Good News! Arizona Law Revises Health Care Liens!

On July 6, 2022, Governor Ducey signed into law Arizona Senate Bill 1021, which dramatically alters Arizona health care liens in ways that will be very beneficial to those injured as a result of the negligence or wrongful conduct of others. Some of the highlights of this new law are:

1) An exemption for one-third of any third-party judgment, settlement or award from any authorized lien or assignment.
2) The health insurance contract must expressly allow the health care provider to assert an authorized lien or assignment if the injured person is covered under a health insurance or medical benefit plan and the provider has a valid and binding contract with that insurer or plan as an in-network provider, and without that contract provision the lien or assignment is invalid and unenforceable.
3) The lien or assignment restrictions do not affect the rights of a health care provider to enforce a consensual agreement against the patient who has signed the agreement.
4) Requires all interested parties to compromise any lien or assignment and the amounts owed in accordance with any such lien or assignment to provide a settlement of the claim that is fair and equitable. Prescribes factors that a health care provider must consider in determining the extent of the required compromise.
5) Directs the patient, on request of the health care provider to provide a proposed distribution list of the settlement monies including the amount the patient would receive if the liens are
6) Specifies a health care provider lien or county assignment does not extend to medical
payments coverage. This provision was enacted to counter Dignity Health v. Farmers Ins. Co. of Arizona, 247 Ariz. 39 (App. Div. 1 2019).
7) Applies the health care provider lien restrictions and compromise requirements to liens that are filed for services that are provided beginning January 1, 2023.

This is good news for personal injury cases! In a number of cases, health care liens can absorb a significant amount of the settlement or judgment. With the passage of this new law, our clients should retain a greater portion of their settlement or judgment. More information may be found at SB 1021 Summary.

Feel free to contact us for more information. We remain the Verde Valley’s choice for personal injury representation.