Who Pays Medical Bills After a Car Crash?

Medical bills start arriving within days of a crash, but an injury claim against the other driver is usually settled only after treatment is far enough along to know what the injury will cost. In the auto accident cases we handle, this gap is one of the first worries people raise. The other driver's insurer does not normally pay bills as they come in; it pays once, at the end, when the claim is settled or decided.

This guide explains who pays in the meantime, how those payers get repaid, and the California rules that protect you from aggressive billing while you wait.

How do medical bills get paid during a claim, step by step?

Use your health coverage. Give every provider your health plan, Medi-Cal or Medicare information, just as you would for any other care.
Use your own medical payments coverage. If your auto policy includes it, it covers limited medical costs for you and others in your car, whether or not you were at fault, according to the Department of Insurance's auto insurance guide.
Tell providers about the claim. Give them the claim number and the other driver's insurer, but ask them to bill your health coverage as well.
Keep every bill and statement. These become your proof of claim, and the insurer has 40 days after proof of claim to accept or deny (California Code of Regulations, title 10, section 2695.7(b)).
Track who paid what. Your health plan, Medi-Cal or a hospital may claim repayment from the settlement later.
Resolve the repayment claims at settlement. Liens and reimbursement claims are paid from the settlement, within the legal limits, before the balance goes to you. Our guide on what comes out of a personal injury settlement explains that last step.

Which payer covers what, and how is it repaid?

Who pays now	When it pays	How it may be repaid	Source
Your auto policy's medical payments coverage	Limited medical costs for you and passengers, regardless of fault	Depends on your policy terms	Department of Insurance auto guide
Your health plan or health insurer	Under your plan, like any other care	A lien limited to what it actually paid, and no more than one-third of your recovery if you have a lawyer (one-half if not)	Civil Code 3040
Medi-Cal	Covered care for enrolled patients	Its claim is limited to the medical part of the settlement, and a settlement is not final without notice to the State	Welfare and Institutions Code 14124.76
A hospital that is not paid	It may wait for the settlement	A lien on the recovery, if it gives written notice before payment; paid from no more than 50 percent of the money due after prior liens	Civil Code 3045.1, 3045.3 and 3045.4
The other driver's liability insurer	Once, at settlement or judgment	Not applicable: it is the source of the recovery	Department of Insurance auto guide
Workers' compensation, if you were working	Treatment for a work injury	Reimbursed from a recovery against the other driver	Labor Code 3856

Why doesn't the other driver's insurer pay my bills as they come?

The other driver's policy is liability coverage: it pays for harm its driver is legally responsible for, and its company decides that responsibility only after investigating. The Department of Insurance's guide describes liability coverage as paying for injuries and damage to other people, up to the limits purchased, and it does not pay for injuries to the policyholder or their household. That is why liability insurers usually pay injury claims in one settlement, not bill by bill.

The insurer must still decide the claim on time. Once it receives proof of claim, it has 40 days to accept or deny, and it must explain any delay in writing every 30 days. Our guide on how long the insurance company has to respond lists each deadline.

What if I have no health insurance?

California hospitals must keep written charity care and discount payment policies, and uninsured patients, or patients with high medical costs, whose income is at or below 400 percent of the federal poverty level are eligible to apply (Health and Safety Code 127405). Ask the hospital's billing office for those policies as soon as the bills arrive. The same section requires the hospital's discount payment policy to state that an emergency physician who treats patients in a hospital emergency room is also required by law to offer discounts to qualifying patients.

A hospital, or a collection agency or debt buyer that takes over the debt, may not report adverse information to a credit agency or sue for nonpayment before 180 days after the first bill (Health and Safety Code 127425(f)). If you are applying for financial assistance and making reasonable payments in good faith, the hospital may not send the bill to collections unless the collector agrees to follow the same rules (Health and Safety Code 127425(g)).

A hospital that is not paid may instead give notice of a lien on your recovery under Civil Code 3045.1. That lien is limited, as the table shows, and it must be supported by a written notice sent before the insurer pays.

What changes the answer?

