Why Medical Providers Should Not Become Medical Funders

It’s no secret that medical care is considerably expensive, especially if that care is administered during an emergency after an accident. The burden is even more overwhelming for those who have been injured and don’t have health insurance or have insurance that has a high deductible.

What Is a Medical Lein?

It can be tempting in this kind of financial pinch to turn to anyone for help, including the medical providers themselves. Over the past few years, Felton Banks PLLC, a North Carolina-based law firm, has been calling this practice “medical lien funding.”

Medical providers who are owed money for services rendered can claim a lien against your recovery if they:

  • Provide notice of the lien
  • Provide medical bills for free
  • Provide medical records for free

So, you can probably see how this can be beneficial to patients who suffered an unexpected injury. Basically, these laws allow medical providers to treat you today and secure payment for that treatment once you settle your personal injury claim. This is a huge relief for injured patients who can’t afford to pay out-of-pocket for their treatment, and it makes the process more manageable for everybody involved.

However, not all medical liens are non-recourse. The point of view Felton Banks is sharing above is specific to North Carolina law. For instance, the state of Texas passed paid versus incurred legislation in which healthcare providers currently holding liens cannot do so because they have determined healthcare providers are not businesses and should not be governed, in this instance, like businesses.

There are countless other examples of the complexity of medical funding and whether or not they should be non-recourse in nature, including the Michigan Covenant Medical Center v. State Farm case. What it all boils down to is that medical funding is not that simple, and the laws governing these cases vary greatly from state to state.

Benefits of Medical Lien Companies

Regardless of whether a medical lien is determined to be non-recourse or not in a given state— although an important distinction—there is still the complication of medical providers functioning like financiers.

Medical funding companies, like Gain, for instance, preserve the role of all parties. Attorneys, plaintiffs, and doctors are all best served when an independent third party is the source of medical funding.

Healthcare providers should never take on this role or have a financial interest in the outcome of a case by holding their own liens. Their job is to provide the best medical care, period. The same is true for attorneys and providing the best legal advice in pursuit of their clients’ claims.

In both situations, there’s a conflict of interest. One possibility is that a doctor’s credibility may be undermined by the defense counsel, who could emphasize the doctor’s financial stake in the case rather than sticking to the facts. Alternatively, if the funding party is involved, they might be inclined to settle the case for less than its actual value to ensure they get repaid.

Neither of these scenarios should happen. Instead, a medical funding company can assess cases independently, with no influence on or ability to affect the case outcome, ensuring an unbiased position for all parties involved.

Attorneys and doctors should have no ownership interest in the outcome of their clients’ or patients’ cases, nor should they receive any compensation other than the value owed to the doctor for their professional services at the time of treatment and the time value granted by the attorney to maximize case values.

Turn to a Medical Lien Funding Company Instead

A serious shift in conversation takes place when a defense team finds a medical provider is also funding their own services, and thus, the case. A doctor’s opinion and treatment plan should be based solely on patient needs and never on whether or not they will be paid for their services. In other legal circumstances, this is referred to as the separation of church and state.

If you’re a personal injury victim who needs a pre-settlement cash advance, an attorney who needs funding for their client, or a medical provider who needs funding for a patient, reach out to a medical funding company that specializes in personal injury cases.

At Gain, we are dedicated to helping those who need financial help in order to get the treatment they need. Contact us today to speak to our professionals about our services.


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