Arkansas just changed the rules for injury cases in a big way. With the passage of HB1204 in February 2025, now known as Act 28, your medical bills and insurance records have become more important than ever before. This new law fundamentally changes how much compensation you can receive for your medical expenses, making it critical to understand exactly what was paid versus what was billed.
What HB1204 (Act 28) Means for Your Arkansas Injury Case
On February 11, 2025, Governor Sarah Huckabee Sanders signed HB1204 into law, creating Act 28. This new legislation dramatically changes how medical expenses are calculated in Arkansas personal injury cases. The law affects every type of civil case where someone was injured, from car accidents to slip and falls to cases involving serious harm like sexual assault or human trafficking.
The New Rule: Paid Amount vs. Billed Amount
Under Act 28, you can now only recover the amount that was actually paid for your medical care, not the full amount that was originally billed.
This is a massive shift in Arkansas personal injury law.
Here’s how it works: if you receive a hospital bill for $100,000 but your health insurance company negotiates and pays only $50,000 as the final settlement with the hospital, you can now only recover that $50,000 in your injury claim.
Before this law, you could have recovered the full $100,000 billed amount. The difference between what’s billed and what’s actually paid can be enormous, especially with major medical treatment like surgery, extended hospital stays, or ongoing care.
This means that people with good health insurance are now in a position where their insurance company’s negotiating power actually reduces their injury compensation. The better your insurance is at negotiating lower rates with medical providers, the less money you can recover from the person who hurt you.
Your insurance records showing what was actually paid have become the single most important factor in determining your medical damages.
Without detailed documentation of every payment, negotiation, and final settlement between your insurance and your medical providers, you won’t be able to prove what you’re entitled to recover.
Why Act 28 Makes Your Insurance Records Critical
Before Act 28, your medical bills alone told most of the story.
Now, your insurance records are just as important, if not more so.
You need documentation showing what your insurance company actually paid to each medical provider, what discounts or adjustments were made, and what the final negotiated amount was for each service.
These Explanation of Benefits (EOB) statements from your insurance company are now essential evidence in your case. Every EOB shows the billed amount, the allowed amount, what the insurance paid, and what you paid out of pocket. All of these numbers matter now.
Your insurance records also need to show any amounts that remain unpaid and for which you or a third party is legally responsible. Act 28 allows recovery of unpaid amounts only if someone is actually obligated to pay them. This creates a complicated situation where you need to track not just what was paid, but what remains owed and who owes it.
Medical providers may have agreed to write off certain amounts as part of their contract with your insurance company. Those written-off amounts cannot be recovered under the new law because nobody is responsible for paying them.
The law also affects how medical liens work in Arkansas injury cases. When medical providers agree to treat you on a lien basis, waiting to be paid from your settlement, those unpaid amounts can still be recovered because you or the medical provider remains legally responsible for them.
However, you need clear documentation showing the lien agreement, the amount owed, and that the obligation to pay still exists. Without this documentation, insurance companies will argue that nobody is legally responsible for the debt and you can’t recover it.
How This Law Changes Your Case Strategy
Act 28 requires a completely different approach to building and proving your Arkansas personal injury case. The strategies that worked before February 2025 won’t get you full compensation anymore.
Document Everything From Day One
The moment you receive medical treatment after an accident, start collecting documentation. Don’t wait until you decide to file a claim or hire an attorney. Request copies of every medical bill as soon as you receive it. More importantly, request copies of every EOB statement your insurance company sends. Many people throw these away or ignore them because their insurance handles the payment. Under Act 28, these EOB statements are now critical evidence that determines how much compensation you can receive.
Keep a detailed log of every medical expense related to your injuries. Write down the date of service, the provider’s name, what treatment you received, the amount billed, the amount your insurance paid, and any amount you paid out of pocket. This personal record will help you track down documents later and ensure nothing falls through the cracks. Also, keep receipts for every co-pay, deductible payment, or coinsurance amount you pay. These out-of-pocket expenses are still recoverable because you actually paid them.
Understanding Insurance Negotiations and Write-Offs
One of the biggest impacts of Act 28 involves insurance company negotiations with medical providers. Most health insurance companies have negotiated rates with hospitals and doctors. When you receive care, the provider bills a certain amount, but your insurance company pays a much lower negotiated rate. The difference is typically written off by the medical provider as part of their contract with the insurance company.
Under the old law, you could recover the full billed amount. Under Act 28, you can only recover the negotiated amount that was actually paid.
