How Medical Bills and Fees Come Out of a Settlement

Attorney Answer

A mediated settlement is paid out in a set order, and the number you were awarded is not the number you take home. In the usual sequence, the attorney's fee comes out first under the written contingency agreement you signed, then the case expenses that agreement lists, then any medical bills, liens, or reimbursement claims that have been asserted against the settlement, and the balance goes to you. Your own attorney is the person who must show you that arithmetic before you sign anything.

Ask for a written settlement statement. It should list the gross settlement, the fee and the percentage it was calculated at, each expense, each medical provider or health plan being paid and the amount, any reduction negotiated with those providers, and your net. Getting it in writing is how you check the math, and it is a normal request, not a hostile one.

Two things drive the outcome more than anything else. The first is what has been asserted against the settlement. Hospitals, other providers, and health plans may assert liens or reimbursement rights, and Texas has statutes and contract rules that set which claims must be paid, in what order, and how much can be reduced. Those rules are technical, they vary by the type of provider and plan, and they are a question for your attorney about your specific bills rather than something to read off a general page. The second is that many of these amounts are negotiable, and lawyers routinely negotiate provider balances down so the client's net improves.

A word about the ceiling you ran into. Tex. Transp. Code § 601.051 requires a driver to establish financial responsibility, and § 601.072(a-1) sets the minimum limits at $30,000 for injury to one person, $60,000 per crash for two or more, and $25,000 for property damage. A $30,000 policy is the state minimum for one injured person, and it caps what that insurer will pay no matter what the injury was worth. Whether any other source of recovery existed, such as a claim against a vehicle's owner or coverage under your own policy, is something to raise with your attorney rather than assume.

What you can do

1. Ask your attorney, in writing, for the settlement statement and for a copy of the fee agreement you signed.

2. Ask for an itemized list of every medical bill, lien, or reimbursement claim being paid from the settlement, with the amount claimed and the amount actually being paid.

3. Ask whether provider balances and any health-plan reimbursement have been negotiated down, and what the answer was.

4. Ask about outstanding bills that have not been submitted yet, and who is responsible for them after disbursement.

5. Ask about the expected timing, and about anything still required before funds are released.

6. If the answers do not come, or the numbers do not add up, ask another Texas attorney to review the settlement statement and the fee agreement with you. Most lawyers offer a brief initial call at no cost, and a few minutes on your specific facts with someone who can ask you questions is worth more than any general guidance, including this page.

⏱ Time limits apply. Tex. Civ. Prac. & Rem. Code § 16.003(a) generally allows two years from the day the cause of action accrues to sue for personal injury or property damage, and other deadlines can apply once a case has settled or been mediated, including deadlines in the settlement documents themselves. Where your matter stands now determines which dates still matter, so ask your Texas attorney to confirm them rather than assuming the two-year rule is the only one left.