I'm sorry for your situation.
It shouldn't take 3 years to settle such a claim - but, you must protect your rights - thus, you will need to make certain you review the laws for your state - as you must pursue this within a certain time period (statute of limitations).
You can respond to the letter - by sending them a letter, via certified mail, return receipt requested, and advise them that you wish for them to expedite the handling of this matter. You can send them copies of all documentation. Ask them to please contact you after they have a chance to review the documentation and/or no longer than 30 days, otherwise, you will seek legal remedies.
If you wish, you can consult with a paralegal's office or an attorney if you do not hear back from them within 30 days - to protect your rights. It's not necessary to pursue a legal small claims action, immediately, until you receive a response to your letter. You need to know where you stand. They may just very well settle. You should also contact your insurance carrier (claims department) - being that they paid, they will be subrogating against wal-mart. Your claim's representative will further guide you on how to handle this matter.
Hope this helps.
Peace, Love & Happiness,
The Mystic Wave
Information provided herein is based on my 30 years experience as a legal secretary/paralegal in the State of California, with experience and knowledge in the State of Nevada. This information is not intended to substitute for informed professional legal advice from a practicing, licensed attorney.