Who Pays for Medical Bills After a Car Accident in New Jersey?
MEDICAL BENEFITS ("PIP") COVERAGE
A. How Much
Under New Jersey law, basic policyholders owners must carry at least $15,000 of medical coverage to pay for medical bills incurred in an auto accident. Under the more common, standard policy, the usual limit is $250,000. However, standard policyholders may elect lower amounts and may opt out of PIP coverage if a private health insurer is designated.
New Jersey law includes a fail-safe exception: the $250,000 limit is always available for certain significant injuries, like permanent or significant brain injury, spinal cord injury or disfigurement or for medically necessary treatment of other permanent or significant injuries. For these types of significant injuries, costs for emergency/trauma treatment and critical care will be covered up to the $250,000 amount.
Under a standard policy, New Jersey PIP benefits also include income continuation ($100 per week up to a limit of $5,200); death benefits with two choices of a lump sum ($5,200 or $4,380); funeral benefits (maximum equals $1,000) and essential services benefits/household help ($12 per day up to $4,380).
B. Who Pays
Many states including New Jersey are "No Fault"-meaning that regardless of whose fault the accident was, a driver can make a medical benefits claim under their own auto insurance policy, up to the amount of medical benefit coverage purchased.
For example, you get into a car accident with another driver in New Jersey. Both of you have insurance policies with medical benefits coverage. Let's assume that you have $250,000 of medical benefits coverage and the other driver has a basic policy with $10,000. If both of you are injured and require medical treatment, you would both make a claim under your respective policies. In this example, you could make a claim for medical benefits up to $250,000 and the other driver could make a claim for medical benefits up to $10,000.
Also, the medical benefits coverage amount is per person, per accident. In other words, if a father and his minor son are injured in an accident, and the father has an auto policy with $250,000 medical benefits coverage, then both can receive up to $250,000 of that coverage. If the father or son get into a subsequent accident, they would again be eligible for $250,000 of the same coverage.
C. Persons Eligible to Make PIP Claims
When a person is injured in an accident, there can be more than one source of medical benefits. Under New Jersey law, multiple classes of persons are eligible to make PIP claims. The first class of persons who may make PIP claims include a policyholder and members of his household. The second class includes a policyholder or members of his household who get injured as pedestrians. The third class includes those using an auto with the permission of the owner/policyholder. What this means in practical terms is that if you get in an accident, you can get PIP coverage if you or your spouse have your own auto insurance policy or you live with a relative who has a policy. If you're a driver or passenger in a car accident and you have no auto insurance policy, you can get PIP coverage under the auto insurance policy covering the car you were in at the time of the accident.
Pedestrians who get hit by cars and have no applicable auto insurance coverage are eligible to make PIP claims under a special fund, the New Jersey Property Liability Guaranty Association. Also, if a person is injured in an auto accident during their employment, workers' compensation coverage is the primary source of medical benefits coverage. However, under New Jersey law, the injured person does not have to wait for a workers' compensation determination of eligibility. Initially, the injured person's auto insurer must make the payments.
Also, certain people simply cannot make PIP claims. Motorcycle drivers and owners of registered autos who fail to purchase auto insurance cannot make any PIP claim. For example, you may own a registered car, but then fail to obtain insurance for it. If you subsequently get injured in an accident, you cannot make a claim for medical benefits under the auto insurance policy covering the car you were in at the time of the accident-say a friend's car. These classes of drivers must use their own medical/health insurance to pay for any medical bills incurred as a result of an accident.
D. How It Works
Immediately after an accident, the injured driver/passenger can receive emergency medical treatment at any facility. A PIP application from the PIP insurance carrier will also be required, usually within the next few days. Pre-authorization is then usually required for any subsequent treatment. All treatment and payment for treatment will occur according to a strict schedule adopted by the New Jersey Department of Insurance.
Many people in accidents in New Jersey are surprised to learn of the deductible/co-payment arrangement under their policy. Most policies provide for a deductible and then a 20% co-payment on top of the deductible. The deductible/co-payment scheme applies to the first $5,000 of medical bills. All amounts beyond the $5,000 are paid without a deductible or co-pay. Most deductibles under the standard policy are $250 but can be as high as $2500. In practical terms, this means that the injured driver/passenger will pay a $250 deductible first and then a maximum of $950 in co-payments, for a total of $1200. Or if the deductible is $500, the injured person pays the first $500 and then a maximum of $900 in co-payments, for a total of $1400.
If you've been in a car accident in New Jersey, it is vital that you speak to a qualified, experienced New Jersey/Pennsylvania car accident lawyer. The team at White and Williams has handled many car accident cases and has achieved much success. We serve accident victims in Pennsylvania and New Jersey and always offer a free consultation. 1-877-944-8396