This creates a situation where having good insurance can actually hurt your injury claim. A person with no health insurance might be held personally responsible for the full billed amount and could potentially recover more than someone whose insurance negotiated a lower payment. This seems to punish people for being responsible and carrying health insurance. However, it’s now the law in Arkansas, and you need to understand how it affects your case. Your insurance records showing these negotiations are the proof of what you can recover.
Tracking Unpaid Medical Bills and Legal Responsibility
Not all medical bills get paid immediately after treatment. Some remain unpaid while your injury case is pending.
Under Act 28, you can still recover unpaid medical expenses, but only if you or a third party remains legally responsible for paying them. This means you need documentation proving the debt exists and someone is obligated to pay it.
A statement from the medical provider confirming you owe the amount and they expect payment is helpful. If a medical provider has agreed to place a lien on your case and wait for payment from your settlement, you need a written lien agreement.
Watch out for situations where medical providers write off unpaid amounts. If you never pay a bill and the provider eventually writes it off as uncollectible, you can’t recover that amount under Act 28 because nobody is legally responsible for it anymore. The provider gave up trying to collect, which means there’s no legal obligation to pay. Your medical and insurance records need to clearly show which bills remain valid obligations versus which have been written off or forgiven.
What This Means for Different Types of Medical Coverage
Act 28 affects people differently depending on what type of insurance coverage they have. Understanding these differences helps you know what documentation you need.
Health Insurance Through Employment or Private Purchase
If you have traditional health insurance through your job or purchased privately, your insurance company likely has negotiated rates with medical providers. Your EOB statements will show the billed amount, the allowed amount under your plan, what the insurance paid, and what you paid.
Under Act 28, you can recover what the insurance actually paid plus what you paid out of pocket. You cannot recover the difference between the billed amount and the allowed amount because that difference was written off as part of the provider’s contract with your insurance. Keep every EOB statement. These documents now determine your medical damages.
Also, be aware of subrogation issues with health insurance. Even though Act 28 limits how much you can recover for medical expenses, your health insurance company may still have the right to be reimbursed from your settlement for what they paid. Arkansas follows the made-whole doctrine, which means your insurance company can’t seek reimbursement unless you’ve been fully compensated for all your losses. However, this creates a complicated calculation where you’re recovering less for medical expenses under Act 28 while your insurance company may still want repayment.
Medicare and Medicaid
Medicare and Medicaid set their own payment rates for medical services, which are typically lower than what providers bill. If you’re covered by Medicare or Medicaid, you can only recover the amount these programs actually paid for your care under Act 28. Medicare and Medicaid have strict rules about repayment from injury settlements. Medicare, in particular, has strong legal rights to recover what it paid for your accident-related care. Your Medicare statements showing what was paid become critical evidence, and you’ll need to resolve Medicare’s lien before you can settle your case.
Medicaid also has recovery rights, though Arkansas has specific rules about when Medicaid can seek repayment. Your Medicaid records showing what was paid for your injuries are essential documentation. Because Medicare and Medicaid payments are often significantly lower than standard insurance payments, people covered by these programs may recover less under Act 28 than people with private insurance, even though their medical bills might have been identical.
No Health Insurance
If you don’t have health insurance when you’re injured, you’re personally responsible for the full amount of your medical bills. Under Act 28, you should be able to recover amounts that remain unpaid and for which you’re legally responsible. However, this creates practical problems. Medical providers may be unwilling to wait for payment until your case settles, or they may send your unpaid bills to collections. If your medical debt goes to collections and gets settled for less than the full amount, you can only recover what you actually ended up paying.
Some medical providers will treat uninsured injury victims on a lien basis, agreeing to wait for payment from the settlement. This is actually beneficial under Act 28 because the full billed amount remains a valid debt for which you’re legally responsible. However, you need a clear written lien agreement. Also, be prepared for medical providers to potentially charge you more than they would charge an insurance company because they don’t have a contracted rate with you.
How Act 28 Affects Your Total Settlement
While Act 28 changes how medical expenses are calculated, it’s important to understand that this law only affects past medical expenses. Your injury case includes many other types of damages that are not impacted by this new law.
What Act 28 Does Not Change
The new law doesn’t affect your ability to recover compensation for future medical expenses, lost wages, loss of earning capacity, property damage, pain and suffering, emotional distress, or loss of enjoyment of life. These damages are calculated the same way they were before Act 28 passed. If your injuries require ongoing medical care, you can still recover the full estimated cost of that future care. An attorney can work with medical professionals to create a life care plan showing what treatment you’ll need and what it will cost.
