Guide to the Lien Act in Indiana

hospital bed

Across the state of Indiana, hospitals save innumerable lives daily. However, saving lives isn’t free, and hospitals need to collect payment for services rendered. Usually, the patient’s health insurance pays all or part of the expense of the treatment given. If an individual is injured and can file personal injury claims against the at-fault party, that individual’s insurance provider can file a subrogation claim. That means that if the patient is awarded damages as a result of the incident that led to their injuries, the insurance company may be entitled to some of it as reimbursement.

A hospital may file its own version of a subrogation claim if the patient has been injured due to the causation of another party. Their version of a subrogation claim is called a medical lien. A medical lien allows the hospitals to provide continuing services to the patient, especially in cases where the patient is not insured, with assurances that they can recoup some, or all, of the billed cost once a settlement is reached. Give us a call at (219) 300-5204.

Common Personal Injuries In Car Accidents

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Whether you live here in Indiana or are just visiting, a car accident can cause many injuries that may affect your life for days, weeks, months or even years to come. If you are injured in a car accident, an experienced lawyer can help you get the compensation you deserve. The types of injuries, their severity, and the length of time they will affect you are important considerations for a personal injury case and the resultant liens in the state of Indiana.


This is a generalized term referring to an injury to the neck affecting tendon, ligament, and muscle damage resulting from your body, more specifically the head, continuing at a rapid speed with the seat belt stopping your body. This can be a very painful injury that can cause long-term, even permanent damage.

Head Injuries

A head injury can be an acute and chronic condition that can also be permanent damage. It needs proper treatment to alleviate long-term effects such as headaches, sleeping issues, and cognitive issues.

Broken Bones

Pretty much any bone can be exposed to trauma that causes breakage due to the incredible forces placed on your body relative to the type of crash. These can be severe and may take surgical intervention but typically do not cause long-term or permanent damage.

Internal Bleeding

Damage to internal organs or ruptured blood vessels leading to bleeding inside the body can be a serious, potentially fatal, issue if not treated immediately. Usually, this is checked for and treated right away after an accident.

Back Injuries

Herniated disks would be the most common back injury suffered in a car crash. A herniated disc shifts out of place, or ruptures cause part of the disc to press against the spinal cord.

Post-Traumatic Stress Disorder

Not all injuries you incur in a car accident are physiological. The emotional and mental damage caused can also be very detrimental to your quality of life. You may have trouble doing routine tasks or develop crippling phobias related to the circumstances around your accident.

Indiana Hospital Lien Statute Modified In 2013

Back in 2013, the Indiana Legislature amended the Indiana Hospital Lien Statute. Some of the changes incurred in this amendment favor those injured in personal injury cases and car accidents in which they were not at fault. Following include some of the changes applied:

  • If an individual is receiving Medicaid or Medicare, a lien cannot be filed against them.
  • As it is relatively well known, many discounts and reductions are made in billing in agreements between insurers and medical providers. To circumvent these reductions in what they could charge the victim of a negligent act of another person, they would refuse payment from the insurance company. Instead, they would impose a medical lien on the patient and charge them in full, without the contractual reductions, write-off, and deductions. The amendments to the Indiana Hospital Lien Statute prohibit this practice, requiring the liens to be reduced by the exact amounts that would be afforded the insurance companies, regardless of whether or not the hospital pursued payment from the insurance company.
  • The lien does not apply to claims against an insurance policy with medical payments coverage or a disability policy.
  • Until the hospital can resolve the injury claim, they cannot legally pursue the collection of the bill incurred as a result of the injury claim.
  • If an agreement is reached in which the hospital agrees to accept less than the total lien amount, the hospital cannot seek the difference from the patient or their representative, and they must waive the remaining balance.
  • The hospital has 90 days post-discharge of the patient to file a medical lien, down from 180 days. 
  • Once the hospital lien has been paid, the lien must be released by the hospital within 15 days. Failure to do so results in a daily fine. The previous fine was $10/day, which has been increased to $25 / day.

Collection Of Lien Prior To Conclusion of Claim

The first thing to do is find out whether or not the hospital that treated you placed a medical lien against you. Usually, there will be a notification mailed to you shortly after being released from the hospital. Once the lien is received, make sure you inform your lawyer, especially when first starting your injury claim. Failure to pay your lien is handled the same way the hospital would handle a past due bill. Important to note here, as mentioned above, the hospital cannot seek to recoup any payment until the conclusion of the injury claim.

While your case is active and you seek your settlement, you won’t have to worry about coming to terms with the hospital and paying that bill. Also, this delay between being billed by the hospital and resolving your claim is a great time to renegotiate your account, further reducing your responsibility to the hospital and allowing you to keep more of your settlement. Another consideration is that medical bills can be inaccurate and unfair. The lien placed upon you may be far too high for the procedures performed and care given in those circumstances.

If you have additional questions about the Lien Act in Indiana, reach out to the knowledgeable team at Alvarez Law Office. You can contact us 24 hours a day, seven days a week, by completing a secure online message or giving us a call at (219) 300-5204.

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