When someone is injured in an accident and receives medical treatment, the bills for that treatment need to be paid. In many personal injury cases, the injured person cannot pay upfront — and the at-fault driver’s insurance company will not pay individual bills as they come in. Liens fill that gap. They allow medical providers and insurance companies to ensure they will be repaid from whatever settlement or judgment the injured person eventually receives.
Liens are one of the least understood aspects of the personal injury settlement process, and they are also one of the most financially significant. A settlement amount that looks substantial on paper can shrink considerably once valid liens are paid. Understanding what liens exist, who can assert them, how they must be perfected under Nevada law, and how they can be negotiated is essential knowledge for any Nevada accident victim.
What Is a Lien in a Personal Injury Case?
A lien is a legal claim against the proceeds of a future settlement or judgment. In the personal injury context, a lien gives a medical provider, insurance company, or government program the right to be repaid from your injury recovery for treatment costs they covered. The lien attaches to the settlement funds, not to your personal property, and it must generally be satisfied before you receive your net settlement check.
Liens do not prevent you from pursuing your claim or reaching a settlement. They are a reimbursement mechanism that runs parallel to the injury claim itself.
Types of Liens in Nevada Personal Injury Cases
Hospital Liens Under NRS 108.590
Nevada gives hospitals a specific statutory lien for the reasonable value of hospitalization provided to an injured person who then pursues a damage claim. Under NRS 108.590, a hospital that treats an injury victim may assert a lien against any judgment or settlement the patient receives.
For this lien to be enforceable, it must be properly perfected. Under NRS 108.610, the hospital must record the lien with the county recorder in the county where the services were provided. When the lien is properly recorded and notice is given, any party who pays settlement funds to the injured person without satisfying the hospital lien becomes liable to the hospital for the unpaid amount under NRS 108.650.
Importantly, attorney fees, costs, and expenses incurred by the injured party in pursuing the claim take priority over hospital liens under NRS 108.600(2). This means the attorney’s fee is paid before the hospital lien is satisfied from the settlement.
Health Insurance Subrogation
If your health insurance paid for medical treatment related to your accident, your insurer likely has a subrogation right — the right to recover from your settlement the amounts they paid on your behalf. Subrogation rights typically arise from the contract terms of your health insurance policy and are separate from the statutory hospital lien framework.
The scope of health insurance subrogation in Nevada is affected by whether the plan is governed by state law or federal law. Employment-based health plans governed by the federal Employee Retirement Income Security Act (ERISA) may have broader subrogation rights than state-regulated plans. Understanding which legal framework applies to your plan is essential to evaluating the lien exposure.
Nevada law under NRS 449.757 and NRS 449.758 also places specific obligations on hospitals regarding the billing order when a patient has health insurance. Hospitals are generally required to bill health insurance before pursuing collection from a personal injury settlement. When hospitals fail to follow this process, it may affect the validity or amount of their lien.
Medicare and Medicaid Liens
If Medicare or Medicaid paid for treatment related to your accident, those programs have federal reimbursement rights that take priority over most other claims. Medicare’s right to recover is governed by the Medicare Secondary Payer Act, and failing to satisfy a Medicare lien can result in significant federal penalties. These are not optional — they must be addressed as part of every settlement involving Medicare beneficiaries.
Medicaid liens are governed by both federal and state law. Nevada’s Medicaid program may assert a lien against a personal injury recovery for benefits it paid. Unlike some other types of liens, Medicaid liens have specific anti-lien and anti-recovery limitations under federal law that can reduce the amount actually owed. Navigating Medicare and Medicaid liens requires careful coordination.
Medical Provider Liens (Letters of Protection)
Some medical providers, particularly specialists who treat personal injury patients, agree to provide treatment on a lien basis rather than billing insurance upfront. In exchange for treating you now, the provider places a lien on your future settlement proceeds as security for their payment. These arrangements, sometimes called letters of protection, allow injured people who lack adequate insurance to access necessary medical care while their case is pending.
The amount owed under a letter of protection lien is often billed at the provider’s full rate, which may be significantly higher than what the same provider would accept from an insurance company. The negotiation of these amounts is often one of the most important steps in finalizing a settlement.
Workers’ Compensation Liens
If you were injured in a work-related accident and received workers’ compensation benefits, the workers’ compensation carrier may have a lien against any third-party personal injury recovery. For example, if you were injured by a negligent driver while driving for work, you may have both a workers’ compensation claim against your employer’s carrier and a personal injury claim against the at-fault driver. The workers’ comp carrier can assert a lien on the personal injury settlement to recover what they paid in benefits.
How Liens Are Negotiated
One of the most important functions an attorney performs after reaching a settlement is negotiating lien amounts down from their face value. Many lienholders, particularly medical providers billing under letters of protection, will accept a reduction in exchange for prompt payment from the settlement. The negotiation leverage comes from the certainty and timing of payment — a provider who bills $50,000 may accept $25,000 to close the matter cleanly at settlement rather than waiting or pursuing collection.
Health insurance subrogation amounts can also sometimes be reduced, particularly in cases where the total recovery is limited relative to the full damages. Most health insurance plans have a make-whole doctrine or similar equitable limitation that prevents them from recovering subrogation in full when the injured person has not been fully compensated for all their losses.
The negotiation of liens is often just as important to your final take-home amount as the negotiation of the settlement itself. A strong result on the lien side can meaningfully increase what actually reaches the client.
How the Settlement Distribution Process Works
When a Nevada personal injury case settles, the process of distributing the funds typically works as follows: The settlement funds are deposited into the attorney’s client trust account, where they are held separately from the firm’s own funds. The attorney then identifies and verifies all valid liens, confirms the amounts owed, and negotiates reductions where possible. Case costs advanced by the attorney are calculated. The attorney fee is calculated per the contingency agreement. Valid liens are paid in their proper priority order. The remaining balance is distributed to the client, along with a written settlement statement itemizing every deduction.
Nevada State Bar rules require attorneys to provide clients with a complete accounting of all funds received and distributed. You are entitled to see exactly where every dollar of your settlement went before signing off on the distribution.
What Happens If You Settle Without Addressing Liens?
Settling a personal injury case without properly addressing valid liens can create serious problems. A hospital that has perfected a lien under NRS 108.610 can pursue the parties who paid settlement funds without satisfying the lien. Medicare can pursue the injured person, their attorney, and others involved in the settlement for unpaid Medicare claims. Ignoring liens does not make them go away.
This is one of the most important reasons to have an attorney manage the settlement process rather than attempting to resolve a personal injury claim independently.
Marathon Law Group: Managing Liens and Maximizing Your Recovery
At Marathon Law Group, lien identification, verification, and negotiation are a standard part of how we manage every personal injury settlement. We ensure that valid liens are satisfied, that invalid or excessive lien claims are challenged, and that our clients understand every component of their settlement distribution. We handle personal injury cases on a contingency fee basis. Call us at (702) 522-1808, email mlg@marathonlawgroup.com, or contact us online for a free consultation.
This blog post is for general informational purposes only and does not constitute legal advice. Reading this content does not create an attorney-client relationship. Every case is different. Please consult a licensed Nevada attorney for advice specific to your situation. Prior results do not guarantee a similar outcome.