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Legal Ethics/Attorney Fees and Subrogation

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Question
We have a personal injury case in progress. The medical provider has already agreed that their staff was negligent.  He died shortly thereafter.  The attorney is to receive 30% of the settlement. The medical insurer has already sent us a letter saying if money is awarded, they will seek subrogation.  I understand the subrogation part.  If I have not paid the attorney fees because they only get paid if there is a settlement, what happens if the medical insurer takes the total amount of the settlement.  Is it possible that I could end up paying the lawyer out of my pocket, even though I didn't actually receive any money, or had to surrender the money to the insurance company?

An example, in nice round numbers.....additional medical expenses incurred are $150,000.  Settlement/award is for $100,000.  Attorney fees are (at 30%) $30,000.  Insurance company says, because we paid out 150 and you got 100 we will take the 100 to offset our loss.  Or does the attorney get paid first and the insurance company reimbursement comes out of what is left.

I understand they may take it all and that I may not get any cash out of this at all.  I just don't want to come out of it owing money.

If a settlement is received will it be paid directly to me and then the insurance company would seek reimbursement from the estate? (me - as the executor)

hope that all makes sense.  Looking forward to your reply.

Answer
Jenny,

Part of the reason you hire an attorney is to negotiate all liens, inlcuding healthcare and health insurance liens.  

You are in control of the settlement.  Before you agree to settle or sign the release, ask for the final breakdown.  You would not agree to settle if you have to come out of your pocket and you certainly deserve some money as opposed to your attorney taking all of your funds.  If you are not in agreement with the final breakdown, do not agree to settle or sign the release.

Very truly yours,

Paul D. Friedman, M.A., Ph.D., J.D.

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Paul D. Friedman, M.A., Ph.D., J.D.

Expertise

I have been a practicing civil trial attorney since 1989 and have a master's degree in bioethics and a doctorate of philosophy in comparative ethics of law, medicine and business.

I am Certified as a Civil Trial Specialist by the National Board of Trial Advocacy and am Certified as a Specialist in Injury and Wrongful Death Litigation by the State Bar of Arizona Board of Legal Specialization.

I can answer questions dealing with general ethics principles, including legal ethics, medical ethics, bioethics and business ethics. I do not give legal advice over the internet.

For more information, you can view my website at WWW.EXPERTETHICS.COM

Experience

Experience in the area
I have been a practicing trial attorney since 1989 and I have a masters degree in bioethics and a doctorate of philosophy regarding comparative ethics.

Organizations belong to
State Bar of Arizona
State Bar of Colorado (inactive)
District of Columbia Bar (inactive)
Federal Bar
Licensed in Arizona District Court
Licensed in Ninth Circuit Court of Appeals
Licensed in the United States Supreme Court
American Bar Association
National Board of Trial Advocacy
American Association for Justice
Arizona Trial Lawyers Association
American Society for Bioethics and Humanities
Kennedy Institute of Ethics
National Association of Realtors

Education/Credentials
Bachelor of Arts 1985
Juris Doctorate 1989
Master of Arts in Bioethics 2004
Doctorate of Philosphy 2006

Awards and Honors
Phi Beta Kappa
Multiple Who's Who

Publications
A list of my copyrighted publications and presentations is contained at WWW.EXPERTETHICS.COM

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