How Much Will Medicaid Take From My Settlement? (2024)

Medicaid will usually take an amount from your settlement to cover the medical expenses they paid on your behalf. If you find yourself asking, “Exactly how much will Medicaid take from my settlement?” there’s no simple answer. The amount can depend on your state and other factors.

At ConsumerShield, our team offers the information you need as you begin a personal injury claim. We’ll connect you with experienced lawyers who can help you navigate the intricacies of the legal system.

Medicaid: What It Is and Who’s Eligible

Medicaid is a federal and state program that offers coverage for people with limited resources. Although each state has to follow the laws set forth by the federal government regarding Medicaid, there are differences from state to state. Medicaid covers more than one in five Americans.

Medicaid generally offers programs that Medicare doesn’t, like nursing home care, and doesn’t require that you pay anything for covered medical expenses. Eligibility depends on your taxable income and your family’s size, but states have specific requirements.

The federal requirements include being a citizen, permanent resident or legal alien, having a low income, and meeting at least one of these:

• Being pregnant

• Being blind

• Being 65 years or older

• Being in charge of a child 18 or younger

• Having a disability or having a loved one with a disability

The exact income threshold will depend on your state and the family members in your home.

Can Medicaid Take Your Settlement Money?

The answer is yes; Medicaid can take some of your settlement money to cover the medical expenses it paid for you. The program has a strong claim on your personal injury claim winnings, and placing a Medicaid lien on settlement money is common. Medicaid can ask for part or all of your settlement. The program is protected by state and federal laws.

To place a lien on your settlement, Medicaid has to notify you, your attorney, and the insurance company paying the settlement. It’s a complex process, and Medicaid has to follow strict state protocols to be able to successfully place a lien. Typically, Medicaid will receive the funds from the settlement before you do.

Some states have caps on the lien amount Medicaid can take. In Illinois, for example, there’s a 40% cap, meaning that Medicaid can’t take more than 40% of your settlement. Keep in mind that the lien is placed on the amount left over after paying your lawyer’s fees.

Medicaid also can’t take money from the part of the settlement that goes toward lost wages and pain and suffering. So if you’ve been asking, “Can Medicaid take my settlement money?” keep in mind that it only gets compensation from the medical winnings.

Paying Back Medicaid After Settlement

Because the answer to the question “How much will Medicaid take from my settlement?” is not clear, it’s common for people to hesitate to file a personal injury claim. After all, why go through the trouble of a claim if you know that Medicaid will take some of the settlement?

Not filing a claim after suffering an injury that someone else’s negligent conduct or intentional behavior caused because of fear of losing money to Medicaid can hurt you.

Medicaid takes a small amount from your settlement, and because most settlements don’t directly state how much of it compensates you for medical expenses, there may be room to negotiate. To do so, having a personal injury lawyer is critical. With the right attorney, it’s possible to reduce Medicaid’s claim.

Negotiating Medicaid Liens

To negotiate with Medicaid, your lawyer will rely on numerous strategies, including reviewing the itemized list of the medical expenses Medicaid paid for and searching for any inflated costs. Another strategy that can help is to demonstrate that you would suffer significant hardship if Medicaid claimed full reimbursement.

Often, offering a lump sum payment to Medicaid that is less than what they’re claiming can be an acceptable solution. Medicaid could settle for that instead of having to pursue payments.

The Importance of Legal Counsel In Personal Injury Claims

Having a personal injury lawyer is essential when facing a Medicaid lien, but it’s important throughout the entire process. A lawyer will be able to investigate the accident that resulted in your injuries and advise you on the options you have, like suing for emotional distress.

They’ll know what evidence to gather that can make a difference in demonstrating you deserve compensation. They’ll also have contact with expert witnesses, including accident reconstructionists and medical professionals.

A personal injury lawyer knows how to negotiate with insurance companies. They know the various tactics that insurers may try to keep from paying you the full compensation you deserve, so they’ll have the best chance of maximizing your winnings.

If negotiations don’t go as planned or if there are disputes, your lawyer can also take your claim to court. This can be important in complex cases, including mass torts.

Get Experienced Representation to Help You With Your Claim

Navigating the personal injury claim process is difficult, and worrying about questions like “How much will Medicaid take from my settlement?” can make things even more complex. To have a chance to receive fair compensation after suffering losses in an accident, you need experienced and dependable lawyers to help you.

At ConsumerShield, we offer legal guidance during free consultations as well as the opportunity to quickly connect with lawyers who can help you prove tort liability and negotiate with Medicaid. Don’t wait to get the assistance you need. Contact our team to speak with a professional about your claim.