When your lawyer calls and says he has settled your case you want to know how much you will get. There are several steps he has to take before you will know. He has to know if you owe any money back to any of the insurance companies that paid for medical care or lost income. If your injuries are due to a car accident, then under Florida law you do NOT owe money back to your personal injury protection carrier for accident related bills. You may owe some if you had “Medpay” coverage. If your bills were submitted to Medicare then it has a right to get part of its money back out of the settlement.

Some accident victims have major medical insurance or disability insurance benefits with companies like Blue Cross-Blue Shield now called Florida Blue, or with United Health care. If the major medical policy is a part of a benefits package at work then there is a chance that your employer has set up an ERISA plan to help with a 401(k) and insurance benefits. ERISA plans may require dollar for dollar pay back. So, if there is a large chunk of money paid by your ERISA plan for major medical benefits then it may claim every drop of the settlement is owed to the plan administrator. Your lawyer should ask the administrator for plan documents to determine what the ERISA plan rights are against your settlement, and examine IRS filings.

I have represented clients with large medical bills. Their ERISA plan want ALL of their settlements, and do not even allow them to pay for my fees and costs, or court costs if we had to go to court. It is obvious that I would like to get paid and also that I want to put settlement money into my clients’ pockets rather than sending a large settlement to an ERISA plan administrator.

One of the things I have to check is IRS documentation available at It requires a free registration to get plan information about the ERISA plan. IRS requires annual filings of Form 5500 (and attachments) which show whether the employer is “self funded” or whether the employer has bought a group insurance policy. In the later case, the ERISA plan is subject to the Florida court rules. In the former it is bullet proof and it must be fully paid back.

Under Florida rules, if there is no ERISA qualified plan. a company claiming subrogation rights is NOT entitled to a lien against any money paid by UM carriers. It also has to pay a pro-rata cost of collecting the liability settlement. If the client pays me a 1/3rd contingency fee, then the insurance company has to give them a 1/3rd discount on the subrogation claim against the liability settlement. There is another loophole. If the subrogation documents do not waive the Florida “made whole doctrine” then you do not have to pay anything back to the insurance company for subrogation.

This whole area of subrogation, reimbursement and ERISA is a field of land mines with lots of booby traps and potential legal problems. Don’t try to navigate it on your own. Get a lawyer who knows what to do to protect your rights.

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