Understanding the Problem

If you are settling a North Carolina car-accident injury claim, can the insurer (or your attorney) take money out of your settlement to pay medical bills or “liens” that have nothing to do with the crash, especially when the insurer has already reviewed your neck and back treatment records?

Apply the Law

North Carolina recognizes statutory liens tied to personal-injury recoveries for certain medical charges. The core idea is simple: when you recover money for an injury, providers who treated that injury may have lien rights against the recovery if they follow the statute’s notice and documentation rules. Unrelated bills (for unrelated conditions or different incidents) generally do not fit the statutory “in connection with the injury” requirement, even if you owe them money.

In practice, lien issues usually get handled during settlement disbursement. If you are represented, your attorney typically gathers lien notices, confirms what the lien covers, disputes improper amounts, and resolves valid liens before distributing the net settlement.

Key Requirements

• Connection to the accident injury: The lien is for drugs, supplies, ambulance, or medical/hospital services provided in connection with the injury you are being compensated for.
• Proper notice and documentation: The lienholder generally must provide written notice of the lien and, if requested, provide an itemized statement/records within the statutory timeframe as a condition to a valid lien.
• Funds are subject to the lien once paid: The lien can attach not only to a judgment but also to settlement funds paid in compensation for the injuries.
• Disputed amounts are not automatically payable: If the amount for medical services is genuinely disputed, the law does not force payment until the claim is established through the proper legal process.
• Limits and priority rules may apply: North Carolina law includes limits on how large certain medical liens can be against a recovery (separate from attorney’s fees) and sets priority rules for certain governmental plans.

What the Statutes Say

• N.C. Gen. Stat. § 44-49 (Medical-provider lien on personal injury recoveries) - Creates a lien for specified medical-related charges rendered in connection with the injury for which damages are recovered, and requires notice/itemization steps for validity.
• N.C. Gen. Stat. § 44-50 (Duty to retain funds after notice; cap) - Provides that the lien can attach to settlement funds and requires retaining enough to pay just and bona fide lien claims after notice, with a statutory cap (exclusive of attorney’s fees).
• N.C. Gen. Stat. § 44-51 (Disputed medical charges) - Addresses disputed medical-service claims and states the law does not compel payment until the claim is established.
• N.C. Gen. Stat. § 135-48.37 (State Health Plan subrogation/lien) - Gives the State Health Plan subrogation and lien rights for payments related to an injury caused by a liable third party, with priority rules and a cap structure described in the statute.

Analysis

Apply the Rule to the Facts: Because your claim involves a motor-vehicle accident with neck and back strain and related treatment, the bills most likely to reduce the net settlement are those tied to that accident-related care (for example, the ER, imaging, physical therapy, or similar services connected to the crash injuries). If a provider or plan is trying to collect for treatment that is not connected to this accident, that demand generally does not fit North Carolina’s accident-connection requirement for a medical-provider lien. The practical next step is to identify each claimed lien, what dates and diagnoses it covers, and whether it is actually asserting a lien right or simply trying to collect a separate debt.

Process & Timing

1. Who reviews: The injured person and (if represented) their attorney. Where: During settlement negotiations and before disbursement of settlement funds in North Carolina. What: Request lien notices and itemized statements/records that show what charges are being claimed and why. When: Early enough that lien issues do not delay signing a release and distributing funds.
2. Confirm whether the claim is accident-related: Compare the lien claim to the accident date, the body parts involved, and the treatment timeline. If the claim includes unrelated care, ask the lienholder to correct it and provide a revised statement.
3. Resolve or dispute before disbursement: Valid lien claims are typically paid (or negotiated) out of the settlement at closing. If an amount is disputed, the parties may need to hold back funds while the dispute is addressed under the applicable process.

Exceptions & Pitfalls

• Not every “lien” is a Chapter 44 lien: Some demands are really reimbursement/subrogation claims by a health plan, or a collection effort by a provider, and the rules can differ depending on the type of payor and plan language.
• Mixed billing is common: A single provider statement can include both accident-related and unrelated charges. If you do not separate them, you can end up negotiating or paying the wrong amount.
• Notice and documentation matter: A provider’s lien rights can depend on giving proper written notice and providing itemization/records when requested. Do not assume every demand is automatically enforceable as a lien.
• Disputed charges can slow settlement: If you dispute whether a bill is connected to the crash (or dispute the amount), build time into negotiations so the lien issue does not delay disbursement.
• Priority rules can change the math: Certain governmental plans can have priority over other lien claims, which can affect how settlement funds get allocated.

Conclusion

In North Carolina, a personal-injury settlement is typically reduced only by valid medical bills or lien claims that are tied to treatment “in connection with” the accident injury—not unrelated medical debts. Before money is distributed, you should identify each claimed lien, confirm it relates to the crash treatment, and require proper notice and itemization. Next step: request written lien details and an itemized statement, and use the 60-day documentation window as part of your lien review.