Short Answer

In North Carolina, your lawyer must pay valid, perfected liens and certain statutory reimbursement claims (like Medicare, Medicaid, or the State Health Plan) from the settlement before releasing funds to you. You cannot opt to pay those later yourself. If a provider has no perfected lien, the attorney is not required to withhold for it; you may pay that bill directly, but the provider can still pursue you for the balance.

Understanding the Problem

You settled a North Carolina personal injury claim and want to know whether you can receive your money now and pay medical bills yourself later, instead of having them deducted at settlement. One provider did not present a valid lien. The decision point is: must the attorney pay certain medical claims from your settlement now, or may you take the funds and handle them on your own?

Apply the Law

North Carolina law gives health care providers a lien on personal injury recoveries if they properly perfect it before disbursement, and it limits how much of your net recovery can go to those provider liens. Your lawyer must also resolve statutory reimbursement claims (for example, Medicare, Medicaid, and the State Health Plan) from settlement funds. Distributions typically occur through your attorney’s trust account after final lien amounts are confirmed and any reductions are negotiated.

Key Requirements

• Perfected lien required: A provider must give written notice and an itemized statement before disbursement to secure payment from settlement funds.
• Attorney’s duty to protect liens: Your lawyer must pay perfected liens and statutory reimbursement claims from settlement proceeds before releasing your share.
• 50% cap and pro rata rule: Total payments to qualifying medical provider liens cannot exceed 50% of your net recovery after attorney’s fees, and competing liens share that amount proportionally.
• Public program priorities: Medicare and Medicaid have statutory rights to reimbursement; the State Health Plan also has specific recovery rules that may not follow the 50% cap for provider liens.
• No lien, no mandatory holdback: If a provider does not perfect a lien, the attorney need not withhold for it; you remain responsible for the bill outside of settlement.

What the Statutes Say

• N.C. Gen. Stat. § 44-49 (Medical provider liens) - How providers perfect liens and qualify for payment from a PI recovery.
• N.C. Gen. Stat. § 44-50 (Distribution; 50% cap) - Caps total provider-lien payments at 50% of net recovery and requires pro rata allocation.
• N.C. Gen. Stat. § 108A-57 (Medicaid subrogation) - Establishes Medicaid’s lien and allocation rules on third-party recoveries.
• N.C. Gen. Stat. § 135-48.37 (State Health Plan reimbursement) - Provides the State Health Plan’s recovery and subrogation rights.

Analysis

Apply the Rule to the Facts: Because EMS and a health insurer asserted lien/reimbursement rights, your attorney must address and pay those valid claims from the settlement before releasing your funds. The insurer’s claim was negotiated down, which is common and appropriate. The separate provider did not present a valid lien, so your attorney is not required to withhold money for that bill; you can choose to pay it yourself, but the provider may still pursue you directly.

Process & Timing

1. Who files: Your attorney. Where: Disbursement occurs from the attorney’s trust account in North Carolina. What: Confirm and negotiate lien/reimbursement amounts (e.g., provider liens, Medicare/Medicaid/State Health Plan), then prepare a final settlement statement. When: Commonly within 30–60 days after settlement, longer if waiting on Medicare’s final demand.
2. Attorney sends payments to perfected lienholders and statutory payors, obtains releases/acknowledgments, and documents any reductions; timing varies by agency and provider response.
3. Attorney issues your check and a final settlement statement itemizing fees, costs, lien payments, and your net recovery.

Exceptions & Pitfalls

• Health plans governed by federal law (for example, certain self-funded ERISA plans) may assert reimbursement rights not limited by the 50% provider-lien cap; verify plan status early.
• Medicaid and the State Health Plan have specific statutory procedures; overlooking them can create liability or delay closing.
• Do not assume every medical bill must be paid from settlement—only perfected liens and statutory claims require holdback; unperfected bills remain your responsibility.
• Provider liens share the capped amount pro rata; paying one in full can prejudice others and create disputes.
• Disbursing funds before receiving final lien amounts (especially from Medicare) can trigger interest or repayment demands.

Talk to a Personal Injury Attorney

If you're dealing with medical liens and reimbursement claims after a personal injury settlement, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

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.