The details of your personal injury settlement play a big role in how the insurance company values your claim.
A personal injury settlement is a legal term for an injury to the body, mind or emotions, as opposed to an injury to property. In common-law jurisdictions the term is most commonly used to refer to a type of tort lawsuit in which the person bringing the suit (the “claimant” in English Law or “plaintiff” in American jurisdictions) has suffered harm to his or her body or mind.
Personal injury lawsuits are filed against the person or entity that caused the harm through negligence, gross negligence, reckless conduct, or intentional misconduct, and in some cases on the basis of strict liability. Different jurisdictions describe the damages (or, the things for which the injured person may be compensated) in different ways, but damages typically include the injured person’s medical bills, pain and suffering, and diminished quality of life.
A key component of a personal injury settlement claim is the injured person’s “medical special damages,” which just means the amount the claimant spent on medical bills while having their injuries diagnosed and treated. Medical specials are part of the personal injury compensation formula that many insurance companies use to figure out a claimant’s total losses. The formula depends on a number of key factors, including the type of medical treatment you receive, and the kind of medical providers from whom you receive that treatment. (On a related note, learn how the nature and extent of your injuries affects the value of your personal injury case.)
TREATMENT FOR A PERSONAL INJURY SETTLEMENT
According to insurance adjusters, not all medical services are created equal when it comes to figure out the value of a personal injury settlement claim. Let’s take a closer look at some of the variables.
Treatment versus diagnosis
Before you can be treated for an injury, medical personnel have to diagnose it. In many cases, the diagnostic process is relatively quick, and the charge for it amounts to a small part of your medical bills, as compared with the cost of treatment. In such cases, insurance companies do not usually bother to make any distinction between diagnosis and treatment. They lump all your medical bills together into one medical specials amount.
M.D.s and hospitals versus non-M.D.s
One of the insurance industry’s strong prejudices is in favor of mainstream treatment by physicians, hospitals, and medical clinics—and against physical therapy, chiropractic, acupuncture, and so-called “alternative” medicine. Any medical bill you have incurred at the hands of a medical doctor, hospital, or medical clinic, no matter how outrageously expensive, will be considered legitimate by almost any insurance adjuster and will usually be given a high multiplier in the damages formula. Treatments by nonphysician medical providers are often equally effective and much less costly, but insurance adjusters tend to apply lower multipliers. (Learn more about how an insurance adjuster determines a personal injury settlement offer.)
For example, in accident-related injury claims, physical therapy is a common treatment, yet it is generally considered to be lower in the pecking order than other kinds of medical treatment. If you receive a few weeks of physical therapy prescribed and administered by your doctor’s office, an insurance adjuster may lump it in with other medical specials. But if you have physical therapy for months and the therapy accounts for the largest part of your medical bills by far, the insurance adjuster is likely to use a lower multiplier when plugging your medical specials into the damages formula.
Treatments by chiropractors, acupuncturists, herbalists, massage therapists, and other alternative healers
Unless bestowed with the rare blessing of a doctor’s prescription, other nontraditional treatments are given even less weight than physical therapy. This does not mean that you cannot be reimbursed at all for these treatments by the liable person’s insurance company. But it does mean that the insurance adjuster handling your claim will not count these expenses very highly when deciding how to multiply medical specials within the damages formula.
Of course, your primary concern should be to obtain the kind of medical care with which you are most comfortable and that you think will help you most. But you should be aware that if you choose services not provided by a physician, an insurance company is likely to compensate you at a lower rate.