines? How about 29 workers? Apparently, the answer is no. This is quite obvious when one looks at the safety record of Massey Energy. The profit equation must be altered.

What‘s the answer? President Obama is certainly on the right track but there needs to be more. These companies must pay the price for reckless safety practices that jeopardize their workers. I am confident they will, but not through the fines envisioned by the new wave of safety inspections. These paltry fines have had and will have no affect companies like Massey Energy that place profitability before the safety of their workers.

Instead, the real price will come from the personal injury lawsuits sure to come in the next several months. And when they do, the Tort Reformers will cry foul that the greedy trial lawyers are simply taking advantage of a tragic situation. They will make these arguments knowing full well that these lawsuits carrying significant compensatory and punitive damage awards will provide the only real incentive for corporate change. Changing the profit equation to include possible massive damage awards is the only thing that will get their attention. And it is the only way to avoid future tragedies like the Upper Big Branch mine disaster.

DISCLAIMER

Related Reading:
Employer Responsibility for Worker Safety? No, But Thanks for Playing.
When An Attorney Is (and Isn‘t) Necessary in a Work-Related Injury Claim
Personal Injury, Insurance Coverage and the Lies of Tort Reform

Collins & Collins, P.C.
Albuquerque Attorneys

Uninsured/Underinsured motorist coverage is vitally important to New Mexico drivers. New Mexico has one of the highest uninsured motorist rates in the nation with 29% of its drivers uninsured. Many more are underinsured meaning they carry only minimal liability coverage that will fall well short of covering any injuries they cause in an accident.

Uninsured/Underinsured (UM/UIM) motorist coverage can cause much confusion for motorists. This is particularly so with stacking of UM/UIM coverage. Stacking allows the insured driver to stack the coverage on several vehicles insured under the same policy. Stacking of UM/UIM coverage may be critical to an injured person recovery of damages.

Typically, UM/UIM is covered at the same level as the liability limits on the policy. As such, if a driver carries $25,000 in liability coverage, then the UM/UIM coverage will also be at $25,000. If the driver has 3 vehicles insured at $25,000 limits, then stacking will provide for a total of $75,000 in UM/UIM coverage.

UM/UIM coverage and the stacking of coverage is automatic on auto insurance policies in New Mexico. In order to either waive UM/UIM coverage or the stacking of UM/UIM coverage, the insurance company must obtain a rejection of UM/UIM coverage from the insured driver. Likewise, the insurance company must get an agreement with the insured driver to reject stacking of the coverage on all vehicles covered under the policy. Recent decisions have added some confusion to the issue stating that though the rejection must be made part of the policy, it need not be signed. This is contrary to prior case law.

In cases of serious auto accidents, the injuries can be very severe. Often, the medical costs alone, past and future, will far exceed $25,000 in cases of serious personal injuries. In these situations, stacking of coverage alone will provide the injured person with any reasonable compensation for his or her damages. Even this at times may prove grossly inadequate.

UM/UM is relatively inexpensive to carry. To be expected, because the coverage is such a good deal for its customers, some insurance companies will often try to talk drivers out of it. They will also try to convince the driver to waive stacking coverage.

All that a driver needs to know is that there is no good reason to reject uninsured/underinsured motorist coverage. Neither is there any good reason for waiving stacking of UM/UIM coverage. Such waivers of coverage benefit nobody but the insurance company. The consequences for the driver can be devastating leaving unrecoverable damages such as past and future medical expenses, lost earnings, disfigurement and permanent injuries, pain and suffering and the like.

The attorneys of Collins & Collins, P.C. specialize in car accident cases in the Albuquerque area.  Contact us today for a consultation.

 

There have been a couple of recent decisions involving very large damage awards against bars for the drunken actions of their patrons. The cases fall under dram shop and premises liability laws that protect the visitors, patrons and customers of such drinking establishments. These case involved obvious dram shop and premises liability. Other cases of negligent or reckless service of alcohol may not be as obvious. This is particularly so in auto accident cases.

The Tennessee case of Maddy v. Ruby Tuesday Inc. involved a jury award of $10 million. A poorly trained 21 year old bartender had served a patron 19 beers over a three hour period. The drunken patron ended the evening by smashing a beer mug in the face of another patron, severing the victim‘s carotid artery. The bartender testified that she did not recall seeing any corporate training videos prohibiting the service of any customer more than three drinks in an hour.

