New York State Anti-Subrogation Law

Last November, the governor of New York State signed an anti-subrogation law. The law bars any health insurer from seeking any reimbursement or subrogation against any settling party to a personal injury or wrongful death action with respect to benefits it may have paid or is obligated to pay.

The law took effect immediately and applies both to future actions and all pending cases that have not settled or gone to trial as of its signing. Proponents of the law say it will prevent insurance companies from “double dipping” — that is seeking reimbursement from injured people who have already paid premiums to the insurance company for coverage.

Basically, the new law means insurers in New York will not be able to collect reimbursement for medical care from a plaintiff who has successfully pursued a personal injury case in regards to an accident in New York State. The only exceptions to the law involve claims for which there is a statutory right of reimbursement (e.g., Medicaid, Medicare, workers’ compensation and certain “ERISA-funded” plans) and subrogation claims to recover excess no-fault benefits.

The new law was widely praised by consumer advocates, including the New York State Trial Lawyers Association, which issued a statement that read in part:

“This law is a major victory in protecting our injured clients against the proliferation of unwarranted claims for windfalls by way of subrogation and reimbursement asserted by health insurers in recent years. It will significantly facilitate the prosecution of our cases and remove major obstacles to their resolution.”