Why is the insurance company valuing my injury claim based on what was paid for treatment instead of the higher amounts that were billed? – North Carolina

Short Answer

In North Carolina, insurers often focus on the amounts actually paid (or still required to be paid) to satisfy medical charges because those figures are commonly treated as the more reliable measure of “reasonable” medical expenses. Large “billed” amounts frequently include contractual write-offs or adjustments that no one is expected to pay, so adjusters may discount them when valuing a claim. Even if the insurer uses paid amounts to value the case, medical liens and reimbursement claims can still affect how much of a settlement ends up in the injured person’s pocket.

Understanding the Problem

In a North Carolina injury claim, an insurance adjuster may make a settlement offer that seems disconnected from the medical paperwork because the paperwork often shows two different numbers: the amount a provider billed and the amount accepted as payment in full. The decision point is whether the claim’s medical-expense value should track the higher billed charges or the lower amounts actually paid (or still owed) to satisfy the bills. This issue usually comes up after treatment for pain through multiple providers and physical therapy, when the insurer gives a “top and final” offer and the medical totals on statements look much larger than the offer.

Apply the Law

North Carolina law generally treats recoverable medical expenses as the reasonable value of necessary treatment caused by the injury. When the amount of medical charges is disputed, North Carolina has an evidence rule that centers the discussion on what was paid (or what is required to be paid) to satisfy the charges, and it creates presumptions about reasonableness based on those satisfaction amounts. In practice, insurers use that same concept in negotiations: they often value medical specials using the amounts that reflect what the bills were actually satisfied for, not the sticker price on the initial bill.

Key Requirements

Reasonable medical expenses: The medical charges used to support a claim should reflect a reasonable amount for the services, not just a starting “list price.”
Necessary treatment tied to the injury: The treatment must be reasonably necessary and connected to the accident-related injuries, not just treatment that happened after the crash.
Proof of what satisfied the bill: The amount paid (or required to be paid) in full satisfaction of the charges is commonly treated as the key figure when medical charges are at issue.

What the Statutes Say

N.C. Gen. Stat. § 8-58.1 (Medical charges; evidence of amount paid or required to be paid) – Allows testimony and records showing the amount paid (or required to be paid) in full satisfaction of medical charges and sets presumptions about reasonableness based on those amounts.
N.C. Gen. Stat. § 44-49 (Medical provider liens on personal injury recoveries) – Creates a lien right for certain medical-related charges tied to a personal injury recovery, with notice and itemization requirements.

Analysis

Apply the Rule to the Facts: Here, treatment involved multiple providers and physical therapy, so the paperwork likely includes billed charges that were later reduced by insurance contracts, adjustments, or write-offs. Because North Carolina’s approach to medical charges often emphasizes what was paid (or what must be paid) to satisfy the bills, the insurer may be valuing the claim using the lower “paid/allowed” totals rather than the higher billed totals. That does not automatically mean the offer is fair; it means the insurer is using a common valuation method that tracks satisfaction amounts and then arguing about how the injury affected daily life, duration of symptoms, and whether the treatment was necessary and accident-related.

Process & Timing

Who gathers the proof: The injured person (or attorney). Where: From each provider’s billing department and the health insurer/plan administrator. What: Itemized statements plus documentation showing the amount accepted as payment in full (often an EOB/ERA or ledger showing adjustments and the patient responsibility). When: Before responding to a “top and final” offer, so negotiations use the same numbers the insurer is using.
Confirm what is still owed: Separate (a) balances the patient must pay from (b) amounts written off and (c) amounts a health plan may seek to be reimbursed for. This step often changes the “net” value of a settlement because liens/reimbursement claims can attach even when the provider balance is $0.
Address liens before disbursement: If a settlement is reached, lienholders (including qualifying medical providers and sometimes health plans) may need notice and payoff confirmation before funds are distributed, so the settlement does not create a surprise repayment problem later.

Exceptions & Pitfalls

Confusing “write-offs” with “liens”: A bill can be written off by a provider (so the patient owes little or nothing) while a separate reimbursement claim may still be asserted by a health plan. These are different obligations and need different paperwork.
Using the wrong medical number in negotiations: Sending only the high billed totals without the satisfaction amounts can cause the adjuster to discount the package or assume the bills are inflated.
Not tying treatment to the accident: North Carolina does not automatically presume treatment was necessary because of the other driver’s conduct; medical records still need to connect the care to the crash-related injury pattern.
Settling without a lien/payback plan: A “top and final” offer can feel even lower after attorney fees, costs, and lien resolution. A settlement should be evaluated based on the expected net after known repayment obligations are addressed.

Conclusion

Insurance companies often value North Carolina injury claims using the amounts actually paid (or required to be paid) to satisfy medical charges because those figures are commonly treated as the more reliable measure of reasonable medical expenses than the higher billed amounts. That valuation approach can also affect how a settlement feels after liens and repayment claims are handled. A practical next step is to gather each provider’s itemized bill plus proof of the amount accepted as payment in full and use that documentation to evaluate the offer before signing a release.

Talk to a Wrongful Death Attorney

If you’re dealing with an injury settlement offer that seems too low compared to the medical paperwork and concerns about liens and fees, our firm has experienced attorneys who can help explain how insurers value medical charges and what timelines may apply. 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.