Pain and suffering damages, also called non-economic damages, remain unchanged. These damages compensate you for the physical pain, emotional trauma, and reduced quality of life caused by your injuries. In many cases, pain and suffering damages are worth more than the economic damages like medical bills and lost wages. Act 28 doesn’t touch these damages, so a reduction in your medical expense recovery doesn’t necessarily mean a dramatically smaller total settlement. However, there’s often a relationship between medical expenses and pain and suffering damages, with higher medical bills supporting larger pain and suffering awards.
The Real Impact on Settlement Values
The practical effect of Act 28 is that settlement values in Arkansas injury cases will likely be lower than they were before February 2025, all other things being equal.
The reduction depends on the difference between what was billed and what was actually paid for your medical care. In cases involving extensive hospital care, surgery, or long-term treatment, this difference can be tens of thousands of dollars or more. For someone with good health insurance that negotiated a 50% discount with medical providers, Act 28 could cut the medical expense portion of their settlement in half.
This makes it even more important to fully document and pursue all other aspects of your damages. If your medical expense recovery is lower, you need to ensure you’re being fully compensated for lost wages, future medical needs, and pain and suffering. Strong medical documentation actually becomes more important under Act 28, not less. You need detailed medical records proving the extent of your injuries, the treatment you required, and how the injuries affected your life. These records support your claims for pain and suffering and other non-economic damages that Act 28 doesn’t limit.
Common Mistakes That Now Have Bigger Consequences
Mistakes that might have only slightly hurt your case before Act 28 can now cost you thousands of dollars in lost compensation.
Not Requesting and Keeping EOB Statements
Many people never look at their Explanation of Benefits statements from their insurance company. They assume if the insurance handled the payment, that’s the end of it. Under Act 28, these EOB statements are now essential evidence in your case. If you can’t prove what your insurance actually paid, the insurance company defending the injury case will argue for the lowest possible number. Insurance companies have been known to conveniently “lose” records or claim they can’t find documentation of what was paid. If you have your own copies of every EOB, you can prove exactly what was paid and protect your compensation.
Request copies of all EOBs related to your accident injuries as soon as you receive them. Don’t wait until months later when you’re trying to settle your case. Medical providers and insurance companies only keep records for a certain period, and getting older documents becomes increasingly difficult. Also, you or your attorney can request a complete history of payments from your health insurance company, but this can take time and the records may be incomplete. Having your own set of documents from the start gives you the best chance of recovering full compensation under the new law.
Failing to Document Out-of-Pocket Expenses
Every dollar you pay out of pocket for medical care is still fully recoverable under Act 28. This includes deductibles, co-pays, coinsurance, and any bills you paid entirely on your own. If you don’t keep receipts and records of these payments, you can’t prove you made them. Save every receipt, even for small amounts like $20 co-pays. These add up quickly over the course of treatment for serious injuries. Also, keep records of travel expenses to and from medical appointments. While mileage and parking fees aren’t affected by Act 28, they’re still compensable damages that many people forget to claim.
Create a system for organizing these receipts from the beginning. A simple folder or envelope where you immediately put every receipt works fine. Make copies of everything so if the original is lost, you have backup documentation. Some people take photos of receipts with their phone as an additional backup. The key is creating a habit of saving every piece of financial documentation related to your injuries.
Not Understanding Lien Agreements
When you agree to let a medical provider treat you on a lien basis, make sure you get the agreement in writing. The lien should specify the services being provided, the cost, and that the provider agrees to wait for payment from your settlement. Under Act 28, these lien amounts are recoverable because you remain legally responsible for them. However, without proper documentation, insurance companies will challenge whether a valid lien exists or whether you’re truly obligated to pay the amount claimed.
Be careful about informal arrangements where a medical provider says they’ll wait for payment but nothing is put in writing. These informal agreements can create disputes later about whether a legally enforceable obligation exists. Also, understand that some medical providers charge higher rates when treating patients on a lien basis because they’re taking on more risk by waiting for payment. While these higher charges are recoverable under Act 28 if properly documented, they may be challenged as excessive or unreasonable.
Need Legal Help After an Injury?
Act 28 has changed the game for Arkansas injury cases, making your medical bills and insurance records more important than ever. The difference between what was billed and what was actually paid can mean thousands of dollars in your settlement, and proving exactly what was paid requires detailed documentation and knowledge of the new law.
As a personal injury law firm in Arkansas, we at Shamieh Law are ready to help you handle every aspect of your case under the new rules. We get to work quickly on your case, treat every client like family, and fight to get you every dollar you deserve under Arkansas law.
Don’t let Act 28’s complicated new rules cost you the compensation you need to recover from your injuries. Contact Shamieh Law today by calling 501-361-1334 to discuss your case and learn how we can help you pursue full compensation under Arkansas’s new personal injury law.