Will Filing a Medical Malpractice Case Affect My Health Insurance Coverage?

Medical procedures are stressful even when everything goes right. However, anxiety can quickly escalate when things go off-script—especially when your problems directly stem from someone else’s fault or negligence.

Medical malpractice occurs when someone is directly injured because their doctor or healthcare provider did not meet a certain standard of care. These errors can include misdiagnosis, prescription mishandling, and surgery complications, causing further injury, mounting medical costs, and even death.

Unfortunately—despite these injuries—many eligible patients choose not to pursue a medical malpractice case. One of their biggest concerns? That filing for medical malpractice will have a detrimental impact on their health insurance coverage.

What Does Michigan Law Say About Health Insurance and Filing for Medical Malpractice?

Health insurance is designed to offset the cost of maintenance healthcare and any unforeseen medical needs that might arise. These plans don’t discriminate against the type of care you need and will usually cover ongoing needs.

However, health insurance generally doesn’t cover the cost of filing for malpractice, and plans often contain hidden limitations and stressful renewal requirements. Hence, it’s understandable why patients worry about how filing for malpractice will affect their monthly premiums.

The good news is that Michigan law prohibits health insurance providers from canceling coverage or increasing rates because a client filed a malpractice claim. However, while this might shield you from direct impact, filing a claim can indirectly affect your health insurance coverage.

Here’s what you need to know about some indirect effects and what an experienced attorney at Sommers Schwartz can do to protect your rights during this complex process.

Settlement or Judgment: An Increase in Income Equals Increased Rates

While Michigan insurance providers are prevented from adjusting coverage or increasing rates solely because you filed a lawsuit, this doesn’t mean your rates won’t be affected at all.

This is because health insurance providers calculate monthly rates based on several individualized factors, including: 

• Age.
• Location.
• Tobacco and drug use.
• Consumer income.
• Number of household dependents.

A significant payout from either a final judgment or a settlement agreement could be enough to raise your overall income level. And since income is one of the determining factors in estimating rates, your monthly premium might also increase.

However, it’s important to note that if an insurance provider has been paying your medical bills, they’ll likely be entitled to at least part of your payout before the money comes to you. This reimbursement can be secured through a lien against your settlement and can drastically affect your overall payment amount.

Health insurance disputes are common during malpractice suits, which is why it’s so important to have a dedicated attorney looking after your interests.

Reputation and Risk Assessment: Are You Likely to File Another Claim?

Insurance providers like boring clients. Boring clients are healthy, pay their premiums on time, and don’t bother them with malpractice lawsuits. What they don’t like is unpredictability. And having to cover medical expenses through an ongoing malpractice lawsuit—with no guarantee they’ll recoup their losses—is unpredictable. Therefore, your history of filing lawsuits is another indirect impact of malpractice on insurance.

Are you the kind of person who sues every other doctor in your contacts list? Do you have ongoing problems that might make malpractice more likely to happen again? Or is this a one-time occurrence?

Risk analysis is a huge part of determining someone’s coverage, and a lawsuit (or two) in your medical history might make future providers think twice before covering you. Depending on your case’s outcome, even one malpractice suit could land you in a high-risk category, resulting in higher premiums and making it difficult for you to obtain coverage at all.

The best way to avoid these potential pitfalls is to have an experienced, knowledgeable attorney on your side so you aren’t unfairly penalized for someone else’s negligence.

Let Sommers and Schwartz Handle Your Medical Malpractice Claim

As a patient, you have a right to receive fair coverage from your health insurance provider and shouldn’t be penalized for pursuing malpractice damages. For more information about how malpractice can indirectly affect your health insurance coverage—and what we can do to protect your interests—contact Sommers Schwartz today for a free consultation today, and let our team of highly experienced attorneys fight for your rights every step of the way.