Letter of protection

What it is

A letter of protection (LOP) lets an injured client see a doctor, chiropractor, imaging center or surgeon without insurance payment, on the promise that the provider will be paid from the settlement or judgment. The term is common in states like Florida and Texas. In California the same arrangement usually takes the form of a lien agreement signed by the client and often acknowledged by the attorney.

The California rule

No statute governs these agreements, but case law shapes their value. Under Howell v. Hamilton Meats (2011), an insured plaintiff's past medical damages are limited to amounts paid or owed. In Pebley v. Santa Clara Organics (2018), the Court of Appeal held that a plaintiff who has insurance but chooses to treat on a lien may be treated as uninsured, so the full bill is relevant to the reasonable value of the care, which the defense can challenge with its own experts. Once a firm acknowledges a lien, the provider has a claim to the funds, and Rule of Professional Conduct 1.15 requires the firm to hold money in which another person has an interest in trust until the claim is resolved.

Why it matters to a plaintiff firm

Lien treatment gets clients care they might otherwise skip, but defense counsel will ask about referral relationships and argue the bills are inflated. Firms keep every lien agreement in the file, track each balance as the case moves, and negotiate reductions before disbursement. See medical lien reductions in California.