State Emloyees Lien Statute REVISED!!!(ALMOST)

     Hurray!!!  The NC Teachers & State Employees Lien has moved one step closer to being revised to allow for attorney fees and to limit the scope of the lien.  There bill came out of the Senate technical corrections committee yesterday and can be found here.  Now we have to wait for the house to either give it a thumbs up, or a thumbs down.  That might happen on Monday.

     In the mean time, what will the new bill mean? 1)  The SEHP can never take more than 50% of the GROSS settlement.   2)  The SEHP must then reduce their recovery for "reasonable" attorney fees.  3)  SEHP must also pro-rate with unpaid medical providers and other lien holders.

     Why is this better?  Well before, the SEHP could have taken 100% of any settlement, but they were administratively limiting themselves to 50% of gross, but not reducing for attorney fees.   This mean that in a typical personal injury case, the client only received 15% of the settlement.  NOT FAIR.

     We've been waiting for this bill to pass for a very long time.  I'VE been working to get this bill passed since 2004 when it was enacted.  After a lot of work with NCATL we drafted, redrafted, negotiated, and redrafted, we finally got something passed.  Hurray!

Comments

[robert]

Now I can finally send them all the money I've been holding in trust. How should I approach them with the reduction for attorney fees?

[Chris Nichols]

That's a good question. The SEHP knew this was coming so we would hope that they told their collections staff to expect this.

I'd recommend that you do the normal lien requests, then when you get their letter and the "final pay" amount, you simply write them a letter, show them your "math" and ask then to confirm, in writing, that your attorney fee reduction is "reasonable".

The statute gives them final say on what is reasonable, but we've been told that 1/3 will be considered reasonable. Now we have to wait and see if that turns out true in the actual application.

Chris Nichols

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