What Is a Letter of Protection?
Brian White | January 10, 2018 | Personal Injury
When an accident happens, getting the victim compensation for medical care can take time. This may put the person in a bind if he or she lacks his or her own coverage or the funds to pay for care. In this instance, the health care provider, Houston injury lawyer, and victim can create a contract that guarantees payment for care. Learn more about this contract, the different types that exist, and how one might be useful in your situation.
What Is a Letter of Protection?
A Letter of Protection, commonly called an LOP, this letter grants the individual coverage for medical care while a lawyer works to get compensation from the liable party. This tool functions like a contract.
In the contractual terms, the provider agrees to give all necessary care, to send bills to the victim, and to wait for payment until the lawyer finishes litigation. The victim agrees to pay for all care received in the event he or she receives no compensation. The lawyer bears responsibility for informing the provider if a compensation is received and making sure the provider is paid out of the recovered funds.
This can create a unique situation when recovery does not happen. Providers often bill at a higher rate to cover losses in other similar cases or to compensate for a potentially years-long process. The client remains legally responsible to pay the bill, even if completely unable for a variety of reasons. A client’s inability to work during this time further complicates the situation.
Payment for medical care must be made when the care is received, but medical insurance companies want your car insurance to pay for injuries sustained in a car accident. This creates complications because car insurance companies will not pay for medical care as it happens. They wait for you to receive all your care, then submit bills so they can make a settlement offer in whole. They also may refuse to pay or offer substantially less than your care cost.
Even when the care goes on for months, companies still expect you to pay. Because of this, doctors now refuse to bill car accident patients via their health insurance. This is where the LOP helps you, guaranteeing your care and guaranteeing the doctor future payment. An LOP also helps preserve your credit by preventing you from entering collections.
Can an LOP Be Used Against Me?
Insurance company lawyers may try to use the LOP against you in court. They may imply that the billed amount stems not from the care received, but from a doctor with a financial interest dependent on the client receiving a larger payout. They call into question the doctor’s opinion on your care, claiming the doctor can’t be objective when he or she stands to make so much money. They may even question the provider’s motivation for helping you, implying he or she did it merely to get an easy payout.
This overlooks the fact that the LOP exists because insurance companies delay payments, forcing the doctor, the injured party, and the lawyer to make this kind of legal arrangement in the best interest of all parties.
If you find yourself in a situation where your coverage proves inadequate for the required care, or you are considering not obtaining necessary care to help with your injury, the LOP exists for you. It helps you receive the care you need and provides the ability to wait for just compensation, rather than accepting a quick settlement. You can find samples of an LOP online, including specific requirements for the state of Texas.