Your health insurer’s right to recover its medical costs for your treatment is spelled out in your insurance contract. The first order of business is to understand the type of coverage you currently have or expect to have in the future. In the U.S., there are many ways to obtain health insurance.
Three of the most popular are Medicare, Medicaid, and private (or employer-provided) health insurance.
- Medicare: Medicare is the federal government’s healthcare program for senior citizens. Medicare provides healthcare for those 65 or older or those under 65 who are disabled, suffering from permanent kidney failure (or End-Stage Renal Disease), or diagnosed with Lou Gehrig’s disease.
- Medicaid: Medicaid is the state government’s healthcare program for low-income individuals who can’t afford to pay for medical care. More than 60 million Americans are on Medicaid. Each state has its own Medicaid program, so the laws for Medicaid may vary from state to state. Like all state or federal programs, Medicaid’s reimbursement right is based on the law or state regulations governing it. You become obligated to follow your state’s Medicaid rules as soon as you receive your first dollar of coverage.
- Private Insurance: Private health insurance is administered by many different insurance companies. Most Americans on private insurance get their coverage through their employer (these are often referred to as ERISA plans). For this type of insurance, lien obligations most often arise out of a contract between the client and health plan.