Medical Payment Coverage: What Is It, and Do You Need It
A big concern after being hurt in an accident is how to pay for medical bills. One option is to add medical payment coverage to an auto insurance policy. This extra coverage, commonly known as MedPay, provides an additional source of funds for victims’ and passengers’ immediate medical needs. And unlike liability insurance, it doesn’t matter who was at fault.
Medical payment coverage can be useful even for those with generous auto and health insurance coverage. It is fairly inexpensive and can fill gaps left by other policies such as high deductibles or low coverage limits. Depending on what’s covered by your existing policies, adding MedPay might be worthwhile.
How Medical Payment Coverage Works
Liability insurance is mandatory in both Illinois and Missouri. But it only protects a driver by paying for damage when they cause an accident. The victims can receive compensation up to the at-fault driver’s policy limit.
Medical payment coverage is optional and is available in most states. Adding on MedPay offers protection to the policyholder and their passengers for personal injuries regardless of who caused the crash. Coverage also may apply to policyholders if they are hurt in someone else’s car, while riding a bike, or as a pedestrian.
- An at-fault driver can pay for their own medical bills with MedPay.
- MedPay can be used to cover any medical bills not covered by the at-fault driver’s liability insurance.
- A victim can use MedPay for out-of-pocket medical costs not covered by their health insurance, plus copays, and deductibles.
- Passengers of a driver with MedPay are covered for the same amount as the driver.
- In a fatal crash, MedPay can be applied to funeral expenses for covered drivers and their passengers.
Medical payment coverage tends to have fairly low payouts. Limits vary by policy but are typically between $1,000 and $10,000. Most policies allow the driver and each of their passengers to collect up to the policy limit.
What Does MedPay Cover?
Medical payment coverage can help pay up to the policy limit for most things that occur in personal injury cases, such as:
- Ambulance fees
- X-rays and tests
- Hospital stays
- Surgery
- Medication
- Doctor visits
- Physical therapy and rehabilitation
- Prostheses
- Medical equipment
- Health insurance deductibles and copays
- Funeral expenses
Pros, Cons, and Other Options
Medical payment coverage can supplement other insurance coverage at a reasonable cost. There are no deductibles like there are for health insurance policies and the money can be used for immediate medical needs. MedPay can even benefit drivers who caused a crash.
But personal injury cases often involve other expenses that a medical payment add-on will not cover such as:
- Lost wages for missing work
- Services that can’t be performed due to injuries such as housework, childcare, etc.
Compensation for these items can be included in an insurance claim or lawsuit against the at-fault driver and eventually be collected as part of a personal injury settlement.
For Illinois residents, there is another drawback of medical payment coverage. A victim must reimburse any MedPay funds they have used to pay for medical bills if those bills end up being covered by the auto insurer. In other words, they can’t take advantage of the coverage twice or “double dip”. In Missouri, however, there is no requirement for reimbursing MedPay money.
There are alternatives to MedPay that offer more protections to the policyholder. The most common are:
- Personal Injury Protection (PIP): PIP covers medical expenses, lost wages, and other damages. It too pays regardless of liability for the crash. Some states require PIP insurance, but it is optional in Illinois and Missouri.
- Uninsured Motorist (UM)/Underinsured Motorist (UIM): UM coverage protects drivers who are hit by someone without insurance and UIM covers those hit by drivers who do not carry enough insurance to cover all of an injured person’s expenses. Like PIP, it covers lost wages and other services while the victim recovers.
- Illinois requires drivers to carry both UM and UIM at an amount matching their liability insurance. (This amount is currently $25,000 for one victim and $50,000 per accident.)
- UM is mandatory in Missouri, but UIM is not. UM has the same dollar requirements as Illinois, but Missourians can multiply that limit by the number of cars covered in the policy. For example, a policyholder with three insured cars could potentially collect $75,000 if injured by an uninsured motorist.
An option other than medical payment coverage may have a higher limit and cover more expenses for the policyholder. It is best to consult with an insurance agent to fully understand any policy’s coverage.
How Medical Payment Coverage Affects Personal Injury Cases
A serious accident can result in thousands of dollars in emergency medical expenses as well as ongoing care while the victim recovers. An experienced personal injury attorney like Hipskind & McAninch can help with filing insurance claims to get full compensation, and if necessary file a lawsuit to reach a fair settlement.
Luckily, using funds from medical payment coverage does not harm an injured person’s right to pursue damages. Victims are entitled to compensation for their injuries when they are hurt in an accident that was not their fault, regardless of the type of insurance coverage they have.
When a car crash causes bodily harm, it’s best if the victim can concentrate on healing rather than worrying about how they will pay their bills. Because sorting out what’s covered under various insurance policies can get complicated, it helps to get the advice of an attorney to get what you’re rightfully owed. Contact Hipskind & McAninch to schedule a free consultation about your case.
Category:
Tags:
liability insurance, medical payment coverage, personal injury cases