You had medical payments coverage. It is often the quickest money available, because it does not depend on fault. Our guide on claiming through your own insurance or the other driver's explains how it fits with the rest of the claim.

Medi-Cal paid for treatment. The State must get notice and a reasonable chance to claim before a settlement is final, and if you file a lawsuit, notice is due within 30 days of filing (Welfare and Institutions Code 14124.76 and 14124.73).

You were partly at fault. A health plan's lien under Civil Code 3040 is reduced by your fault percentage when a judge, jury or arbitrator makes that finding. See who pays when several drivers share the fault.

The other driver had no insurance. Your uninsured motorist coverage may pay what the other driver's policy would have (Insurance Code 11580.2). Read how uninsured and underinsured motorist coverage works.

You were working when the crash happened. Workers' compensation pays treatment for a work injury, and it is repaid from any recovery against the other driver (Labor Code 3856). See a crash while working.

What could this look like? An example

For example, imagine a driver in Rohnert Park who is rear-ended and needs an MRI, eight weeks of physical therapy and a visit to an orthopedic doctor. She has a health plan and $2,000 of medical payments coverage on her auto policy.

Her auto insurer pays the first $2,000 of bills under medical payments coverage, without waiting for anyone to accept fault. Her health plan pays the rest at its contracted rates, and she pays her usual copays. Eight months later, she settles with the other driver's insurer. Her health plan's lien is limited to what it actually paid, capped at one-third of her recovery because she had a lawyer, and reduced by a share of the fees and costs under Civil Code 3040. Her copays are part of her damages in the claim. This example is made up to show how the rules fit together; it says nothing about any real case.

What mistakes do people make with medical bills?

Not giving providers their health insurance, so bills go unpaid and into collections.
Assuming the other driver's insurer will pay each bill as it arrives.
Paying a bill directly and then paying it again through a lien at settlement.
Not telling Medi-Cal about the claim, which can delay a settlement.
Throwing away explanation-of-benefits statements, which show what the plan paid and will claim back.
Stopping treatment because of cost without first asking the hospital about its discount and charity care policies.

What should I do this week?

Give every provider your health plan, Medi-Cal or Medicare information.
Check your auto policy for medical payments coverage and open a claim under it.
Start a folder for bills, receipts and explanation-of-benefits statements.
If you are uninsured, ask each hospital for its charity care and discount payment policies in writing.
Send the other driver's insurer copies of bills as proof of claim, and keep a dated copy.
Read our guide on what to bring to a first meeting with an injury lawyer and add your bills to that file.

Frequently asked questions

Can a hospital refuse to bill my health insurance and wait for the settlement?

A hospital that treats an injured person may claim a lien on the recovery (Civil Code 3045.1), but the lien is limited by Civil Code 3045.4 and requires written notice. Ask the hospital in writing to bill your health coverage and keep a copy of your request.

Will my health plan want its money back?

Often, if its contract gives it that right. Civil Code 3040 limits the lien to what the plan actually paid and caps it at one-third of your recovery with a lawyer, or one-half without one.

Do I have to pay copays and deductibles myself?

Yes, as they come due under your plan. Keep the receipts, because out-of-pocket medical costs are part of what the claim seeks from the at-fault driver.

What if a bill goes to collections while my claim is pending?

Hospitals and their collectors may not report to credit agencies or sue for nonpayment before 180 days after the first bill (Health and Safety Code 127425(f)). Ask whether you qualify for the hospital's financial assistance, and keep records of any payment plan.

What if the other driver's insurance limit is lower than my bills?

California's minimum liability limit is $30,000 for one person's injuries (Vehicle Code 16056), and serious injuries can cost far more. Your own underinsured motorist coverage may pay the difference; see how underinsured motorist coverage works.

Does the settlement have to pay my future medical care too?

Yes, if the injury needs future care, that cost is part of the claim. That is one reason settling before doctors can predict future care is risky; see how long a personal injury case takes.

If medical bills are piling up after a crash, contact Young Law Group today at (707) 343-0556 or through our contact page for a free consultation.

Who pays my medical bills while my car accident claim is pending?