SAN FRANCISCO (KGO) -- Fire victims receiving money from a PG&E settlement were appalled to learn thousands of dollars in medical liens are being deducted from their payments.
In many cases, the money is only being held back temporarily, but some are questioning the amount held back and what they say is a lack of transparency around the process.
For Teresa Northam, the only thing more difficult than fleeing the 2018 Camp Fire was returning home.
"That was pretty devastating," said Northam, taking a deep breath in.
"Everything on the property was destroyed," she continued.
Last spring, Northam and her husband, Michael, began looking for a contractor to rebuild.
"We have to try and manage building our home and the cost of that with what comes in," said Northam.
But when the Northam family's most recent PG&E settlement payment came in, they learned approximately $14,000 of it was being held back for medical liens.
"I was angry and we were appalled," said Northam.
Appalled because, while the Northams knew fire victims could be subject to medical liens, the couple's attorney says they were not told exactly how much would be held back, despite asking.
"The Trust has a formula that it uses it hasn't been totally transparent on how it calculates the lien holdback amount," said Josh Watson, the attorney for the Northam family.
According to the Fire Victim Trust website, a medical lien occurs when a health care insurer or payer like Medicare, Medicaid or the Department of Veterans Affairs pays for medical services related to a personal injury or emotional distress claim for a particular victim.
If that fire victim has an approved personal injury or emotional distress claim, the healthcare insurer or payer may be entitled to reimbursement for payments it made.
That reimbursement would come from a claimants' individual settlement award.
Matt Garretson of Wolf Garretson is the lien resolution administrator for the Fire Victim Trust. Through email and phone communications with ABC7 News, Garretson said money is held back while liens are in the process of being researched, finalized and resolved.
When the final Lien amount is determined, the Trust uses the withheld funds to pay the lienholder. If there are any remaining funds, that money is paid to the claimant.
Garretson says, barring any complications, Medicare and private health care plans take approximately 90 days to verify if a claimant has a medical lien obligation. California Medicaid targets 180 days to provide this verification.
The Trust has outlined the maximum "hold back" amount as 33% of the sum of the payments made to a claimant to date.
But Josh Watson, the Northam family's attorney, says that cap doesn't tell victims exactly how much money will be held back for medical liens at the time they must decide whether or not to accept a settlement determination from the Trust.
"People had made plans thinking well I'm going to receive a certain amount and then they wouldn't get that and then they would worry, 'Am I going to be able to fix the roof, am I going to be able to replace the furniture, am I going to be able to rebuild my business,'" said Watson.
Watson says knowing up front exactly how much money will be held back for medical liens might prompt some fire victims to turn down their settlement offers and ask for more money.
"The problem for the clients is that there's a sticker shock," said Watson.
Garretson says if a fire victim has received little to no medical treatment as a result of the fire, their lawyer should be able to assure them that the lien amount, if any, will be well below the holdback amount.
The alternative Garretson says is to wait to pay claimants until after the final lien amounts are determined, which he says, no one wants.
Camp Fire survivor Bridgette Culleton had her entire most recent settlement payment, approximately $18,000, held back for medical liens.
"It's very frustrating," said Culleton.
"When you don't have that money that you're able to rebuild with or replace things with it makes it really difficult," she continued.
ABC7 News began inquiring about Culleton and Northam's medical liens last week.
Watson says shortly after he learned all $14,000 of Michael Northam's holdbacks would be released this Friday.
"I first became aware of ABC's reporting on this on a Saturday morning and I shared that with the Trust promptly, and come Monday afternoon everything with my clients liens in this case had been resolved, so whether something was in motion or not I can tell you that once you got involved the communication became clear and the clients minds were put at ease and the situation got resolved," said Watson.
Garretson confirmed that all $18,000 of Culleton's holdbacks will also be released this Friday.
Watson says holdback releases like these speak to the good work the Trust is doing in eliminating and reducing medical liens, but at the same time, when no medical lien is ultimately owed, he questions the amount initially held back.
"That really is the issue... how do we get to such large lien hold backs for such little care," said Watson.
It's been a long road for fire survivors.
"I just want it to be over as soon as possible," said Culleton.
"It's a lot. It's really, really trying," said Northam.
A spokesperson for the PR firm hired by the Fire Victim Trust told ABC7 News by email that the Trust was not available to answer our questions regarding medical liens other than to refer us to the Trust's website.
"My biggest worry about the lien issue is that it erodes the trust that claimants have in the Fire Victim Trust it makes them think that the Trust is stacked against them," said Watson.
"The Trust is a good entity and sometimes it makes a misstep and that's what happened here with the liens," said Watson.
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