A Texas appellate court upheld a $1.48 million verdict for damages related to a barroom brawl at the Del Lago Golf Resort & Conference Center. Much like the Tennessee case, the employees of the bar were clearly untrained or undertrained. The brawl involved a wedding party and a Sigma Chi fraternity reunion party. The problem for the defendant was that witnesses testified that the brawl had begun brewing hours before the actual fight broke out. Rather than address the problem, the bar‘s staff continued the heavy flow of liquor and then at the end of the evening herded both parties into the parking lot where the melee erupted.

Certainly, a bar cannot always be held responsible for the drunken behavior of its patrons. However, in cases like these where the bar actually creates the danger through the over-service of alcohol while ignoring possible dangers to other patrons, the bar will be held responsible for the damages resulting from the negligent behavior of its staff.

In fact, dram shop laws in most states, including New Mexico, require that bartenders and staff be trained to both detect and avoid the over-service of alcohol. The dangers of severe intoxication are well known, from the drunken bar brawls in these cases to the horrible DWI/DUI auto accidents that regularly result from the negligent service of alcohol at bars, restaurants and nightclubs.

The severe injuries and deaths that occur as a result of negligent bartenders and waitresses are too numerous to count. In these cases, the negligence of the bars in question are obvious. However, in cases involving auto accidents, the injured persons or their surviving family members fail to or are unable to trace the accident back to these negligent or reckless practices. In late night auto accidents, the possibility of such negligence should be explored. Due to chronic level of underinsured drivers in New Mexico, the bar that began the train of events that led to the accident may be the only possible source of financial recovery for the injured or deceased person‘s damages.

DISCLAIMER

Related Reading:
Change In Evidence Requirements For Dram Shop Claims
Dram Shop Liability: Shifting Burden of Proof
New Mexico Dram Shop Liability Extended to Protect Intoxicated Patrons

Collins & Collins, P.C.
Albuquerque Attorneys

Corporate defendants in personal injury lawsuits can be extremely uncooperative and evasive. After all, payment of claims does not fit within their profit model. In trucking accident cases, the level of obstruction will on occasion rise to the level of outright dishonesty and deceit. This is a problem on a national level and New Mexico is not immune to these abusive practices.

In trucking accident cases, the trucking company and its insurance carrier send in their investigative teams immediately. This would appear to be sound corporate responsibility. They call these their “Go Teams” and their mission is anything but responsible.

The Go Teams consist of investigators, accident reconstructionists and of course insurance defense attorneys. From the very beginning, the Go Teams are focused on defending any possible personal injury lawsuit to come. The entire investigation is geared toward defending the lawsuit.

Understanding that the insurance company is leading the charge, this is not surprising. It almost too obvious to say that the first instincts of the insurance companies is to deny liability to avoid their financial responsibility for damages to the public they are charged with protecting.

The Go Team will often neglect to identify or obtain statements from witnesses adverse to their defense. Likewise they will often ignore evidence that does not support their position which instinctively is to deny responsibility for the accident. Instead, they will focus only on those witnesses and evidence that supports their position. These investigations are not about bringing the facts to the surface but about defending the claim.

Trucking accidents generally involved very serious injuries or death to the unfortunate drivers on the other end of the collision. A trucking accident, by virtue of simple physics, are typically far more serious that the run of the mill auto accident. A very high percentage of these accidents involves fatalities. Unfortunately, the severely injured or dead are in no position to conduct an on site investigation of their own at the time of the accident. As a result, it is very important to collect as much information as possible as soon as possible after the accident. This is often left to the family, friend or other loved ones of the injured or deceased victim of the trucking accident.

Due to the unique problems and challenges of trucking accident cases, it is important to get an attorney involved as early as possible. By early, I mean immediately. Evidence and witnesses have a way of disappearing for many reasons, some innocent, some not. Make no mistake, the evidence and witnesses not documented by the Go Teams is the evidence most important for a personal injury claim in the trucking accident case.

DISCLAIMER

Related Reading:
Trucking Accidents and Meth Usage: Respondeat Superior Still Applies in New Mexico
Huge Verdict In Trucking Accident Involving Texting Truck-Driver
Work Related Auto Accident Injuries and Employer Uninsured/Underinsured Motorist Coverage

Collins & Collins, P.C.
Albuquerque Attorneys

Mobile phones clearly present a danger to the driving public. Mobile phone use causes over 500,000 auto accident related injuries each year. Texting and driving can be almost as dangerous as drinking and driving. Simply talking on the phone also poses dangers which led to Albuquerque and Santa Fe banning all but hands free devices while driving.

