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What is Subrogation?

If you have been injured in an accident that is the fault of someone else, you will probably come across the term "subrogation."  Subrogation simply means substitution of one person for another.  In the legal context, a health insurer stands in the "shoes" of the injured person and demands repayment of the money it spent on medical bills.  Subrogation issues typically arise when an individual is injured due to the negligence of another, receives medical treatment, and the medical bill is submitted to and paid for by the injured person's health insurer, workers compensation insurer, or by a government agency such as Medicare or the VA system.

These sources of payments are many times referred to as "collateral sources."  When the medical bills are paid by someone other than the at-fault party, i.e., a collateral source, the collateral source is typically entitled to reimbursement for what it paid.  Most injured people balk at the very thought of giving money back to a health insurer- after all, part of their hard-earned paycheck goes toward payment of health insurance premiums.  Unfortunately, the law of subrogation most times dictates that such reimbursement to the health insurer must occur. 

There are situations where an experienced personal injury attorney can help you either get subrogated amounts reduced, or eliminated altogether.  Hiring a lawyer who has experience dealing with the complexity of subrogation is very important and can maximize your recovery at the time of settlement.