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Auto MedPay Insurance, Coverage and Collection

medical bills

As a Sacramento Personal Injury Lawyer, I have seen many tragic cases where an injured person was clearly not at fault but also could not afford medical care for his or her accident.

One of the traditional insurance coverages that help defray medical expenses of people in motor vehicle accidents is called MedPay Insurance.

Although Medpay coverage is inexpensive and very useful, apparently insurance agents don’t get a high  commission for selling it, and as a result, it is missing or inadequate in many policies.

Insurance agents, in general, have done a very poor job in explaining the various auto coverages, and I am working on a section of my web site, which will soon contain an article recommending various auto insurance coverages, what the types of insurance do, and the amounts that are prudent to carry.  (Coming soon to my website at

Since insurance agents typically do such a poor job in recommending auto medpay coverages,  personal injury attorney’s, family doctors and chiropractors should educate their clients or patients on Medpay and why it can be very useful.

What is Medpay Coverage?

Medpay Coverage is optional insurance on an auto policy. Mistakenly, agents tell their prospective clients that if they have medical insurance through work or Medicare or an HMO that they don’t need Medpay Coverage at all. That may be technically correct, but in reality it’s very misleading.

A typical Medpay Policy will pay “reasonable expenses incurred for necessary medical and funeral expenses caused by an accident and sustained by the insured”.

Before we examine what the above language means, lets revisit why one should have Medpay no matter what other medical insurance is available.

First, up to the amount of the Medpay Coverage, Medpay will pay for care of the person who owns the policy or the care of anyone else in the vehicle with the insured driver.

So, if a father is transporting his children and 2 neighborhood children to a local ballgame and there is a car crash where everyone is injured, every person in the car can get treatment up to the amount of the Medpay Policy. So if there’s a $10,000 Medpay provision, everyone in the father’s car is entitled to care up to that amount. Medpay pays no matter who was at fault, the father or the driver of the other vehicle.

If, on the other hand, some of the other children’s parents had no medical insurance, those parents might be very hard pressed to pay for immediate care for their children. So Medpay is useful here even if the father had insurance thru a PPO or HMO or Medicare or Medi-cal.

Second, with some exceptions,  Medpay does not typically restrict where that person can treat as do so many other medical coverages.

With many insurance coverages, the patient if forced to wait for an appointment with their HMO doctor or physical  therapist and it may be a week or more before they can get in to see someone.

This is no fun, when you’re suffering painful injuries. On the other hand, with Medpay, the injured parties can treat immediately and be assured they they can see the best doctors and have immediate care for their injuries.


I have for years recommended that call my clients obtain a minimal medpay coverage of $10,000 and even $25,000 or $100,000 if the premium is not too steep. (And usually it’s relatively inexpensive).

When buying Medpay insurance from their auto carrier, I also urge clients to obtain medpay coverage for 3 years or longer from the date of the accident. Many medpay insurance provisions limit medpay coverage to 1 year and in many chronic pain cases, the pain has not resolved within that period.

Clients purchasing Medpay insurance should also look for sneaky exemptions in the policy.

Many policies exclude acupuncture and thermography, although both of those modalities are often helpful to people injured in accidents.

Recently, aggressive insurance companies have also excluded chiropractic treatment from coverage, although chiropractic care has been shown to be amongst the most beneficial treatments immediately following an auto accident.


One type of policy that should NEVER be purchased is “Excess Medpay”. Typically, clients do not understand what they are paying for. They believe they are paying for Regular Medpay coverage only to be told after an accident, that “Sorry, this is excess…you must first try to obtain treatment at any other places you qualify (Medicare, Medi-Cal, Kaiser, Blue Cross, etc.) and then, if they cannot provide the care you need (for example, chiropractic care), you must get a letter from that entity  stating they will not cover that type of treatment.

Needless to say, the hassles in trying to comply with this provision and get letters from government entities or PPO’s are hopelessly frustrating and time consuming.

Again I urge consumers at all costs to avoid Excess Medpay Coverages.

Collecting on Medpay Coverage

The first step is to encourage clients and patients ahead of time to obtain adequate Medpay coverage as outlined above.

Insurance companies love to collect premiums. When it comes time for them to pay, however, there are a multitude of reasons that give to try to deny coverage.

The most frequent reason for insurers to deny medpay payments is that the treatment wasn’t “Reasonable” as is required in the policy.

Although, in California, there is a presumption that medical bills are reasonable, that presumption can be rebutted and insurance companies avail themselves of every opportunity to say the bills are unreasonable.

Reasonable medical charges

Medpay policies state they will only pay for “Reasonable and Necessary charges”.

Presuming the medical providers have submitted the proper ICD-9 diagnostic codes and CPT codes, the bills should be promptly paid in full.

This is where insurance companies like to play games. They will use utilization review panels to do a review of the reasonable charges on in the community.  They typically use an outside service but many times the real review is by some computer system.

In California, there is a presumption that medical bills incurred are reasonable. If these companies state that the charges are not reasonable and seek to diminish the amount paid, the burden of proof is upon them to show why the charges are unreasonable.

At every step in the process, the doctor should challenge in writing any reduction. Ask why there was a reduction? If they state is was based on the community charges, ask them the exact community they utilize in their determination and other providers that are supposedly charging a “reasonable” fee. Then call those doctors to confirm they are charging that amount.

Necessary Medical Charges

Sometimes, the carrier will challenge the bills submitted stating treatment was not necessary. If this is the excuse, write and request a full explanation of their position .

If they Still won’t pay

Give the insurance company every chance to to get the information they state they need to pay their claim. If they still do not pay, it may be time to have an attorney become involved.

My office will often  prepare and serve a Complaint for Bad Faith if the insurance companies position is groundless.

Recently, several National Insurers have been hit with large bad faith judgments because of their failure to pay what they should have under the medpay provisions of the policy.

My office works diligently to help collect Medpay for my client’s cases.

If you are having difficulty with certain insurers because of their failure to pay medpay, feel free to contact me at any time.

I’m Ed Smith, a Sacramento Personal Injury Lawyer. Call me anytime at 916-921-6400 for free, friendly advice.  See our Reviews on Yelp and Avvo.


















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