Letter of Protection
When a client is represented by a lawyer, the lawyer may issue a letter of protection (LOP) to a doctor or medical provider, asking the doctor to hold their bill for collection, and promising to pay the doctor out of the proceeds of a personal injury case. The LOP does not make the lawyer responsible for the bill, it remains a contract between the patient and the doctor.
Your lawyer should not issue a letter of protection unless you agree and authorize your lawyer to issue such a letter. This form, which you must authorize states that you agree that the bills of the medical provider will be paid out of the proceeds of your personal injury settlement. If you are not successful in your case against the at-fault party, you are still responsible for paying your medical bills.
Only an attorney can issue a letter of protection which is a contract that places a lien on your injury settlement, requiring that the medical provider be paid from any settlement the attorney achieves on your behalf. The letter of protection is a contract formed between the medical provider and the attorney. If you don't have an attorney, the medical provider will not accept a letter of protection from you personally, because there is no new contract created, you already owe for the bill, so a letter of protection from the patient is meaningless. Whether a billing agent will accept a letter of protection from your lawyer, is at the discretion of the medical provider. Some providers such as hospitals, and doctors performing surgery, may not accept a letter of protection.
WHY DO I NEED A LETTER OF PROTECTION FROM AN ATTORNEY?
There are situations where billing sources unrelated to your injury case may request a letter of protection. Most attorneys will not agree to issue a letter of protection for a bill unrelated to the injury case, such as for a car payment, or other non-medical type billing. Typically a letter of protection is only issued to medical providers who treated the client for the injuries that are the basis of the personal injury case.
A common situation in which letters of protection are necessary includes automobile accidents in which the medical bills exceed the $10,000.00 in PIP benefits, and for which there is no health insurance or other source of payment. Additionally in motorcycle accidents or premises liability cases, where there is no personal injury protection (PIP) insurance, the injured client would have little chance to receive care for his or her injuries without a letter of protection.
Another common situation arises because PIP auto insurance in Florida only pays 80% of accident related medical bills, leaving 20% of your medical bills outstanding. Without a letter of protection your medical provider may require upfront payments or refuse to provide treatment without assurance that he will be paid. For many injured persons, a letter of protection may mean the difference between getting treatment for their injuries or not getting treatment.
The letter of protection is a contract between the medical provider and the lawyer, and is normally obtained through a process in which the medical provider contacts the lawyer requesting a letter of protection.
Letters of protection differ from advance settlement funding, because under a letter of protection no money changes hands, no interest is charged, and the medical bills are not paid until the case is settled. Once the case is settled, the lawyer is obligated to honor the letter of protection and pay the medical providers in accordance with the agreed upon letter of protection.