In February 2007, I was rear-ended while stopped in the street with my turn signal on. The vehicle that rear-ended me had flown around the curve going ten miles over the speed limit and sent my car flying forward.
I sustained injuries, which I still have. At the time my doctor found a great treatment for damage to nerves in my neck. Even better, I had fantastic health insurance, a relief as his treatment was very expensive.
Six months later, I got a HUGE bill in the mail from that doctor.
My health insurer made the doctor pay them back every dime, and now I was stuck with a giant bill.
The simple reason? Usually your personal health insurance won’t cover ANY medical expenses related to a car accident. As I learned, even if your health insurance pays initially, they can take back what they paid in the past.
Given the cost of healthcare, there’s no reason to risk not having medical coverage on your auto insurance.
What Is Medical Payment Coverage?
Medical Payments is a first party benefit that coverings medical expenses that are a consequence of an accident, regardless who is at fault. It will pay for the insured, passengers, and you. It will also cover you if you are injured as a pedestrian or riding a bicycle.
You can use it regardless of who is at fault in an accident. If the accident wasn’t your fault, you may be apprehensive about making a claim for it, but you don’t have to be.
When I had my car accident, I made a medical payments claim on my policy—but only after my attorney assured me it was allowed. At the time, I had a clear driving record. But as my lawyer said, it’s coverage for you, YOU pay to have it, and you’re entitled to it if you’re injured. Better yet, it won’t affect premium. If your insurer pays when it wasn’t your fault, they’ll subrogate—seek reimbursement from the at-fault party’s insurer.
Coverage usually ranges from $500 to $10K, although the most common amount procured is around $1K. Medical payments doesn’t have a deductible.
You shouldn’t confuse bodily injury coverage (BI) (part of your liability coverage) with medical payments either. BI doesn’t cover you, passengers, family members, or household members.
Is This Coverage Available to Every Insured?
Be sure to read the exact coverage definitions for your policy. Each state, and even different insurance companies, has different terms for coverage. Some states require Personal Injury Protection (PIP), and Medical Payments may not be an option.
Also, some insurers only allow you to purchase it if you carry comprehensive and collision coverage or just have a named non-owner policy or liability only.
What’s Covered and What’s Not?
In general, medical expenses resulting from an accident will cover doctor bills, X-rays, prostheses, funeral costs, surgery, ambulance, and EMT bills, at the least.
Also, health insurance may not pay for ambulance fees or EMT fees. Medical Payments on your car insurance will cover those costs for you.
Policyholders, passengers, and family members are covered. If you have people in your car regularly, consider this– if you cause an accident and your passenger is injured, they may sue you, especially if you were negligent. There have been cases of a spouse suing their own spouse who was driving when the accident occured, so if you think your BFF won’t sue you, think again.
If your passenger is injured, and your medical payment coverage is high enough to take care of all their medical bills, they’ll be much less likely to sue you. Another added bonus is that you’re covered regardless of fault. Even if you’re alone and crash into a tree, you can still claim medical pay if injured, and you may be covered if a vehicle hits you when you’re bicycling or walking.
Why Should You Consider Medical Payments?
First, check with your private health insurer to see what their policy on auto accident payments are, and then you can make an informed decision about medical payments.
If they’ll cover car accident expenses, consider the health insurance deductible you’re required to pay at the emergency room or if you’re admitted to the hospital. Even if you have great healthcare, you would have to pay your $2K deductible for in-patient care, or $1K for emergency room services, 100% out of pocket. If you weren’t at fault, this can be inconvenient and you’ll need patience.
Medical Payments would be a good option if you rarely carry other passengers in your car. If there’s an accident and a passenger is injured, your employer-sponsored health care won’t cover them.
How Much Should I Carry?
Some people only carry enough to cover their health insurance deductible, and sometimes, enough to cover their comprehensive or collision deductible. If your health insurer won’t pay for medical bills from the accident, obtaining enough coverage to meet your deductible is superfluous.
Keep in mind though—MedPay is ONLY for medical bills, and it’s considered insurance fraud is the money is used for other expenses.
Also, if your health insurance doesn’t cover medical expenses from car accidents or if you don’t have any health insurance, opt for the highest Medical Payments limits available.
Read all the details of your coverage. There are some companies that use a reimbursement clause or a provision for duplicate payments—meaning if you win a lawsuit covering medical expenses you claimed, you’ll need to pay them back. You may need to pay it back if your Uninsured or Under-Insured Motorists Coverage paid out also.
Medical payments isn’t a lot more to have either—sometimes you can even get up to $10K in coverage for less than $20 monthly.
Take it from my experience—learn what both policies cover, their limits, and only choose the healthcare you know you can undoubtedly afford. Do this and you’ll never have to open another huge medical bill again from a doctor that you thought was paid long ago.
Follow Desiree on Twitter @DesireeBaughman.