Reviewed and updatd 8/28/2026
Most health insurance plans contain a clause that requires you to reimburse them out of any settlement or judgment you recover from a third party who has an obligation to pay your medical expenses. If you fail to pay them back after they have paid your medical expenses related to the accident you made a recovery in, they can sue you for their money back. This is known as “subrogation.”
What is Subrogation?
Subrogation is a right to be reimbursed for expenses paid on behalf of another. This right must be created by statute, contract, or equitable principles of law.
What is Statutory Subrogation?
Statutory subrogation occurs when a specific statute or Federal law creates a lien against the beneficiary’s right of recovery. Medicare and Medicaid are examples of government-funded programs that are entitled to subrogation against a personal injury claim by law. Additionally, hospitals providing emergency service in Texas and some emergency service providers have a statutory subrogation right to recover for services rendered to an injured party if that party recovers damages from someone else for the injury. Hospital liens and Medicare liens are the most commonly seen examples of this type of lien.
What is Contractual Subrogation?
Contractual subrogation is when a written contract obligates someone to repay benefits if they recover in a personal injury action against another. Most healthcare insurance carriers include a provision in the contract that entitles them to this type of subrogation. So, always check your health insurance policy to confirm your contractual obligations.
What is Equitable Subrogation?
Equitable subrogation applies when there is no contract, but the law allows a party to be subrogated as a matter of fairness. This rule of law is used in some circumstances to require reimbursement.
Have an Attorney Review the Insurance Policy
You should always double-check your health insurance policy and consult your attorney about the legal effects of any subrogation clause it may contain if you are bringing a personal injury claim against another for medical expenses that were paid, in all or part, by a health insurance carrier. If you do not have a personal injury attorney, call Simmons and Fletcher, P.C. for a free consultation: (713) 932-0777.
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