The bill amends existing laws regarding the equitable allocation of recovery proceeds for subrogation claims related to injuries. It introduces a provision that mandates the division of attorneys' fees and costs incurred in enforcing liability between health maintenance organizations, hospitals, or medical service corporations and the injured party, based on the proportion of the recovery received. Additionally, it allows courts to reduce the amount of a lien if the settlement or judgment is less than the injured person's total damages, following a hearing to evaluate those damages.

Furthermore, the bill establishes that health maintenance organizations or insurers cannot claim more than their proportionate share of any recovery related to an injured person's damages, regardless of any contractual terms to the contrary. It also provides a mechanism for either the entity that provided benefits or the injured person to petition the court for a determination of the reasonableness of settlements and the fair allocation of amounts payable, including attorneys' fees. In cases where there is a disagreement over the recovery amount between the injured person and the insurer, the court will determine a just and reasonable apportionment, with the option for the injured party to withdraw consent to the settlement if dissatisfied with the court's decision.

Statutes affected:
Bill Text: 111-70A