The bills don't follow a logical order. A massive invoice from the hospital arrives first, followed weeks later by a separate one from the emergency room physician you saw for ten minutes. The radiologist sends their own demand for payment, and the anesthesiologist's bill shows up when you thought it was all over.
Its a financial ambush from a dozen different directions. But this chaos is an illusion.
In New York, a strict protocol dictates the flow of payment, a clear chain of command for financial responsibility that exists to bring order to this situation. The answer to who pays medical bills in a car accident isn't one entity; it's a sequence. Knowing that sequence is the key to regaining control.
Your NYC car accident attorney is the one who enforces this protocol, ensuring every bill is sent to the right party in the right order, and that the ultimate financial burden lands exactly where it belongs: with the negligent party.
The paper trail of payment:
- New York's No-Fault insurance system makes your own auto insurance policy the primary source for paying initial medical bills and lost wages, regardless of who caused the accident.
- A $50,000 cap typically limits these initial benefits, called Personal Injury Protection (PIP). Serious injuries can exhaust this amount very quickly.
- Once your PIP benefits run out, your private health insurance becomes the next payer. Your health insurer will likely place a lien on any future settlement for reimbursement.
- A personal injury lawsuit against the at-fault driver provides the legal path to recovering compensation for medical costs beyond your PIP limit and for your pain and suffering.
New York's No-Fault System
The most immediate answer to the question of who pays your medical bills is, perhaps surprisingly, your own car insurance company. New York operates under a "No-Fault" law, which means that after an accident, you turn to your own policy first for coverage of your economic losses.
The legislature designed this system decades ago to ensure that injured people get prompt medical treatment without waiting for a lengthy investigation to determine who was at fault for minor to moderate accidents.
The law calls this coverage Personal Injury Protection, or PIP. Every auto insurance policy sold in New York must have a minimum of $50,000 in PIP coverage.
This is your first and primary source of payment for medical expenses.
Your No-Fault policy covers a range of immediate economic losses. This coverage helps you manage the initial financial disruption following a crash.
- Necessary medical and rehabilitation expenses. This includes the ambulance ride, emergency room care, hospital stays, surgeries, diagnostic imaging, prescription medications, and physical therapy.
- A portion of your lost wages. PIP covers 80% of your lost earnings, with a maximum payout of $2,000 per month, for up to three years. Your doctor must provide documentation stating that you are medically disabled from working.
- Other reasonable and necessary expenses. This can include up to $25 per day for costs like household help or transportation to and from your medical appointments.
This system applies to the driver, any passengers in the vehicle, and any pedestrians or bicyclists the vehicle hits. The goal is the prompt payment of your bills so your treatment is not delayed while fault is determined.
How to Activate Your No-Fault (PIP) Benefits
Accessing your PIP benefits is not automatic. It requires you to take specific, time-sensitive steps to formally open a claim with your own insurance company. Missing these deadlines can result in a denial of benefits, leaving you personally responsible for all your medical bills. The insurance company will not give you a second chance.
The absolute 30-day filing deadline
You must file a written Application for No-Fault Benefits (Form NF-2) with your own auto insurer within 30 days of the car accident. This is a strict and unforgiving deadline. The form requires detailed information about the accident, your injuries, and your employment. If you fail to file this application on time, the insurance company has the right to deny your entire claim, and it is very difficult to reverse that decision.
Notifying your own insurer
Even before you send the form, you should notify your insurance agent or company about the accident as soon as possible, often within 24 hours. They will assign you a claim number and send you the necessary paperwork, including the NF-2 form. This starts the official process of activating your benefits and shows you are acting in good faith.
Where your medical providers send the bills
Once your PIP claim is open, your doctors, hospitals, and therapists will submit their bills directly to your auto insurance company for payment. They must use specific billing codes and submit their invoices within 45 days of rendering treatment.
The insurer pays these bills according to a fee schedule until your $50,000 in coverage is exhausted. You should not have to pay these providers out of your own pocket during this phase.
What Happens When Your No-Fault Benefits Run Out?
For anyone with a serious injury requiring surgery, hospitalization, and long-term care, a serious injury can use up the $50,000 in PIP coverage very quickly. This is a moment of great concern for many injured people.
