Who Pays Medical Bills After an Illinois Car Accident?

The short answer

After a car accident in Illinois, the driver who caused it is legally responsible for your medical bills, and their liability insurance pays them, but usually only once, as part of a final settlement or verdict. Until then, your bills are paid by whatever coverage you already have, such as health insurance or medical payments coverage, and those payers are typically repaid out of what the at-fault driver’s insurer eventually pays you.

This guide covers who pays in the meantime, who gets repaid from your settlement, and how Illinois limits those repayments.

Why the other driver’s insurer does not pay as you go

Illinois is a fault-based state. There is no no-fault personal injury protection that pays your bills regardless of fault. Instead, every vehicle must carry liability insurance under 625 ILCS 5/7-601, at no less than the minimums in 625 ILCS 5/7-203: $25,000 for injury to one person and $50,000 for everyone hurt in one crash.

That policy pays people the insured driver injures, but it pays to resolve a claim. The Illinois Department of Insurance explains that you must either accept a final settlement offer or file a lawsuit within the statute of limitations. In practice, the other driver’s insurer waits until it knows the full value of the claim and pays once.

Under the Illinois pattern jury instruction on medical expenses, IPI 30.06, a jury awards the reasonable expense of necessary care already received plus the present cash value of care reasonably certain to be needed in the future. That is one reason not to settle before your doctors know where your recovery is heading.

Who pays while your claim is open

Source	When it pays	Repaid from your settlement?
Your health insurance	As bills come in, under your plan’s normal terms	Often, if the plan has a subrogation or reimbursement right. Illinois law limits it (Section 50)
Medical payments coverage on your auto policy	As bills come in, up to your limit, even if you caused the crash	Depends on the policy wording
Medicare	Second, after liability insurance, but it may make a conditional payment	Yes. Medicare recovers conditional payments
Medicaid (HFS)	As bills come in	Yes. The state has a charge on your claim
Workers’ compensation (crash while working)	As bills come in, for all necessary treatment	Yes, from any recovery against the other driver
Hospital or doctor waiting to be paid	Does not pay; holds the bill and may serve a lien	Yes, through the lien, capped by 770 ILCS 23/10

Your health insurance

Use it. Your health plan generally pays crash-related treatment like anything else, subject to your deductible and copays. That keeps bills out of collections without lowering what the at-fault driver owes (see the collateral source rule below). Many plans claim a right to be repaid from your recovery, so ask for the plan document, not just the member card.

Medical payments coverage on your auto policy

The Illinois Department of Insurance lists medical payments coverage among the optional coverages you can buy for an extra premium. It is not required. If you have it, it covers medical and funeral expenses for you or your passengers in your vehicle, and covers you and family members struck as pedestrians or riding in another vehicle, and the Department notes that “this coverage pays even if you cause the accident.” Limits are usually modest, so check your declarations page.

Medicare and Medicaid

If you are on Medicare, the order matters. Medicare.gov says liability insurance pays first and Medicare pays second for accident-related care. If the insurer does not pay promptly, Medicare may make a conditional payment and recover it later, so plan on Medicare being repaid from any settlement.

If Illinois Medicaid paid, the Department of Healthcare and Family Services has a charge on your injury claim for the medical assistance it provided from the time of injury, under 305 ILCS 5/11-22.

Workers’ compensation, if you were working

A crash while driving for work is usually a workers’ compensation claim too. Under 820 ILCS 305/8(a) the employer pays for all necessary medical, surgical and hospital care. You can still sue the other driver, but Section 5(b) requires the employer to be repaid what it paid in compensation, including medical, out of that recovery, and the employer must pay its share of the costs of getting it. Our post on suing after a work injury explains how the two claims fit together, and our workers’ compensation page covers the comp side.

Hospital and doctor liens, and the 40% cap

Some hospitals and doctors wait for the settlement and assert a lien on it under the Health Care Services Lien Act, 770 ILCS 23/10. The Act gives physicians, hospitals, physical therapists, emergency medical services personnel and other listed providers a lien for their “reasonable charges,” with real limits:

• A written notice is required. The lien must be served on you and on the party you are claiming against, by registered or certified mail or in person. A good-faith payment made before the notice is served cuts off the lien to that extent.
• All liens together are capped at 40% of the verdict, judgment, settlement or compromise.
• No single category gets more than one-third. For example, all physicians together, or all hospitals together.
• When liens reach the 40% cap, health care professionals (such as doctors) share no more than 20% and health care providers (such as hospitals) share no more than 20%, with unused room reallocated between them.
• You must give notice before the money is paid out. Under Section 15, a settlement cannot be satisfied without first notifying each provider that served a lien.

Hypothetical figures applying the caps in 770 ILCS 23/10. The doctors’ $8,000 fits under their 20% share, so the $2,000 they do not use is reallocated to the hospital. Source for the remaining balance: 770 ILCS 23/45.

