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Last Modified on Apr 02, 2026
Many people hesitate to file personal injury claims after a catastrophe, such as a car accident, due to concerns about their Medicaid coverage and eligibility. This is a valid concern, as personal injury settlements can affect your eligibility for Medicaid benefits. This may leave people wondering about the connection between Medicaid and personal injury settlements.
However, with skilled, knowledgeable, and compassionate legal help, there are ways to navigate this challenge.
Safeguard Your Medicaid and Personal Injury Settlements
Medicaid assists many low-income Americans with health insurance through an income-based approval process. That approval process can quickly become complicated if a recipient’s financial situation changes. Unfortunately, your Medicaid benefits can become compromised if you receive a settlement from a personal injury claim.
However, there are ways to avoid losing your Medicaid coverage when filing a personal injury claim. Securing skilled, knowledgeable, and compassionate legal help will make all the difference in protecting your Medicaid coverage while pursuing your personal injury case.
A Personal Injury Can Complicate Your Health, Life, and Finances
We all hope to move through life without experiencing hardships such as a personal injury related to a car accident or other mishap. Still, when the unthinkable happens, it is imperative to plan your next steps properly. You may feel overwhelmed by doctor’s visits, the future of your health, and bills piling up from lost wages. The effect that this can have on your loved ones, including dependents, can feel crippling.
The average personal injury settlement amount is $60,000, which is no small sum when finances are tight following an accident! A personal injury settlement like that would relieve much of your financial burden, but if you receive Medicaid coverage, obtaining a settlement can compromise your Medicaid eligibility.
It’s essential to examine how Medicaid coverage can be affected by a personal injury claim and the impact this can have on your current situation. You’ll need to consider your countable assets, which are significant in determining your Medicaid eligibility post-settlement.
Exploring the Historical Connection Between Medicaid and Personal Injury
With Medicaid eligibility contingent on income and assets, it’s no surprise that a sudden increase in income or assets can disqualify a person from continuing to receive Medicaid coverage.
However, when faced with a personal injury, there are more challenges to consider than medical bills. Lost wages, pain and suffering, and the impact the accident can have on your life and loved ones, including dependents, must also be considered.
Unfortunately, the Supreme Court has sided with Medicaid in the past, allowing Medicaid to recoup settlement funds intended for future medical care to cover the cost of care it has already provided for an accident victim. For victims of personal injuries, this means that not only can their Medicaid care be rescinded after receiving a settlement, but the settlement itself is at risk of being intercepted by Medicaid for past and future care costs.
Personal Injuries You Could Experience
In 2022, there were 7,970.3 hospital visits per 100,000 people for nonfatal injuries. Accidents can cause all sorts of injuries depending on their nature and severity. Some injuries are visible, like cuts and bruises, while others, such as soft-tissue injuries (sprains and strains), broken bones, herniated discs, and traumatic brain injuries, are not. In severe accidents, victims can sustain spinal cord injuries, internal bleeding, or organ damage.
Whiplash and concussion symptoms can take time to appear. If you suspect you might have suffered a concussion, seek medical attention immediately to make sure your symptoms do not worsen. Some accidents leave victims in chronic pain, with limited mobility, or permanently disabled.
Injuries can prevent you from being able to work or carry out your day-to-day life as you once did. Mental anguish, such as anxiety, depression, and post-traumatic stress, is also common after sustaining an injury. The long-term medical costs associated with treating your injuries are often used to calculate your injury settlement. Since personal injury settlements can affect Medicaid benefits, it’s crucial to know how your injury may impact you now and in the future.
What are Countable Assets?
Countable assets are financial and property resources that Medicaid considers when determining an individual’s eligibility for coverage. Examples include cash, the funds in your bank account, real estate owned (excluding a primary residence), investments, and certain personal property.
Medicaid eligibility is determined by the value of one’s countable assets, and exceeding these limits can impact a person’s eligibility to receive Medicaid.
