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LETTERS OF PROTECTION IN PERSONAL INJURY CASES
Letters of Protection and Medical Care
LOP’s
(Letters of Protection)
A Letter Of Protection, usually referred to as a “LOP,” is a contract between an attorney and a doctor or medical provider to secure medical care for an injured person. Patients/Clients often sign them as well, agreeing to pay the medical bills in the event they do not recover sufficient funds in a legal case. The LOP usually states that the doctor will be paid out of any funds resulting from a personal injury insurance settlement or lawsuit award in a patient’s legal case. The medical provider agrees to provide medical care, keep accurate records, and stay in contact with the attorney. The contract also usually provides that the medical provider will be paid before the funds are distributed to the patient/client.
Why have a LOP? Why would a doctor or other medical provider want any part of such a thing?
LOP’s help patients with insufficient or no insurance obtain medical care for their injuries. This is the most important thing to everyone. In fact, even if the patient is well insured, the insurance company may drag its feet on paying medical bills if it thinks another party may be liable.
Medical providers are more likely to receive closer to their billing amount. Insurance companies rarely pay anywhere near the full bills that providers submit.
Also, the attorney-doctor relationship created by the LOP makes it easier for the doctor to share and the attorney to be aware of the current state of the client’s health and amount of the medical bills. This plays a huge role in in how much the attorney will be able to recover for the patient.
Why be leery of LOP’s?
There are a few cautions for the medical provider regarding the LOP.
Medical providers are dealing with an attorney, so it is wise to have their own attorney at least look over the contract to make sure the providers’ interests are protected.
The reasonableness of the medical bills must be monitored and maintained. An insurer challenging your bills will be especially interested in care that includes extensive physical therapy visits, particularly if they occur at the doctor’s office. Steroid injections and opioid based pain management are some treatments insurers particularly look at. Reasonable and necessary is the standard upheld by the Texas Supreme Court in support of personal injury damages awards.
Even though the medical office will likely receive more under a Letter of Protection than from an insurer, providers should still expect to negotiate some reduction in bills.
STAY IN CONTACT WITH THE ATTORNEY. The Medical provider must stay in contact and keep the attorney updated regarding the health of the patient/client and the current amount of the medical bills. The attorney is basing the claim largely on the short and long term prognosis of the patient and on the amount of the medical bills so it is important to regularly send them to the attorney. I’d even recommend sending them as they are accrued. I’ve not seen a patient have a problem with that.
I also highly recommend that the patient’s file not be segregated in any way but that it contain some designation that the patient is being treated under a LOP so that your system does not trigger sending bills to the patient. Medical providers should make sure all billing staff are aware of any LOP’s. An injured person receiving bills when they understood they would not, is very, very stressful for them.
And, lastly, the medical provider must be aware that it may take up to a year to get paid for their services. If the case goes to trial or there are hotly contested legal issues, it can take a year for the case to run its course. Typically though, LOP’s do not become legal case fodder. Typically, everyone does what they are supposed to do and medical bills are paid within a few months because the legal case settles and the insurance company(ies) involved pay the claim.
My opinion of LOP’s? I find them to be a very good tool for enabling necessary medical care for an injured person and beginning a paper trail to support the reasonableness and amount of any medical bills. This paper trail becomes a huge part of a personal injury lawsuit.
However, I have had to sue an attorney on behalf of a doctor because the attorney did not pay the doctor’s bills. The attorney asserted she didn’t receive the bills until after the money was distributed. We prevailed at a jury trial where a large part of our arguments centered around showing that communication lapses were not the fault of the doctor’s office.
So, bottom line, LOP’s, in the words of Martha Stewart, are good things, but they do require that the doctor stay in contact with the patient’s lawyer, keep meticulous treatment and billing records, and be aware that the reasonableness of any treatments will be scrutinized as part of any legal case.