When your auto insurer sends a formal letter stating that your No-Fault benefits are exhausted or denied, the responsibility for paying your medical bills shifts.
Your private health insurance takes over
Once PIP is exhausted, your private health insurance becomes the primary payer for your ongoing medical treatment. You will provide your health insurance information to your doctors, and they will begin submitting bills to your health plan just as they would for any other illness or injury.
You must pay any co-pays or deductibles your plan requires. This transition is essential, and you should inform your providers immediately to prevent bills from going unpaid.
Dealing with health insurance liens
When your health insurance company pays for medical treatment related to an accident that someone else caused, they will almost always place a "lien" on your personal injury case. A lien is a legal right to reimbursement, also known as a right of subrogation. This means that if you later recover money in a lawsuit against the at-fault driver, you must use a portion of that money to pay your health insurer back for the bills they covered. Your attorney will receive a formal notice of this lien.
Pursuing Compensation from the At-Fault Driver
The No-Fault system handles your immediate bills, but it does not hold the negligent driver accountable or compensate you for your pain and suffering. A personal injury lawsuit serves that purpose. This is how you seek the financial resources to cover medical costs beyond your PIP limit and to compensate you for the full impact the injury has had on your life.
The "serious injury" threshold requirement
In New York, you can only step outside the No-Fault system and sue the at-fault driver if your injuries meet a specific legal standard. New York Insurance Law § 5102(d) defines this "serious injury" threshold. An attorney uses your medical records and expert opinions to prove your injury qualifies as a fracture, a permanent limitation of a body part, or another condition listed in the statute.
Damages you can pursue
A lawsuit allows you to fight for compensation for all of your losses, not just the initial economic ones. This includes all past and future medical expenses, all past and future lost wages, and the non-economic damages for your human suffering.
Paying back liens from your settlement
You will often use a significant portion of any settlement or jury award in a serious injury case to satisfy the liens from your health insurance company. An experienced car accident attorney does more than just win your case; they also negotiate with the lienholders to potentially reduce the amount you have to pay back, maximizing the amount of money that goes into your pocket.
Don't Rely on AI Chat Tools for Legal Advice
An artificial intelligence program can give you a basic definition of No-Fault, but it cannot analyze your specific policy or explain the complex interplay between PIP, your health plan, and a third-party lawsuit.
Relying on an algorithm for guidance on who pays your medical bills may lead to missed deadlines and costly financial mistakes. For advice specific to your situation in New York, always consult a qualified attorney from The Perecman Firm.
FAQ for Who Pays Medical Bills in a Car Accident
What happens if I was on a motorcycle when I was hit?
New York's No-Fault law does not cover motorcyclists. The legislature excluded them from the system due to the higher risk of serious injury. If you were injured on a motorcycle, the at-fault driver's insurance pays your medical bills from the very beginning. You do not have to meet a "serious injury" threshold to file a lawsuit for your pain and suffering.
I was a pedestrian and don't own a car. Who pays my bills?
If a vehicle hit you while you were a pedestrian, you can receive No-Fault benefits. You would first file a claim with your own auto insurer if you have one. If you do not own a car, you can file for PIP benefits through the insurance policy of a relative you live with. If that is not an option, you would file with the insurance company for the vehicle that struck you. In a hit-and-run scenario, you may need to file with the Motor Vehicle Accident Indemnification Corporation (MVAIC).
Can I choose my own doctors under No-Fault?
Yes, you have the right to choose your own doctors and medical providers. You do not have to see a doctor the insurance company chooses for treatment. However, the insurer does have the right to have you examined by their own doctor periodically. They call this an Independent Medical Examination (IME). The purpose of the IME is for their doctor to confirm that your treatment is necessary and related to the accident.
Take Control of Your Financial Recovery
The flow of medical bills after a car accident can feel like an avalanche. It does not have to bury you. Knowing the system and having a strong advocate on your side can make all the difference, allowing you to focus your energy on what matters most: your health.
The New York City personal injury attorneys at The Perecman Firm have helped injured New Yorkers for over 40 years. We take on the burden of dealing with the insurance companies so you do not have to. Your energy is for healing; ours is for the fight.
Contact us today for a free, confidential consultation. Reach our New York City office at (212) 977-7033.