Facing the Facts: The Impact of a Personal Injury Claim on Medicaid Coverage
The settlement funds can be classified as a countable asset if you receive a settlement from a personal injury claim. The settlement can push you above Medicaid’s asset limit, which, if surpassed, may result in a temporary or permanent loss of your Medicaid benefits.
Managing your countable assets, including future settlement funds, is crucial during the settlement process to make sure that your Medicaid coverage is not jeopardized. This involves strategic planning and legal assistance to navigate the complexities of personal injury claims without adversely affecting essential healthcare benefits.
Examples of ways to manage your countable assets when receiving a settlement include:
- Structured Settlements
Opting for a structured settlement rather than a lump-sum payment provides periodic payments, which can reduce the immediate impact on your countable assets and, in turn, on your subsequent Medicaid eligibility.
- Special Needs Trusts
Establishing a special needs trust to cover specific non-medical needs can help preserve Medicaid eligibility for healthcare-related expenses.
- Medical Expense Planning
Properly documenting and allocating settlement funds for past and future medical expenses may allow those funds to be excluded from the countable assets used to determine Medicaid eligibility.
How to Protect Your Medicaid Coverage During a Personal Injury Claim
Navigating through lost wages, emotional distress, medical bills, and the aftermath of a personal injury can be overwhelming, especially when coupled with the fear of losing your Medicaid coverage.
Having a reliable, transparent, and experienced lawyer by your side can significantly ease this burden. Don’t face these challenges alone. Protect your Medicaid coverage proactively; Wigod & Falzon will empower you with the knowledge, confidence, and informed options you need.
Move Forward With the Experience and Knowledge of Lawyers Who Care
To avoid losing your Medicaid coverage, it’s imperative to have a legal team with both experience and knowledge.
The skilled, knowledgeable, and compassionate lawyers at Wigod & Falzon will work hard and keep your best interests in mind. Losing isn’t an option with us; contact Wigod & Falzon today to discuss the appropriate course of action for your personal injury or car accident case.
FAQs
Q: How Much Will Medicaid Take From My Settlement?
A: Typically, Medicaid can only reimburse itself for medical bills it actually paid on your behalf because of your injury. Often, the total amount Medicaid demands will be reduced or negotiated down based on various factors such as attorney fees and the specific language of the settlement. A personal injury attorney can help you understand Medicaid laws and how they apply.
Q: Do You Have to Pay Back Medicaid if You Win a Claim?
A: If Medicaid paid for treatment you received as a result of your injury, it will likely have a lien against your settlement or award. This means that Medicaid will be entitled to reimbursement from your recovery. There are a few exceptions, and the amount Medicaid can recover may be reduced.
Q: Will I Lose My Medicare if I Get a Settlement?
A: Simply because you receive a settlement from a personal injury claim does not mean that you will lose your Medicare benefits. However, you may have to reimburse Medicare for conditional payments or set aside funds for future medical expenses. When these situations arise, it is important to handle them correctly so you can continue to keep your benefits.
Q: Does a Personal Injury Settlement Affect Medicaid Eligibility?
A: Yes, a settlement can impact your Medicaid eligibility as it can be counted as income or an asset. Depending on how much you receive, it can temporarily make you ineligible for benefits. There are legal ways to still receive a settlement without completely losing your eligibility. Engage an experienced lawyer for help.
About Wigod & Falzon
Serving Detroit and its surrounding areas for nearly three decades, the Wigod & Falzon personal injury law firm has the knowledge and experience to lead you through every step of pursuing a personal injury settlement.
Wigod & Falzon operate on a contingency-fee basis, meaning the fees and case expenses are covered by a percentage of the settlement/judgment. At Wigod & Falzon, we take 5 percent less than the other guys, making sure that legal aid is equitable and available to all–no down payment necessary.
Hire a Personal Injury Lawyer
Do not attempt to handle the compensation process on your own if you have been injured and have questions regarding your settlement or benefits. Wigod & Falzon is here to assist you in understanding the various choices available to you and in safeguarding what is most important to you.
For a free consultation and advice that is both straightforward and honest, tailored to your circumstances, please get in touch with us immediately. Contact us to get started.
