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Arizona Medical Liens No Longer Apply to MedPay Benefits

The Amendment

Arizona recently amended ARS § 33-931 so that medical payment (“MedPay”) benefits are no longer subject to health care provider liens for treatment rendered to injured persons. 

Why It Matters  

  • ARS § 33-931 previously stated healthcare provider liens do not apply to Uninsured Motorist and Underinsured Motorist benefits (only).
  • The amendment to ARS § 33-931 overrules Dignity Health v. Farmers Ins. Co. of Ariz., 1 CA-CV-18-0292, 2019 WL1499855 (Ariz. App. June 11, 2019) (Memorandum Decision), which held MedPay benefits were subject to medical liens because MedPay coverage did not qualify as “health Insurance” exempt from medical liens under ARS § 33-931.

The Takeaways

  • Insurers in Arizona no longer need to protect medical liens when paying MedPay benefits.
  • Arizona claimants and/or their counsel may accuse an insurer of bad faith if the insurer demands protection of a medical lien before payment of MedPay benefits.

The Amended Statute 

ARS § 33-931(A) now states, in full, “Every individual, partnership, firm, association, corporation or institution or any governmental unit that maintains and operates a health care institution or provides health care services in this state and that has been duly licensed by this state, or any political subdivision or private entity with ambulances operated, licensed or registered pursuant to title 36, chapter 21.1, is entitled to a lien for the care and treatment or transportation of an injured person as prescribed by subsection E of this section. The lien shall be for the claimant’s customary charges for care and treatment or transportation of an injured person. A lien pursuant to this section extends to all claims of liability or indemnity, except health insurance and medical payments coverage and underinsured motorist and uninsured motorist coverage as defined in § 20-259.01, for damages accruing to the person to whom the services are rendered, or to that person’s legal representative, on account of the injuries that gave rise to the claims and that required the services.” (emphases added).

This post and other posts regarding Arizona insurance bad faith and coverage law can also be found at our blawg: Arizona Bad Faith Blawg.

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