Subrogation Laws in All 50 States - Interactive Map

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Click on your state for a brief summary of that state's laws affecting or impacting subrogation recoveries.

 

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Delaware Subrogation Laws

State Subrogation

Recognizes contractual and equitable subrogation

In a fire insurance case, the court held that the insured was entitled to have insurer share in legal fees and expenses (Philip v. Liberty Mut. Ins. Co., 253 A.2d 502 (Del. 1969)).

Made Whole Doctrine

Reluctant to apply Made Whole, especially where the plan disclaims it. Bill Gray Enter., Inc. Emp. Health & Welfare Plan v. Gourley, 248 F.3d 206 (3rd 2001)

Common Fund

Yes. Court has held that the insurer should pay its share of legal fees and expenses but did not get into how that should be calculated (Philip v. Liberty Mut. Ins. Co., 253 A.2d 502 (Del. 1969)).

Collateral Source Rules

Traditional common law rule applies

“Double recovery” is allowed through collateral source rule as long as the insured paid some sort of consideration in order to get tcohe benefit provided, i.e. paid an insurance deductible or some fee before insurance would cover the expenses (State Farm Mut. Auto. Ins. Co. v. Nalbone, 569 A.2d 71 (Del. 1989)).

Statutes

  • 21 Del. C. 2118, the no-fault auto insurance statute says that when a health Insurer pays the medical bills related to an injury that should be covered by no-fault auto Insurer, the health insurer has a subrogation right.
  • Balance Billing: out of network physicians are prohibited from balance billing patients when the patient’s insurer issues a referral to the non-network physician (18 Del. C. §3348)

Hospital Lien Act

  • 25 Del. C. §4301 gives hospitals a lien upon all claims arising out of personal injuries
    • Hospital must file written notice with the office of the prothonotary and send notice to all interested parties (25 Del. C. §4302)

Medicaid Statute

  • 31 Del. C. §522: After the deduction of applicable attorney fees and litigation costs, any funds received by the benefits recipient shall be held for the benefit of the Department of Health and Social Services in the amount of any payment made by the department. Department must notify recipient of a possible subrogation claim
    • Department’s reimbursement will be reduced by pro rata share of attorney’s fees: Where recipient’s total recovery exceeds the benefits paid by DHSS, the legislature intended an apportionment of reasonable attorney fees and litigations costs b/t the state and the claimant (Jeffries v. Kent County Vocation Technical School Dist. Bd. Of Educ., 743, A.2d 675 (Del. Super. 1999)) (this case deducted 1/3).

Additional Cases

Yarrington v. Thornburg 205 A.2d 1 (1964)). The collateral source rule says that a tortfeasor cannot lessen his liability based on benefits paid to the injured person by the tortfeasor’s Insurer. Here, the Delaware Supreme Court allows tortfeasor to discount payments already made to the injured person by the tortfeasor, or a fund created by the tortfeasor. The Court says the insurance policy paid for by the tortfeasor counts as a “fund created by the tortfeasor” for the purpose of paying the injured person.

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