By Reid Zeising, CEO and Founder, Gain Servicing
This little known stat will blow your mind: A published analysis of Illinois personal injury claims found that healthcare providers collected just 51% of billed charges. The other 49% never came in.
In that analysis, nearly half of the money billed for personal injury care never reached the providers who delivered it. And yet the healthcare providers working in this space keep treating patients anyway, often for months before a case settles, carrying the full weight of that financial uncertainty on their balance sheets.
In the Illinois analysis, the collection rate for personal injury claims was 51%, and the average active claim remained in collections for 764 days. It’s been this way for years. And somehow, almost nobody in healthcare or legal talks about it.
What a 51% Collection Rate Actually Means
In almost any other industry, collecting just 51 cents on every dollar of services rendered would be an emergency. Businesses do not survive long with those economics unless they have built the model around absorbing those losses, which is exactly what has happened here.
Providers who treat personal injury patients on a lien or letter of protection are doing so with the understanding that payment depends on case outcome. If the case settles, they get paid, sometimes at a reduced rate after negotiation. If the case does not settle, or settles for less than expected, or drags on long enough that the economics no longer work, providers absorb the shortfall.
That is not a collection problem in the traditional sense. It is not about billing codes, denial management, or appeals. It is a structural problem built into how the system assigns financial risk. And right now, a disproportionate share of that risk lands on the people delivering care, not on the insurers who are ultimately responsible for making injured patients whole.
Providers Are Absorbing Losses the System Assigned to Someone Else
When someone is injured in an accident, the legal obligation to pay for their care belongs to the at-fault party or, in most cases, that party’s insurer. That is how liability works. The person who caused the harm is responsible for the consequences.
But the party responsible for paying is often the last to write a check. Insurance companies operate on delays. They dispute liability. They dispute the necessity and reasonableness of treatment. They make reduction requests. They wait. And while they wait, the provider who treated the patient has already absorbed the cost of that care.
The provider paid for the physician’s time. The provider paid for the imaging. The provider paid for the staff, the facility, the equipment, the administrative overhead of managing a lien portfolio with an uncertain collection timeline. All before any insurer issued a payment or a settlement was reached.
This means providers are, in practice, providing interest-free financing to the personal injury ecosystem. They are carrying the cost of care on their books, often for years, while the insurance industry holds its position and negotiates from a posture of time. The insurer waits on purpose. Delay, deny, defend is the process.
The broader pattern of uncompensated care in American healthcare gives this problem context. The American Hospital Association reports that U.S. hospitals have provided over $620 billion in uncompensated patient care over the past two decades. Personal injury lien losses are a distinct category within that universe, but they share the same root cause: a system that routinely transfers financial risk from payers onto providers.
The Wait Is Not Measured in Weeks
It’s common to underestimate how long personal injury cases take. The Bureau of Justice Statistics reports a median resolution timeline of 13 to 14 months once a lawsuit is filed, with ~44% of cases closing within one year and 74% within two. Those numbers cover the full range. What they average out of view are the cases involving serious injury, disputed liability, or insurers who have calculated that time is on their side. The Journal of Urgent Care Medicine notes that personal injury cases involving significant treatment can stretch well beyond average timelines, and complex matters like medical malpractice routinely run to 30 months or more. For a provider carrying a lien portfolio, the difference between a 12-month case and a 30-month case becomes an operating capital problem.
During that entire window, the provider’s accounts receivable is essentially frozen. The money is not coming in. The expense side of the ledger does not pause to match.
Payroll runs every two weeks. Rent is due every month. Equipment financing is not suspended because a lien portfolio is aging. Malpractice insurance, supplies, facility costs, the salaries of staff who manage the administrative burden of tracking these cases: all continues at a normal pace. The revenue does not.
For smaller practices, particularly chiropractors, orthopedists, imaging centers, and physical therapists who treat a high volume of personal injury patients, this mismatch between expense timing and revenue timing can create serious operational pressure. It has forced providers to limit how many PI patients they take, exit the space entirely, or sell their receivable portfolios at a discount just to keep the lights on.
