NJ Car Accident Law: Even with Medical Benefits Coverage, Injured Drivers Still Have to Pay Out of Pocket Medical Expenses

Philip Ciprietti, NJ Car & Truck Accident Lawyer

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NJ car accident and insurance laws can be quite confusing. There are 2 things that many NJ drivers are mistaken about with regard to their medical benefits (PIP) coverage and expenses which will be addressed in this article:

1. Who pays for the medical bills after a NJ car or truck accident?

2. Even with PIP coverage, there are still out-of-pocket medical expenses injured drivers must pay.

Who Pays for Medical Bills After A NJ Car or Truck Accident?

NJ is a no-fault state. What that means is regardless of who caused the accident, an injured driver’s OWN car insurance company pays for the driver’s medical expenses incurred as a result of a car accident. Therefore, if a driver was rear-ended by a truck in Cherry Hill and was seriously injured, the truck driver’s auto insurance company would not pay for the injured driver’s medical bills. Rather, the driver’s own insurance company would pay pursuant to medical expense benefits (PIP) coverage. The medical expenses have to be reasonable, and PIP coverage will pay for in-patient and out-patient hospital visits, doctors’ visits, physical therapy, prescriptions, diagnostic tests such as x-rays, MRIs, CAT scans, and ambulance and medical transportation.

Related: Injured in a NJ Car Accident? – The Basics of Medical Benefit (PIP) Claims

Are there Out of Pocket Expenses After PIP Coverage?

Many drivers believe that once their car insurance companies pay for their medical expenses, their bills are covered 100%. Unfortunately, this is not the case. Just because an injured driver’s own car insurance company pays for medical expenses pursuant to PIP coverage, the injured driver still incurs out of pocket medical expenses.

There is a deductible that an injured driver must pay for the PIP medical coverage. This is akin to a deductible on a private health insurance plan. The PIP coverage does not kick in until the deductible is met. The default deductible for PIP coverage in a NJ auto policy is $250. However, a driver may choose to have a higher deductible, up to $2,500, in exchange for a lower premium.

Once the deductible is met, a driver may assume that he will not have any more out of pocket medical expenses. Again, this is not the case. There is a co-pay provision in PIP coverage, which requires an insured driver to pay 20% of the medical expenses, up to a limit, and the remaining 80% is paid by PIP benefits. This is also known as the 80/20 co-pay provision.

The deductible and co-pay provision apply to the first $5,000 of medical bills. Any medical bills above $5,000 are paid 100% by PIP benefits.

The chart below provides the amount an insured driver must pay for the first $5,000 of medical bills depending on his deductible choice.

Deductible ChoiceCo-payTotalFinancially Responsible Party


Related: What to Do After a NJ Car Accident on the NJ Turnpike and Other NJ Highways

Help After NJ Car Accidents in Cherry Hill, Marlton or Camden

As one can see from the above discussion, NJ car accident and auto insurance laws can be complicated. If you have questions about your NJ car accident and medical bills, call Philip T. Ciprietti, Esq. to schedule a FREE consultation. 800-281-8695

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