On January 1, 2017, Ohio’s subrogation law (often referred to as the “Fair Share” law) went into effect in its entirety and now applies to health insurance policies. (The law was originally enacted and became effective in 2015, and was reenacted in 2016.) “Subrogation” frequently arises in the context of insurance claims. For example, in a car accident or other personal injury case, a health insurance company that has paid an injured party’s medical bills caused by another at-fault party often claims subrogation rights. This means it will demand reimbursement from any financial recovery obtained by the injured person (even though the insurance company hasn’t done anything to help actually procure that recovery and even if that recovery is limited). Many insurers demand full reimbursement even if the injured victim recovers less than their full damages, leaving little, if anything, for the injured victim. In other words, insurance companies have often tried to take every penny from the injured victim, including those severely or catastrophically injured, even where it results in an unfair and unreasonable outcome.
Ohio’s law holds that if an injured party recovers less than his or her full damages, the reimbursement of a party claiming the subrogation right is also reduced in proportion to the diminished recovery. Specifically, the law, Ohio Revised Code § 2323.44, states:
(B) Notwithstanding any contract or statutory provision to the contrary, the rights of a subrogee or any other person or entity that asserts a contractual, statutory, or common law subrogation claim against a third party or an injured party in a tort action shall be subject to both of the following:
(1) If less than the full value of the tort action is recovered for comparative negligence, diminishment due to a party’s liability under sections 2307.22 to 2307.28 of the Revised Code, or by reason of the collectability of the full value of the claim for injury, death, or loss to person resulting from limited liability insurance or any other cause, the subrogee’s or other person’s or entity’s claim shall be diminished in the same proportion as the injured party’s interest is diminished.
(2) If a dispute regarding the distribution of the recovery in the tort action arises, either party may file an action under Chapter 2721. of the Revised Code to resolve the issue of the distribution of the recovery.
This important law provides a more fair and balanced payment back to a subrogated party and helps protect injured Ohioans.
Attorney Pamela A. Borgess, the founder of Borgess Law, LLC, is an experienced trial attorney who focuses on civil litigation, including defective medical drugs/devices, defective consumer products, business/contract disputes, wrongful death and injury, car and truck accidents, and nursing home abuse cases. To speak with Attorney Borgess, call Borgess Law at (567) 455-5955 or toll-free at (844) LAW-9144. You can also contact Borgess Law by submitting an online inquiry. Borgess Law never charges for initial consultations.