§663-10  Collateral sources; protection for
liens and rights of subrogation.  (a)  In any civil action in tort, the
court, before any judgment or stipulation to dismiss the action is approved,
shall determine the validity of any claim of a lien against the amount of the
judgment or settlement by any person who files timely notice of the claim to
the court or to the parties in the action.  The judgment entered, or the order
subsequent to settlement, shall include a statement of the amounts, if any, due
and owing to any person determined by the court to be a holder of a valid lien
and to be paid to the lienholder out of the amount of the corresponding special
damages recovered by the judgment or settlement.  In determining the payment
due the lienholder, the court shall deduct from the payment a reasonable sum
for the costs and fees incurred by the party who brought the civil action in
tort.  As used in this section, lien means a lien arising out of a claim for
payments made or indemnified from collateral sources, including health
insurance or benefits, for costs and expenses arising out of the injury which
is the subject of the civil action in tort.  If there is a settlement before
suit is filed or there is no civil action pending, then any party may petition a
court of competent jurisdiction for a determination of the validity and amount
of any claim of a lien.



(b)  Where an entity licensed under chapter 432
or 432D possesses a lien or potential lien under this section:



(1)  The person whose settlement or judgment is
subject to the lien or potential lien shall submit timely notice of a
third-party claim, third-party recovery of damages, and related information to
allow the lienholder or potential lienholder to determine the extent of
reimbursement required.  A refusal to submit timely notice shall constitute a
waiver by that person of section 431:13-103(a)(10).  An entity shall be
entitled to reimbursement of any benefits erroneously paid due to untimely
notice of a third-party claim;



(2)  A reimbursement dispute shall be subject to
binding arbitration in lieu of court proceedings if the party receiving
recovery and the lienholder agree to submit the dispute to binding arbitration,
and the process used shall be as agreed to by the parties in their binding arbitration
agreement; and



(3)  In any proceeding under this section to determine
the validity and amount of reimbursement, the court or arbitrator shall allow a
lienholder or person claiming a lien sufficient time and opportunity for
discovery and investigation.



For purposes of this subsection:



"Timely notice of a third-party
claim" means a reasonable time after any written claim or demand for
damages, settlement recovery, or insurance proceeds is made by or on behalf of
the person.



"Third-party claim" means any tort
claim for monetary recovery or damages that the individual has against any
person, entity, or insurer, other than the entity licensed under chapter 432 or
432D. [L Sp 1986, c 2, §16; am L 2000, c 29, §2; am L 2002, c 228, §2]



 



Case Notes



 



  Appellant's motion to determine its lien on settlement was
properly denied, because this section unambiguously applies to collateral
source payors, which appellant was not.  76 H. 266, 874 P.2d 1091.



  Cited:  73 H. 403, 833 P.2d 890.