What is a letter of protection and how does it pay my Georgia medical providers?

· 3 min read

A letter of protection is a written promise, usually signed by an injured person’s attorney, that medical bills for accident-related treatment will be paid out of any future settlement or judgment. It lets a provider treat someone now and wait for payment until the injury case resolves, rather than demanding money up front or sending the account to collections. In Georgia, these arrangements are common when an injured person has no health coverage or cannot afford treatment while a claim is pending.

How the arrangement works

The letter functions as a payment deferral backed by the eventual recovery. The provider agrees to render care and hold the bill; in exchange, the attorney commits to paying the provider from the proceeds before the injured person receives the net recovery. The mechanics generally look like this:

  • The provider treats the patient and bills as usual, but does not pursue immediate payment.
  • The unpaid balance is tracked as part of the case’s medical specials.
  • When the case settles or a judgment is collected, the provider is paid from the settlement funds at distribution.

Because payment is tied to the recovery, the letter aligns the provider’s interest with the outcome of the claim without making the provider a party to the lawsuit.

Why injured people use them

Letters of protection solve a timing problem. Serious injuries often require treatment long before an insurer pays anything, and a delay in care can worsen both the injury and the claim. By securing treatment on a deferred basis, an injured person can get necessary care, document the injuries properly, and avoid the credit damage that comes from unpaid medical accounts in collections during a long case.

Practical cautions

These letters carry trade-offs worth understanding. Providers treating on a letter of protection sometimes bill at full rates rather than discounted insurance rates, which can leave a large balance to satisfy at the end. The amount owed is generally negotiable when the case resolves, and reducing inflated balances is a routine part of closing a file. A letter of protection also does not erase the underlying debt; it changes when and how the provider expects to be paid, and the obligation remains tied to the person who received the care.

The bottom line

A letter of protection lets a Georgia injury claimant obtain medical treatment on credit secured by a future recovery, with the provider paid from settlement or judgment proceeds at distribution. It bridges the gap between needing care and recovering money, but the deferred bills can be substantial and are often negotiated down before the case closes.

This article is for general educational and informational purposes only and is not legal advice. It does not create an attorney-client relationship, and Georgia law may change. For advice about a specific situation, consult a licensed Georgia personal injury attorney.

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