Unfortunately, a great deal of business is conducted in cars on mobile phones every day. All varieties of business activity is conducted by mobile phone from pizza delivery to the highest levels of business. Texting is an epidemic that reaches far beyond teenagers. Perhaps just as bad, email has come to dominate the business days of many. The lure and call of texts and emails is simply too great for many to resist despite the dangers. The problem is growing worse, not better.

So too do accidents, many extremely serious or fatal, continue to grow. The technology has become so widely accepted that drivers do not appreciate or choose to ignore the dangers of texting, emailing or even talking on the phone while driving. Over 500,000 people are injured and 6000 die each year from distracted driving as a result texting, emailing or talking on the phone.

The negligent driver is clearly at fault when they cause an accident due to mobile phone use. His or her employer may also be liable under respondeat superior or agency. In fact, there are businesses that not only encourage this dangerous practice but demand it. The most obvious example, but certainly not the only, is sales where sales personnel are constantly on the move and constantly in communication with their offices, clients and prospects. Rather than discourage the practice, it is as a practical matter required for performance.

In any serious auto or truck accident, it is important to determine the what the negligent driver was doing at the time of the accident. Certainly, it should be determined if mobile phone was involved. It should also be determined if the negligent driver was acting on behalf of an employer. This includes determining not just whether the negligent driver was on the job but whether the person was engaged in activity for the benefit of his or her employer.

If the person was acting on behalf or in furtherance of an employer, the employer may have some liability for the accident. In some cases, the employer‘s liability may be significant. In cases of serious personal injury or wrongful death, the liability of the employer may provide the only real recovery for the injured person.

This is particularly the case in New Mexico which has a very high percentage of uninsured and underinsured drivers. New Mexico has the largest percent of uninsured drivers in the nation. Just as troublesome for those injured in auto accidents, New Mexico drivers are notoriously underinsured with the great majority carrying only minimal liability limits of $25,000. As a result, the first and often greatest challenge in a New Mexico auto accident case is finding insurance.

Fortunately, most businesses carry a variety of insurance that will kick in cases where their employees or agents have harmed others, including those involved in auto accidents. In fact, the only real coverage may come from the employer‘s insurance. The very business activity that caused the accident may provide the only net available to those harmed by it.

DISCLAIMER

Related Reading:
Company Liability for Employee Negligence Under Respondeat Superior
Work Related Auto Accident Injuries and Employer Uninsured/Underinsured Motorist Coverage
Protections of New Mexico Workers‘ Compensation Act Waived for Non-Compliant Employers

Collins & Collins, P.C.
Albuquerque Attorneys

Texting and driving do not mix. Governor Richardson of New Mexico has been pushing for a statewide ban on the use of cell phones while driving both for talking and sending texts. Several cities in New Mexico, including Albuquerque, Santa Fe, and Las Cruces, have already banned the use of mobile phones while driving. These laws have not been real popular with many.

How dangerous is texting and driving? A Car & Driver Magazine study found that texting and driving was more dangerous than drinking and driving. The study found that texting drivers were 3 to 4 times slower to hit their breaks than drunk drivers. Car & Driver is not exactly known for scientific rigor but one need not look far to find some support for their findings. Though their claims may be slightly exaggerated, the numbers clearly support their general finding that texting is indeed extremely dangerous.

The National Highway Safety Administration (NHTSA) has found that texting is among the most serious and dangerous distractions facing drivers. NHTSA studies have found that close to 6,000 people were killed and more than 500,000 were injured in 2008 as a result of the negligence of a distracted or inattentive driver. Many of these were related to texting and/or mobile phone usage. By comparison, MADD found that 11,773 deaths were caused by DWI/DUI in 2008. Perhaps Car & Driver overstated the dangers of texting in comparison to DWI/DUI, the numbers clearly illustrate their point that texting and driving do not go together.

