Can my lawyer negotiate a medical provider’s lien down so I receive more of the settlement?
Can my lawyer negotiate a medical provider’s lien down so I receive more of the settlement? - North Carolina
Short Answer
Yes—often your lawyer can ask a medical provider to reduce (or “compromise”) what it claims from your settlement, especially when the settlement is limited or the bill is disputed. In North Carolina, though, a provider that properly asserts a medical lien can require your lawyer to hold back enough money to cover “just and bona fide” charges before disbursing the rest. Whether a reduction is possible depends on whether the provider has a valid lien, how it was perfected, and whether the amount is truly owed and reasonable.
Understanding the Problem
If you are settling a North Carolina personal injury case and a chiropractic provider treated you “on a lien,” you may be asking: can your lawyer negotiate that provider’s lien down so you receive more of the settlement, especially since you are waiting for lien amounts to be finalized before the money is disbursed?
Apply the Law
North Carolina law recognizes a statutory lien in favor of certain medical providers for treatment related to the injury that led to your recovery. When a provider properly asserts that lien and gives the required notice, the settlement funds are effectively burdened by the lien, and the person holding the funds (often your attorney) has a duty to retain enough money to pay valid medical charges before distributing the remainder. That said, the law does not prevent negotiation. Many lien claims resolve through voluntary compromise, and disputes about the amount or validity of the claim can delay or change what gets paid.
Key Requirements
A qualifying medical debt tied to the injury: The lien is for drugs, medical supplies, ambulance services, and services by providers such as physicians, dentists, nurses, and hospitals (and similar treatment services) connected to the injury that produced the settlement.
Proper notice and documentation to your attorney: For the lien to be valid, the provider must give your attorney written notice of the lien claimed and, if requested, provide an itemized statement/records within the statutory timeframe.
Funds must be held before disbursement once notice is received: After notice, the holder of settlement funds must retain enough to pay “just and bona fide” medical claims before distributing the rest.
Statutory cap (exclusive of attorney’s fees): The medical lien amount (not counting attorney’s fees) generally cannot exceed 50% of the damages recovered.
Disputes can pause payment: If the amount demanded is genuinely in dispute, the law does not force payment until the claim is established and determined through the legal process.
Reduced payments may require a pro rata accounting: If a lienholder is paid less than claimed under the statutory framework, the lienholder can request a certification showing the distribution was handled consistently with the statute.
Apply the Rule to the Facts: You are waiting on lien amounts before disbursement, and a chiropractic provider treated you on a lien basis and expects to be paid from the settlement. Under North Carolina law, if that provider properly asserted a lien and gave the required notice and documentation, your lawyer generally must hold back enough settlement money to cover the provider’s just and bona fide charges before releasing the remainder to you. Even so, your lawyer can still try to negotiate a reduction—especially if the bill is disputed, documentation is missing, or the settlement is not large enough to comfortably cover all claims.
Process & Timing
Who contacts the provider: Your attorney. Where: Directly with the provider’s billing office (not a court filing in most negotiated reductions). What: A written request for the lien amount, an itemized statement, and supporting records; and a written settlement demand for a reduced payoff amount. When: As soon as settlement is reached and before disbursement, because your attorney may need to retain funds after receiving lien notice.
Verify whether the lien is valid and complete: Your attorney typically checks whether the provider gave written notice of the lien and, if requested, provided the required itemization/records within the statutory window. If information is missing or the amount is disputed, your attorney may treat the claim as disputed and seek clarification or resolution before paying.
Resolve and document the payoff: If the provider agrees to a reduction, your attorney should get the agreement in writing (a payoff letter or written confirmation) and then pay the agreed amount from the settlement. If the provider does not agree and the claim remains disputed, your attorney may need to hold back the disputed amount until it is established and determined through the appropriate legal process.
Exceptions & Pitfalls
“Lien basis” vs. statutory lien: A provider may say treatment was “on a lien,” but the enforceable rights against settlement funds depend on whether the provider complied with North Carolina’s lien statute (including notice and documentation requirements).
Disbursing too early: Once your attorney has notice of a lien claim, North Carolina law can require retaining enough funds to cover just and bona fide charges. Pushing for immediate payout can create problems if the lien later proves valid.
Not treating a real dispute as a dispute: If the amount is legitimately disputed (for example, the bill is not itemized, includes unrelated treatment, or the amount is contested), the dispute needs to be handled carefully and documented. Simply ignoring the claim can delay closing the file or trigger collection activity.
Pro rata and documentation issues: If multiple lienholders exist and the settlement is limited, reduced payments may need to be handled on a consistent, pro rata basis, and a lienholder can request a statutory certification explaining the distribution.
Different rules for certain payors: Some entities (including certain government-related plans) can have different priority or recovery rules than ordinary providers, so your lawyer should confirm what type of claim it is before negotiating strategy.
Conclusion
In North Carolina, your lawyer can often negotiate a medical provider’s lien down, but a properly asserted lien can require your lawyer to hold back enough settlement funds to pay just and bona fide medical charges before disbursing the rest to you. A key issue is whether the provider gave proper written notice and, if requested, timely itemized records. Your next step is to have your attorney send a written request for the provider’s itemized lien statement and payoff amount, and track the 60-day response window.
Talk to a Personal Injury Attorney
If you’re dealing with a medical provider lien that is delaying settlement disbursement, a personal injury attorney can help you confirm whether the lien is valid under North Carolina law, identify disputes that matter, and negotiate a payoff so the settlement can be distributed correctly. Call CONTACT NUMBER to discuss your options and timelines.
Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.
