Because the legal world is complex, this most simple and important question requires a less-simple response. The framework used to determine how a settlement will be allocated is described below. The economics of the cases vary greatly, but as a general rule, there are a few buckets of entities that are entitled to a portion of the settlement funds. Everything left after the following groups are paid belongs to the client.


Payment of Medical Bills

If your case is one based on medical care, you are entitled to the fair value of the bills for that medical care. Those bills need to be paid or reimbursed out of the proceeds of the case, but how that will look depends on if and how those bills were paid in the first place. If the bills were not paid in the first place, your lawyer will work directly with the medical provider to pay those bills. If those bills were paid by another entity, such as private insurance, Medicare, Medicaid, or medpay, your lawyer will work with whoever paid the bills to reimburse that entity for the amount it paid. Another question that often comes up in this realm is why an entity such as private insurance is entitled to reimbursement when a client is paying (expensive) premiums every month. Because the value of the settlement to a client is often being driven by the amount of bills, if another entity is paying those bills on the client’s behalf, failing to reimburse the payor for the amount paid would result in a client receiving an unfair double recovery


Reimbursement of Costs

Your lawyer will often pay the costs associated with the case on your behalf while that case is pending. Your lawyer is entitled for the reimbursement of these costs. As a general rule, the costs necessary to pursue a case go up as the case gets closer to trial due to the type of work necessary to prepare a case for trial. Examples of costs include filing fees, court reporter fees, expert witness fees, and costs associated record retrieval.


Attorney Fees

Your lawyer is entitled to a percentage of the settlement, which is proportionate to the size of the recovery.


There are other interests that need to be accounted for, from time to time, but the big ones are above. A client is entitled to the balance once the above items are all taken care of.