The cap is not forgiveness. Section 45 says a provider may still pursue the part of its reasonable charges left unpaid after its lien is satisfied. In the example above, the hospital can still try to collect its other $8,000 from you directly. That is why lien balances are usually negotiated before a settlement closes, not after.

Paying back your health insurer

Health plans that paid your crash bills usually claim reimbursement from the settlement, often called subrogation. Illinois puts two limits on that claim in 770 ILCS 23/50. If your recovery is reduced because of your own comparative fault, or because the other driver’s insurance was too small to pay the full value of your claim, the reimbursement claim “shall be diminished in the same proportion.” After that reduction, the insurer must also bear a pro rata share of your attorney’s fees and litigation expenses.

Say the court values your claim at $100,000, but the other driver had only a $25,000 policy. Your recovery is a quarter of the claim’s value, so a $12,000 reimbursement claim drops to $3,000, and the plan then shares the cost of getting that money.

Section 50 does not apply to everyone. It excludes Health Care Services Lien Act liens, workers’ compensation liens, and an insurer recouping uninsured or underinsured motorist payments. Some employer health plans are also governed by federal law and may argue their own terms control, so get the plan document early and have it reviewed before you agree to any repayment figure.

Can the other driver use your insurance to pay you less?

No. Illinois follows the collateral source rule. The comment to IPI 30.06, relying on the Illinois Supreme Court’s decision in Wills v. Foster, 229 Ill. 2d 393 (2008), explains that the rule prevents defendants from introducing evidence that your losses were paid, “even in part, by insurance,” and bars a court from reducing an award because of those benefits. The reasoning is that the wrongdoer “should not benefit” from coverage you arranged.

You may seek the amount originally billed if you show it is reasonable. A paid bill is prima facie evidence of reasonableness; an unpaid portion, including the gap between the bill and what your insurer paid, needs testimony about its reasonable value. The defense may challenge reasonableness, but not by showing the jury your bills were settled for less. Using your health insurance does not shrink your claim.

When the bills are bigger than the other driver’s policy

A short hospital stay can exceed a $25,000 policy. When it does, look at your own auto policy. Under 215 ILCS 5/143a, every Illinois auto liability policy must include uninsured motorist coverage at least at the 7-203 minimums, and underinsured coverage can add to a small policy. Our guides on how much uninsured motorist coverage to carry and suing an uninsured driver walk through those claims, and our uninsured motorist practice handles them.

Fault and deadlines still apply

• Shared fault. Under 735 ILCS 5/2-1116, your damages, medical bills included, are reduced by your percentage of fault, and you recover nothing if you are more than 50% at fault. See the Illinois 51% fault rule.
• Two years to sue for personal injury under 735 ILCS 5/13-202. Our post on the Illinois car accident statute of limitations covers when the clock starts.
• One year against a village, city, county or other local public body or its employees under 745 ILCS 10/8-101, for example a crash with a public works truck.

If the deadline passes, the bills remain and the claim that would have paid them is gone.

What to do this week

• Give every provider your health insurance, and ask whether they will bill it or hold the bill against your settlement.
• Open a med-pay claim with your own auto insurer if your policy has the coverage.
• Keep every bill, explanation of benefits and lien notice in one folder. Lien notices arrive by certified mail; do not ignore them.
• Request your health plan document and your full auto policy, not just the summary pages.
• Follow your treatment plan. Gaps in care give the insurer an argument that later treatment was not needed. Our checklist of what to do after a car accident in Illinois covers the rest.
• Do not settle until you know the lien and reimbursement totals and how much of them can be reduced.

Часто задаваемые вопросы

Talk to an Illinois car accident lawyer

Liens and insurance paybacks decide how much of a settlement reaches you, and Illinois law can reduce them if you act before you sign.

Lawyer Furqan represents people hurt in car accidents across Cook County, including Oak Lawn, Skokie and the surrounding suburbs.

Sources and authorities cited

• Health Care Services Lien Act: 770 ILCS 23/10, 23/15, 23/45, 23/50
• Illinois Vehicle Code: 625 ILCS 5/7-203, 7-601
• Illinois Insurance Code: 215 ILCS 5/143a
• Illinois Public Aid Code: 305 ILCS 5/11-22
• Workers’ Compensation Act: 820 ILCS 305/5, 305/8
• Code of Civil Procedure: 735 ILCS 5/2-1116, 13-202
• Local Governmental and Governmental Employees Tort Immunity Act: 745 ILCS 10/8-101
• Illinois Pattern Jury Instructions, Civil: 30.00, Damages (IPI 30.06 and comment, citing Wills v. Foster, 229 Ill. 2d 393 (2008))
• Illinois Department of Insurance: Auto Insurance Shopping Guide; Filing a Claim with Another Driver’s Insurance Company
• Medicare.gov: Who pays first

This article is general legal information about Illinois law, not legal advice, and reading it does not create an attorney-client relationship. Every claim turns on its own facts. Talk to a lawyer about yours.