Sadly, the facts on the roads more forcefully illustrate the dangers of texting and driving. Last month, in the case of Small v. Vestal, a Texas jury awarded $21.7 million in damages, $20 million in exemplary (punitive damages), in a personal injury lawsuit to the family of a 21 year old college student killed in an auto accident. Tragically, the accident was caused by another college student who was found to have sent and received several text and phone calls around the time of accident. Two young and promising lives were destroyed. More tragic still, many people just cannot resist the urge to text and countless lives will be lost in the future as a result of texting and driving.

This is just one in a series of huge jury verdicts for texting and driving. These verdicts reflect the fact that juries recognize the dangers of texting and driving as significant and dangerous distraction to drivers. It seems almost too obvious to even argue that drivers should not be driven to distraction. In light of the dangers of texting, just imagine the dangers of putting the internet in the driver‘s hands. This is already possible with mobile phone technology. But can we make it worse.? Of course we can, and apparently we will. Auto makers want to put the internet on the dashboard of new cars.

Then who is responsible? The teenager who cannot resist the lures of the internet on the dash? Or the automakers reckless enough to go down this road? Much like the mantra of the Right, “Guns Don‘t Kill People, People Do”, the mantra of Tort Reform is that “Reckless Products Don‘t Kill…” So we know the answer.

DISCLAIMER

Related Reading:
Hypertexting & Hypernetworking: Busy Hands are the Workshop of the Devil?
Car Accidents: A Leading Cause of Death in Teens
Huge Verdict In Trucking Accident Involving Texting Truck-Driver

Collins & Collins, P.C.
Albuquerque Attorneys

Medicaid liens can cause significant financial complications following settlement of a personal injury lawsuit. There are significant penalties for failure to properly account for those liens out of settlement funds. It is important that the Medicaid liens be addressed and satisfied with both New Mexico Human Services Department (HSD) and Center for Medicare and Medicaid Services (CMS) prior to distribution of personal injury settlement funds. It is equally important to the injured person that Medicaid not be overcompensated for their liens.

Medicaid through HSD and CMS is quite serious about collecting on its liens. In fact, Medicaid will on occasion assert liens beyond what it is legally mandated. This overstatement of its lien is typically the result of some confusion in the law regarding Medicaid reimbursement. This confusion over the Medicaid‘s rights to reimbursement can be quite costly if not addressed properly.

In most cases, Medicaid is very reasonable in addressing liens so long as the liens are addressed in a timely manner prior to settlement of personal injury claims. However, as a result of misinterpretations of the law, HSD in particular has been known to demand full recovery of all medical expenses advanced by Medicaid. In fact, Medicaid is not necessarily entitled to the full reimbursement of all Medicaid advanced medical expenses. This is particularly true in cases involving serious personal injuries.

Medicaid is entitled only to the recovery of liens associated with medical expenses. In a personal injury lawsuit, particularly in cases with serious injuries, the settlement or award typically includes a wide range of damages including lost wages, loss of consortium,loss of household services, permanent injury and disfigurement, pain and suffering and punitive damages. These are entirely distinct from the damages awarded for medical expenses.

Medicaid is not allowed to recover for any non-medical related damages. The reason for this is simple. As set forth in the 2006 United States Supreme Court case of Arkansas Department of Health and Human Services v. Ahlhorn, Medicaid may not “share in damages for which it has provided no compensation…” Medicaid provides no relief or support for damages other than medical expenses and therefore will not reap the benefit of any award for these other non-medical related damages.

It is not uncommon that the settlement or award does not specifically break down the allocation between medical damages and other non-medical damages. In case of a dispute over the breakdown, the parties can call on the court for a determination of the allocation between medical and non-medical damages. The Court will then apportion the damages between medical and non-medical damages based upon the injuries in the case. Medicaid will then reimbursed based upon the Court‘s apportionment of damages.

Medicaid issues are very complicated and it is important to seek the advice of an attorney prior to accepting any settlement. All liens, including Medicaid liens, should be negotiated prior to final settlement. Failure to negotiate liens in advance may have severe financial consequences for the injured person. This is particularly so in case of Medicaid liens for which failure to pay may result in significant fines and penalties.

DISCLAIMER

Related Reading:
10th Circuit Addresses Medicaid Lien Reduction in Personal Injury Settlements
Reduction of Medicare/Medicaid Liens on Personal Injury Funds for Unrelated Medical Expenses
Beware Medicare & Medicaid Liens in Personal Injury Lawsuits

Collins & Collins, P.C.
Albuquerque Attorneys