A personal injury patient comes in after a car accident. They have no health coverage that will pay for this treatment, or their attorney prefers that the bill wait for the case. The firm sends a letter of protection, and your practice now has a balance it will not collect until the case resolves, possibly a year or more away.
Most guides to letters of protection are written for patients or attorneys. This one is written for the medical practice that treats personal injury patients: what the practice receives, what to track from intake to settlement, and where the letter belongs in the patient's record.
This guide is general information, not legal advice. Letter of protection rules differ by state. Review your forms and process with a licensed attorney in your state.
What is a letter of protection?
A letter of protection (LOP) is a written promise, usually from the patient's personal injury attorney, that the treating provider will be paid from any settlement or judgment in the patient's case. The practice treats now and waits for payment until the case resolves, instead of billing the patient or an insurer up front.
Florida is one state that defines the term in statute. Section 768.0427 of the Florida Statutes defines a letter of protection as an arrangement where a provider treats "in exchange for a promise of payment" from a personal injury judgment or settlement, and it applies the definition to any such arrangement, whatever it is called. Other states use the term without a statutory definition, so the exact terms come from the letter itself.
An LOP is usually signed by the attorney, the patient, or both, and it is addressed to the practice. It names the patient, the case or date of injury, and how the provider's bill will be handled when the case closes. The specific promises, such as whether the patient stays responsible for the balance if the case is lost, depend on the wording and on state law.
How does a letter of protection work for a medical practice?
For the practice, a letter of protection turns one visit into a long case. The LOP is received and filed at intake, treatment is documented visit by visit, charges build on the case balance, records and bills go to the firm when requested, and payment arrives after the case settles or reaches judgment.
- Referral and intake. The patient arrives, often referred by an attorney or another provider. Staff record the date of injury, the attorney and the firm, and any health coverage the patient has.
- The letter is signed and filed. The practice receives the signed LOP, or asks the firm for one, before or at the first visit. A copy goes on the patient's case, not in a binder at the front desk.
- Treatment and documentation. Each visit is documented as usual. In an injury case, the notes later become evidence, so they need to show the injury, the treatment and the patient's response over time.
- Charges build on the case. Each visit and procedure adds to the balance the LOP covers. The practice keeps an itemized bill, not just a running total.
- Records and bill requests. The firm asks for records and an itemized bill, often several times during the case. Each release needs a valid patient authorization.
- Settlement and payment. When the case resolves, the firm contacts the practice about the final balance. Payment is posted against the case and the balance is closed or adjusted.
What is the difference between a letter of protection and a medical lien?
Both let a practice defer payment until a personal injury case resolves. A letter of protection is a contractual promise, usually from the attorney, that the provider will be paid from the recovery. A medical lien is a claim against the recovery itself, and in some states it is created or regulated by statute.
In practice, many clinics use the words interchangeably, and the line between them depends on state law and on the documents the patient and the attorney sign. The table below shows the usual differences. Treat it as a starting point and confirm how your state treats each.
| Letter of protection | Medical lien | |
|---|---|---|
| What it is | A written promise of payment from the settlement or judgment | A claim against the settlement or judgment proceeds |
| Who usually signs | The patient's attorney, often with the patient | The patient, sometimes acknowledged by the attorney |
| Where the terms come from | The letter's own wording, plus state law | State lien statutes in some states, or the signed lien document |
| When it is usually signed | At or before the first visit | At or before the first visit |
| What the practice tracks | The signed letter, the itemized balance and the firm contact | The signed lien, any required notice, the balance and the firm contact |
What should a practice track on every letter of protection case?
Track the signed letter, the attorney and firm, the date of injury, every charge as an itemized and coded bill, each records release and its authorization, any health coverage the patient has, and the case status. Together these let staff answer a firm's request without searching email, fax and spreadsheets.
| What to track | Why it matters | Where it should live |
|---|---|---|
| Signed letter of protection | It is the basis for deferring payment. Some states require it to be disclosed in the lawsuit. | On the patient's case, as a signed document |
| Attorney, firm and case contact | Requests, updates and payment all go through the firm. | On the case, linked to the patient |
| Date of injury and type of accident | It ties treatment to the injury claimed in the case. | Intake, carried into the first note |
| Itemized, coded charges | Firms and defense counsel ask for itemized bills. In Florida, LOP bills disclosed in a lawsuit must be itemized and, where applicable, coded. | The case ledger, visit by visit |
| Health coverage at the time of treatment | Florida requires the claimant to disclose whether they had coverage when treated under an LOP. | Intake and the patient's billing profile |
| Records releases and authorizations | Under HIPAA, most releases to an attorney need a valid authorization. | On the case, with a log of what was sent and when |
| Case status | Staff need to know which cases are in treatment, in negotiation or settled. | The case record, updated as the firm reports changes |
| Settlement payment and any reduction | It closes the balance and shows what was collected. | The case ledger, posted against the balance |
Where should the letter of protection live in the patient's record?
The letter of protection should live on the patient's injury case, next to the clinical notes, the itemized bill and the records-release history, not in a paper binder or a separate spreadsheet. When the firm calls, staff should be able to see the letter, the balance and what was already sent in one place.
Many practices keep the clinical chart in the EMR and the LOP, the balance and the attorney contacts somewhere else. That split is where follow-up work comes from: a firm asks for an updated bill, and someone has to rebuild it from two systems.
A personal injury EMR keeps those pieces on one case. In Ambula, lien forms are signed on the patient's phone through digital intake before the first visit, and the referring attorney is attached to the case from day one. Charges for every visit and procedure sit on the case ledger next to the lien balance. When the firm asks, the Lawyer Portal shows them the case status and only the records and bills you approve.
