Pennsylvania Health Plan Reimbursement: The Car-Accident Bar and Made-Whole

By the FigureMyTax Editorial Team · How we calculate

In an action arising from a motor vehicle, Pennsylvania law says there is no right of subrogation or reimbursement from your tort recovery for benefits paid by a program, group contract or other arrangement, and you cannot recover those amounts from the at-fault driver. Outside car accidents, a compendium reports subrogation is allowed and the made-whole rule applies.

The bar

75 Pa.C.S. 1720 says that in actions arising from the maintenance or use of a motor vehicle there is no right of subrogation or reimbursement from a claimant's tort recovery for workers' compensation benefits, first party benefits under sections 1711, 1712 and 1715, or benefits paid or payable by a program, group contract or other arrangement under the coordination of benefits section. Section 1722 precludes you from recovering those same amounts from the tortfeasor or in an uninsured or underinsured proceeding.

What a compendium reports

A law-firm compilation of Pennsylvania subrogation law reports that subrogation of medical benefits is otherwise allowed, that the made-whole rule applies, that a voluntary settlement within policy limits can make you whole, and that the car-accident bar does not reach policies delivered outside Pennsylvania or vehicles not registered there. We did not read the decisions, so treat these as leads.

A worked example

Say a health plan paid $9,000 after a car accident and you settle for $100,000 with a one-third fee and $3,000 in costs. If the plan is an insured policy delivered in Pennsylvania, it has no claim against your recovery. For a self-funded employer plan under federal law, it may claim the full $9,000. The Pennsylvania medical lien calculator offers those positions and a made-whole option for other injuries.

Medicaid is different

Medicaid has its own statutes (62 P.S. 1409); see the Medicare and Medicaid post.

What to do

Ask for an itemized claim and the plan document, ask whether the plan is insured, self-funded or delivered in another state, and tell the plan about the statutory bar. See how provider bills differ from liens.

This is general information, not legal advice, and the state comparisons above are illustrative, not an exhaustive survey. Confirm how Pennsylvania's rules apply to your specific case with a licensed Pennsylvania attorney.