An Act concerning equitable allocation of recovery proceeds for subrogation claims
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed House
- Passed Senate
- To Governor
- Became Law
Overview
This bill aims to ensure a fairer distribution of recovery proceeds when an injured person receives compensation from a third party for their injuries. Specifically, it addresses how attorney’s fees and costs related to obtaining judgments or settlements are divided between the injured person, health maintenance organizations, hospitals, and medical service corporations. The bill also limits the subrogation rights of insurers to the extent of their actual benefits provided, and establishes a process for courts to review settlement agreements to ensure they are equitable.
Key provisions
- Any attorney’s fees and costs related to obtaining judgments or settlements are divided proportionally between the injured person, health maintenance organizations, hospitals, and medical service corporations based on the amount each received.
- Insurers’ subrogation rights are capped at the amount of benefits they provided, preventing them from claiming more than their share of the recovery.
- A process is established for courts to review settlement agreements to ensure they are fair and reasonable, particularly when the settlement amount is less than the total damages.
- The injured person can petition the court to determine the reasonableness of a settlement and the fair allocation of funds.
- If a settlement or judgment is less than the injured person’s total damages, the court can reduce the amount of the lien.
- Parties can withdraw consent to a settlement if they are dissatisfied with the proposed apportionment.
Bill text
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Sponsors
Official sponsors from legislative records.
2 on record
Primary sponsor
Joint Committee on the Judiciary
Cosponsor
Jeffrey N. Roy
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