New York Medical Lien Law for Outpatient Providers (2026)

New York gives a statutory lien to certain hospitals only. Physicians, chiropractors, physical therapists and other outpatient providers have no lien statute to rely on. In car-accident cases, outpatient providers are paid mainly through no-fault benefits at fee-schedule rates, and in other cases they depend on a written assignment of proceeds signed by the patient.

At a glance

Question	Answer
Statutory lien for outpatient providers	No. The lien law covers charitable hospitals, SUNY, and county, city, town and village hospitals only.
Main law	N.Y. Lien Law § 189 (hospital liens)
What outpatient providers usually rely on	In auto cases, no-fault benefits paid directly to the provider on an assignment of benefits. Otherwise, a written assignment of case proceeds signed by the patient.
Notice or filing	Hospitals only: mailed notice to the liable party before payment, plus a verified notice filed with the county clerk. There is no filing system for outpatient providers. In auto cases, no-fault claim deadlines apply instead.
Limits on the amount	Hospital lien: reasonable charges at cost rates, and void if the recovery is $300 or less. Auto no-fault: charges capped at the workers' compensation fee schedule.
Health insurance and billing the patient	Auto: no-fault pays first, up to $50,000. Providers may not charge above the fee schedule, and a provider with a no-fault assignment may not pursue the patient for services denied as medically unnecessary.
Billed vs. paid in the case	No "paid or incurred" statute. After a verdict, the court may reduce the award by collateral-source payments (CPLR 4545). In auto cases, losses covered by no-fault cannot be recovered in the lawsuit.
Recent changes (2023–2026)	Consumer Litigation Funding Act (Ch. 645 of 2025) regulates pre-settlement funders. No change to provider lien rules found.

Is there a lien law for outpatient providers?

No. N.Y. Lien Law § 189 gives a lien to three kinds of hospital: charitable hospitals supported wholly or partly by charity, the State University of New York, and hospitals run by counties, cities, towns and villages. The lien covers emergency treatment or admission for an injury caused by someone else's negligence, where the injury happened within one week before treatment or admission. Physicians and other practitioners are not named.

The New York State Bar Association's ethics committee has said it found no common-law or statutory lien for doctors' medical services in New York (NYSBA Ethics Op. 717).

The hospital lien does not apply to workers' compensation awards or settlements, or where the amount paid to the injured person is $300 or less.

Car accidents run through no-fault

In a motor vehicle case, "basic economic loss," which includes necessary medical expenses, is covered by first-party no-fault benefits up to $50,000 per person (N.Y. Ins. Law § 5102). The no-fault insurer pays the provider directly only if the patient assigns benefits on the prescribed forms (NF-3, NF-4, NF-5 or NF-AOB) (11 NYCRR 65-3.11).

The no-fault insurer has its own lien on a recovery against a non-covered person for benefits it paid or must pay (Ins. Law § 5104(b)). That lien belongs to the insurer, not the provider.

Notice and filing

Outpatient providers have no lien to file. For hospitals, Lien Law § 189 works like this:

The hospital sends notice by registered or certified mail to the party alleged to be liable, with a copy to its liability insurer if known, before any payment is made to the injured person or the patient's attorney.
After discharge, the hospital files a verified notice of lien with the county clerk, showing total charges, and mails it the same way.
Once filed and mailed, a release signed by the patient does not defeat the lien. A payer who ignores it stays liable to the hospital for one year after the hospital learns of the payment.
The lien lasts ten years and can be renewed.

In auto cases, the deadlines that matter for outpatient providers are no-fault claim deadlines. The mandatory personal injury protection endorsement requires written notice of claim within 30 days of the accident, and proof of claim for health services within 45 days after the services are given, unless the delay is excused with "clear and reasonable justification" (11 NYCRR 65-1.1).

Limits on what the provider is paid

Hospital lien: reasonable charges "at cost rates," no more than the total in the filed notice. If charges are disputed, a court can set the amount after a hearing. Charges that match the hospital's workers' compensation rates are presumed reasonable. The hospital lien ranks below the patient's attorney's lien.
Auto no-fault: charges for health services may not exceed the workers' compensation fee schedules, and providers may not "demand or request any payment" beyond what the law allows (Ins. Law § 5108).