I wrote about where that trajectory leads in “What Will Happen When Healthcare Providers Stop Accepting Lien Cases,” and the downstream effects are not abstract. When providers walk away from lien-based care, patients lose treatment access. Attorneys lose the medical records that support their cases. The entire ecosystem suffers.
None of those outcomes are good for patients. And none reflect anything wrong with the care those providers are delivering.
This Has Been Acceptable for Too Long
Providers have been absorbing these dynamics for decades. Providers who wanted access to that patient population accepted that they were taking on financial risk. And many of them built practices that could carry that risk, at least in normal conditions.
But the environment has gotten harder. Inflation raised operating costs across healthcare faster than reimbursement rates followed. Staffing pressure has not let up. Administrative complexity in PI billing has grown. And the time-to-settlement dynamic has not improved. If anything, it has stretched longer in many markets as case volumes increased and litigation timelines extended.
Kaufman Hall’s latest hospital flash report, drawing on Strata Decision Technology data, found bad debt and charity care per calendar day increased 32% between 2022 and 2025. Becker’s Hospital Review reported bad debt deductions among health systems rose 9.2% in the first quarter of 2025 alone, up roughly 17% since 2023. Those figures cover the full healthcare landscape. The PI lien segment, where collection uncertainty is structural and payment delays are measured in years, is among the most exposed.
The math that once made lien-based practice workable for providers is under real pressure. The collection problem is not new. Neither is the duration problem. In the Illinois analysis, active PI claims remained in collections for an average of 764 days.
This dynamic does not exist in isolation from the broader insurance access problem either. The growing gap between coverage and actual access to care means even patients with insurance are increasingly struggling to meet out-of-pocket costs. Providers are being asked to carry more financial risk while patients have less capacity to absorb it.
The System Is Starting to Respond
The good news, and there is some, is that the market is generating solutions to a problem that policy has largely ignored.
Medical receivables financing has grown into a real industry because the underlying need is real. Providers who treat personal injury patients now have options beyond waiting for cases to settle. They can access lien purchase programs that provide immediate liquidity, or partner with servicing platforms that handle the administrative burden of tracking cases, managing attorney communications, and processing settlements when they arrive.
Pre-settlement funding creates a parallel liquidity mechanism for plaintiffs, which means patients can sometimes access care faster and build a more complete medical record, which benefits providers and attorneys as much as it benefits the patient.
Case management technology has improved dramatically. The tools that reduce administrative friction in healthcare are already operating inside the market. Providers no longer must rely on spreadsheets and phone calls to track where their lien portfolio stands. The information is more accessible, the workflows are more automated, and the ability to manage a large PI caseload without proportionally large administrative overhead is improving.
These are real changes. They do not fix the structural problem entirely, but they reduce the penalty providers pay for participating in a system never designed with their financial stability in mind.
What I Know for Sure
Providers who treat injured patients are performing a function that the entire personal injury ecosystem depends on. Without them, there is no documented medical record. There is no foundation for a claim. There is no evidence of harm. Attorneys cannot build cases. Plaintiffs cannot access compensation. Insurers, for all their delay tactics, eventually have to settle cases, and that requires a medical record to negotiate against.
Providers make that record possible. They deliver the care. They absorb the financial risk. In the published Illinois analysis, providers collected just 51 cents of every dollar billed for personal injury care. The remaining 49 cents never came in.
That is not sustainable. And the conversation about fixing it needs to happen more openly than it currently does.
Providers should not have to choose between treating patients and staying solvent. Those two things should not be in conflict. The fact that they are is a system design problem, and it is one that the legal, financial, and healthcare communities have both the incentive and the tools to address.
My plea? Get honest about the numbers. A system where providers collect just 51% of billed charges in a published PI analysis is not simply a billing problem. It is a structural failure.
Source: “The Three D’s of Insurance: Delay, Deny, and Do Not Pay,” an Illinois-based analysis published in the MedCrave Online Journal of Orthopedics & Rheumatology. The study found a 51% personal injury collection rate, 49% of claims never paid, and an average active-claim collection period of 764 days.