What are your options if you can’t afford medical care while your personal injury claim is pending? You may need a letter of protection or “LOP” signed by your personal injury attorney, or you may need a pre-settlement advance from a settlement funding company.
A personal injury could happen to almost anyone at any time, and you do not have to be in a traffic accident or on a construction site. You could be attacked by a neighbor’s vicious dog or injured using a defective tool in your garage or a defective appliance in your home.
If you’re injured in any accident because someone else was negligent, seek medical help at once. After you have been treated by a medical provider, arrange a consultation with a personal injury lawyer. A first consultation with an injury lawyer is usually offered without cost or obligation.
What Does It Cost to Begin the Legal Process?
Almost all personal injury attorneys work on a contingent fee basis. If a personal injury attorney agrees to handle your case, you will pay no attorney’s fee unless and until your attorney recovers your compensation with a negotiated out-of-court settlement or with a jury verdict.
That is a big advantage, especially if you are injured or disabled and you’re unable to work. But even if your lawyer works on a contingency fee basis, if you are out of work for several weeks or longer, you’ll have medical bills piling up alongside your monthly obligations – and no income.
Do not put yourself at risk and let financial concerns keep you from the medical treatment you need. Some injury victims need treatment or surgery at once to avoid a permanent impairment or disability. However, personal injury plaintiffs who face financial hardships have several options.
Should You Obtain a Letter of Protection?
A letter of protection is a binding legal document that can be prepared by your personal injury attorney. It is an agreement between you and your health care provider which guarantees that payment for your medical services will be made from your personal injury settlement.
An LOP is a legally enforceable “IOU” that lets you receive medical treatment while your injury claim is pending. Especially if you were catastrophically injured or disabled by someone who was negligent, a hospital may not accept that party’s insurance coverage to guarantee payment.
Your injury claim could be rejected or challenged. The negligent party’s insurance company may be establishing a negotiating position, or it may even be operating in bad faith. Hospitals and doctors typically require a legally enforceable guarantee that they will be paid for their services.
There is no legal requirement that compels a hospital or a doctor to accept your letter of protection. However, most health care providers who routinely treat accident victims also routinely accept letters of protection and provide medical services and treatment on that basis.
How Do LOPs Work?
When doctors and hospitals receive letters of protection from personal injury attorneys, they’re expected to provide personal injury victims with medical care and treatment with a presumption that the services will be paid for when the victim’s personal injury claim is resolved.
However, if there’s a difficulty with your claim or settlement negotiations, or if for any reason your claim does not prevail in a personal injury trial and you are not compensated, you are still legally and personally responsible to pay for medical services that were provided under the LOP.
In other words, a letter of protection can help you receive the medical care and treatment you may need, but it will not pay the doctor bills or the hospital bills.
Is an LOP the best way to avoid financial hardship – and obtain the medical services you need – while your personal injury case is pending? Before you ask your personal injury attorney to prepare a letter of protection, talk with that attorney about your other options and alternatives.
What is a Pre-Settlement Advance?
A conventional loan from a bank or another financial institution obligates you to make monthly payments and pay exorbitant interest. However, there’s a third option. A pre-settlement advance from a settlement funding provider may be available to you for one flat fee.
You pay off a pre-settlement advance in one lump sum, when you receive your compensation at the end of the personal injury process, so there’s no compounding interest or ongoing obligation.
Perhaps the biggest advantage of receiving a pre-settlement advance is this: If for any reason you don’t receive the compensation and settlement that you and your attorney anticipate, a pre-settlement advance does not have to be repaid. The settlement funding company takes the loss.
How Do Pre-Settlement Advances Work?
Applying for a pre-settlement advance costs nothing. You must have a pending lawsuit filed, and before approving your application, the settlement funding provider will discuss your case with your personal injury attorney to make certain that pre-settlement funding is right for you.
Because there’s no long-term obligation, there’s no credit or financial background check, and you don’t need to be employed. When your case concludes, your lawyer will pay off the funding company, deduct any lawyer’s fee, and transfer the remainder of your compensation to you.
Pre-settlement funding is a way to obtain the medical care and treatment you need while your personal injury case is pending, and you don’t have to worry that you’ll be “on the hook” personally for that care and treatment if your injury claim does not prevail.
In other words, a pre-settlement advance can accomplish exactly what a letter of protection can accomplish – help you receive the medical services you need – but without the risk that a letter of protection entails.
What Else Should You Know About Pre-Settlement Advances?
A funding company will consider a number of factors when it decides how much it will offer you with a pre-settlement advance.
However, when a personal injury claim is persuasive and likely to prevail, a funding company is more apt to approve an advance and offer a personal injury victim the immediate cash necessary for prompt medical care and treatment.
Learn more about pre-settlement advances – without cost or obligation – by discussing your case and your needs with a funding professional. If your claim is pending but you need medical treatment and services now, make the call immediately.