Lien agreements and letters of protection

We found no New York statute on letters of protection. N.Y. Gen. Oblig. Law § 13-101 bars assigning a claim to recover damages for personal injury. Provider arrangements in New York therefore usually take the form of a patient's written assignment of part of the proceeds of the case, or a lien letter acknowledged by the patient's attorney.

The NYSBA ethics committee treats providers who hold "valid assignments or liens against proceeds" as third parties entitled to the funds (NYSBA Ethics Op. 946).

The attorney's duty to pay the provider

Two bar ethics opinions set out what the patient's attorney must do with settlement money:

NYSBA Ethics Op. 717 (1999): if a provider holds an undisputed valid statutory lien or an assignment from the client, the attorney should pay the provider directly from the settlement. If the client disputes it, the attorney holds the disputed amount, pays out the rest, and may ask a court to decide (interpleader). A provider with neither a lien nor an assignment is an ordinary creditor, and the attorney need not put it ahead of the client.
NYSBA Ethics Op. 946 (2012): repeats that providers "who have valid assignments or liens against proceeds" are entitled to receive funds, but unsecured providers the client objects to are not. With clear client instructions, the attorney may pay a named third party.

Health insurance, no-fault and billing the patient

Auto cases: no-fault pays first for basic economic loss up to $50,000. A provider that takes an assignment must bill no-fault within the 45-day window and is limited to the fee schedule.
Pursuing the patient after a no-fault denial: the Department of Financial Services' Office of General Counsel concluded that a provider holding a no-fault assignment may not pursue the patient for services denied as medically unnecessary, even if the assignment says the patient will pay. Under the standard NF-3 and NF-AOB language, the provider may pursue the patient only when the denial is based on lack of coverage or a policy violation caused by the patient's own conduct (DFS OGC Op. 06-05-07).
Non-auto cases: we could not confirm in a primary source whether a provider must bill the patient's health insurance before relying on a lien agreement.
Health insurer reimbursement: Gen. Oblig. Law § 5-335 presumes a personal injury settlement does not include amounts a health insurer paid or must pay, and bars most insurer reimbursement claims, with exceptions for certain no-fault, Medicare, Medicaid and workers' compensation claims. It does not address provider liens.

Billed vs. paid medical damages

New York has no "paid or incurred" statute. Under CPLR 4545(a), after the verdict the court may reduce the award for medical and other economic costs by amounts covered by a collateral source. The reduction is offset by premiums the plaintiff paid for two years before the claim and the projected cost of keeping the coverage. Life insurance and sources with a statutory right of reimbursement are excluded. The plaintiff may still prove the full loss at trial.

In auto cases, the plaintiff cannot recover in the lawsuit the basic economic loss covered by no-fault (Ins. Law § 5104(a)). The first $50,000 of medical bills is paid by no-fault, not the liability claim.

We could not confirm in a primary source how New York courts treat provider write-offs or discounted health plan payments under CPLR 4545.

Recent changes

The Consumer Litigation Funding Act (S1104-A, signed as Chapter 645 of 2025 on December 19, 2025) took effect 180 days after signing. It regulates consumer litigation funding companies. It bars referral fees involving medical providers, chiropractors and physical therapists, and gives Medicare and other statutory liens priority over the funder's lien. Its list of excluded parties does not include health care providers.

We found no 2023–2026 amendment to Lien Law § 189, Gen. Oblig. Law § 5-335 or CPLR 4545.

What this means for your practice

No New York statute gives a chiropractic, PT, pain, orthopedic, neurology or imaging practice a lien. The protection is a signed assignment of case proceeds from the patient.
In car-accident cases, no-fault comes first. Providers paid directly need the patient's assignment on the NF-3 or NF-AOB form, must submit claims within 45 days of service, and are paid at fee-schedule rates.
A provider with a no-fault assignment cannot charge the patient above the fee schedule, or pursue the patient for no-fault denials based on medical necessity.
Under NYSBA ethics opinions, the patient's attorney must pay providers that hold a valid assignment and must hold disputed amounts. A provider without a signed assignment is an ordinary creditor.
Hospital liens under § 189 apply to hospitals only and do not help freestanding outpatient practices.
Collateral-source reductions after verdict under CPLR 4545 can shrink the fund available to pay providers.

Sources

How we verified: statutes and the 2025 bill were read on the New York State Senate's official legislation site, regulations on Cornell LII's copy of the official rules, ethics opinions on nysba.org, and the DFS opinion on dfs.ny.gov, all checked November 12, 2026.