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What is medpay coverage and how does it work?

In Colorado Med Pay is a benefit you can purchase under your own auto insurance policy. It usually comes in benefit amounts of $5,000, $10,000 or $25,000. Depending on your policy, you may be able to purchase even more.

Med Pay covers your initial medical bills including ambulance, emergency room, imaging work and can be used for other medical treatment including physical therapy, massage and chiropractic.

Med Pay coverage is a good idea even if you have good health insurance. The is because Med Pay benefits never have to be paid back from your injury settlement proceeds. In contrast, when you use your health insurance to pay for your medical care after a crash, your health insurance has a right of subrogation. This means the health insurance company has a right to stand in your shoes and look to the at-fault driver and her auto insurance policy for reimbursement for money spent on your medical care.  Just about every car accident case in which the injured party has health insurance has subrogation claims that need to be negotiated and resolved.  With Med Pay, however, there is never a right of subrogation for the medical treatment billed and paid for by Med Pay.  This almost always puts additional money, often thousands of dollars, into an injured person's pocket at settlement that otherwise wouldn't be there. 

The best-case scenario is when an injured person has both Med Pay coverage and high-quality health insurance.  Med Pay works in addition to your health insurance to benefit your case.  Health insurance companies have contracts with many medical providers which provide substantial discounts to the cost of the medical care you receive. For example, if a hospital charges $10,000 for your emergency room visit, your health insurance will likely negotiate a substantial reduction in the amount that it pays.  At the end of the case, the subrogation payment may be less than half what the hospital originally charged. This effect almost always puts more money into the injured person's pocket at the end of the case.

Remember, the goal of personal injury representation is to recover as much as possible for your injuries, damages, and losses. Med Pay and health insurance are two important tools for reaching those goals.