Short Answer

In North Carolina, resolve liens before you disburse settlement funds. Confirm who has a lawful right to reimbursement (medical providers, Medicaid, Medicare, the State Health Plan, or a private/ERISA health plan), verify the amounts and what bills relate to the accident, apply any statutory caps and priorities, and negotiate reductions. Hold funds in trust until you obtain final demands and written releases, then distribute accordingly.

Understanding the Problem

In North Carolina, after you settle a personal injury claim, how do you clear a health insurer’s subrogation lien so you can pay the client? Here, the client’s group health plan paid multiple providers’ bills after a broadside collision, and the file now needs policy details, provider information, the police report number, and insurer contacts to address the lien.

Apply the Law

North Carolina law treats repayment rights differently depending on who asserts them. Health care providers have statutory liens on injury recoveries and must be paid within statutory limits. Public payers—Medicaid and Medicare—and the North Carolina State Health Plan have specific reimbursement rights set by statute or federal law. Private health plans may seek reimbursement based on contract; if the plan is self-funded and governed by ERISA, federal law can control. The trigger for all of this is settlement or judgment, and you should resolve liens before distributing funds.

Key Requirements

• Identify the lien type and authority: Determine whether claims arise under provider lien statutes, Medicaid, Medicare, the State Health Plan, or a private/ERISA plan.
• Verify amounts and relatedness: Obtain an itemized ledger of bills actually paid for accident-related care; dispute unrelated or duplicate charges.
• Apply statutory caps and priorities: Provider liens are capped by statute; public program rights can override or sit outside these caps.
• Account for fees/costs: Apply attorney’s fees and costs before calculating capped provider payments; seek common-fund or equitable reductions where applicable.
• Document and release: Get written final demands and releases (or waivers) before disbursing client funds.

What the Statutes Say

• North Carolina Gen. Stat. § 44-49 (Medical provider liens) – Allows providers to assert liens on personal injury recoveries when perfected by notice.
• North Carolina Gen. Stat. § 44-50 (Distribution and 50% cap) – Sets distribution rules and caps combined provider liens to a portion of net recovery after attorney’s fees.
• North Carolina Gen. Stat. § 135-48.37 (State Health Plan reimbursement) – Grants the State Health Plan reimbursement and subrogation rights against third-party recoveries.
• North Carolina Gen. Stat. § 108A-57 (Medicaid lien and subrogation) – Establishes Medicaid’s lien and reimbursement process on injury recoveries.

Analysis

Apply the Rule to the Facts: Because a group health plan paid the client’s accident-related bills, first confirm whether it is a fully insured plan (state law limits may apply) or a self-funded ERISA plan (plan terms often control). Pull the paid-claims ledger from the plan and match each charge to the collision. Then address perfected provider liens under North Carolina’s 50% cap rules, and clear Medicaid/Medicare/State Health Plan claims as applicable before disbursing.

Process & Timing

1. Who files: The injured party (through counsel). Where: Pre-distribution, handled by counsel; court involvement only if there’s a dispute. What: Request the plan’s Summary Plan Description, plan funding status (self-funded vs. insured), a paid-claims ledger, provider lien notices, and any final demand letters. Provide the police report number and provider list to the plan. When: Immediately after settlement, and before any client disbursement.
2. Calculate net recovery after attorney’s fees/costs. Apply the provider lien cap, pay perfected provider liens pro rata within the cap, and negotiate reductions. Separately resolve Medicare, Medicaid, or State Health Plan demands according to their final statements. Adjust for unrelated or duplicate charges and get updated final demands.
3. Obtain written releases or satisfaction letters from each lienholder/plan. Then disburse funds from trust per the settlement statement. If a dispute remains, consider interpleader in Superior Court and hold the disputed funds until court direction.

Exceptions & Pitfalls

• State Health Plan and Medicare: These reimbursement claims operate by statute or federal law and are not limited by the provider lien cap.
• ERISA self-funded plans: Plan terms may preempt state limits; request the plan document to confirm funding status before negotiating.
• Provider lien perfection: Only perfected liens need to be paid under the provider lien statutes; verify notice and amounts, and pay pro rata within the cap.
• Relatedness disputes: Exclude unrelated/duplicate treatment; ask for coding corrections or withdrawals before paying.
• Trust account risk: Disbursing before resolving liens can expose the attorney and client to repayment demands and interest; hold funds until cleared.

Talk to a Personal Injury Attorney

If you’re dealing with a health insurer or medical provider lien after a North Carolina 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.