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Justices split on discounted medical expenses

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In a ruling about whether insurance discounts can be used to determine reasonable medical expenses, two Indiana Supreme Court justices say their colleagues have created a new rule that is "incomplete, misleading, and unfair" and will add "layers of complexity, time, and expense to personal injury litigation, impairing the efficient administration of justice."

In its 3-2 decision Wednesday afternoon in Brandon Stanley v. Danny Walker, No. 41S01-0810-CV-539, the majority held that those discounted benefits can be used to determine what's reasonable and actually paid by plaintiffs seeking damages for their injuries. That issue gives the court a chance to catch up with the modern managed health-care world.

Justice Frank Sullivan authored the opinion in the Johnson County case regarding a 2004 vehicle accident in which Danny Walker sustained injuries and ultimately received treatment from 11 different medical providers. He filed a negligence complaint against Brandon Stanley to recover incurred medical expenses, lost wages, and pain and suffering; Stanley admitted negligence before trial and the case proceeded on the damages issue.

The injured plaintiff, Walker, introduced medical bills totaling the original billed amount of $11,570; however he didn't show the $4,750 that was ultimately discounted by an agreement between the medical service providers and Walker's health insurer bringing the medical costs for which he and the insurance company were responsible to $6,820.

Disputing the originally billed amount because of the discounts, Stanley asked the trial court to admit the discounted medical bills totaling $6,820 into evidence, but Walker argued that violated Indiana's collateral source statute, Indiana Code § 34-44-1-2, which prohibits the introduction of "insurance benefits" evidence in personal injury cases. The court agreed and didn't allow the evidence, and the Court of Appeals affirmed in a decision last year that followed a $70,000 general verdict in Walker's favor.

In its ruling, the Indiana Supreme Court majority affirmed the judgment but remanded for the trial court to reduce the damage award by $4,750. The court noted that if Walker will not accept the reduction, he is free to retry the issue of damages before another jury.

Justice Sullivan adopted the approach in the Ohio Supreme Court decision of Robinson v. Bates, 857 N.E.2d 1195, 1200 (Ohio 2006), which held that a jury may determine the reasonable value of medical services is the amount originally billed, the amount accepted as payment, or some amount in between. That state's common law "collateral source rule" wasn't applicable to discounted bills because they weren't payments from a third party to the plaintiff, the court decided.

"We find this to be the fairest approach; to do otherwise would create separate categories of plaintiffs based on the method used to finance medical expenses," Justice Sullivan wrote, noting that parties can also introduce evidence and witnesses to show billed and paid amounts don't represent the reasonable value.

But Justices Brent Dickson and Robert Rucker dissented, saying the majority's holding contravenes the express requirements of Indiana's collateral source statute and is an "unfair and undesirable judicial policy."

With this rule, juries will receive a "distorted, misleading, and incomplete picture unless they are also able to consider the pecuniary value of all the benefits conferred upon health care providers in their symbiotic exchange with medical insurers," Justice Dickson wrote in his 9-page dissent. "... A new level of discovery will be needed to determine and quantify the value to providers. Plaintiffs will be required to expend considerable resources to marshal and present such evidence, thereby prolonging trials. New appellate issues will result.  ...

"This all seems very unnecessary," he wrote.

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  1. It appears the police and prosecutors are allowed to change the rules halfway through the game to suit themselves. I am surprised that the congress has not yet eliminated the right to a trial in cases involving any type of forensic evidence. That would suit their foolish law and order police state views. I say we eliminate the statute of limitations for crimes committed by members of congress and other government employees. Of course they would never do that. They are all corrupt cowards!!!

  2. Poor Judge Brown probably thought that by slavishly serving the godz of the age her violations of 18th century concepts like due process and the rule of law would be overlooked. Mayhaps she was merely a Judge ahead of her time?

  3. in a lawyer discipline case Judge Brown, now removed, was presiding over a hearing about a lawyer accused of the supposedly heinous ethical violation of saying the words "Illegal immigrant." (IN re Barker) http://www.in.gov/judiciary/files/order-discipline-2013-55S00-1008-DI-429.pdf .... I wonder if when we compare the egregious violations of due process by Judge Brown, to her chiding of another lawyer for politically incorrectness, if there are any conclusions to be drawn about what kind of person, what kind of judge, what kind of apparatchik, is busy implementing the agenda of political correctness and making off-limits legit advocacy about an adverse party in a suit whose illegal alien status is relevant? I am just asking the question, the reader can make own conclsuion. Oh wait-- did I use the wrong adjective-- let me rephrase that, um undocumented alien?

  4. of course the bigger questions of whether or not the people want to pay for ANY bussing is off limits, due to the Supreme Court protecting the people from DEMOCRACY. Several decades hence from desegregation and bussing plans and we STILL need to be taking all this taxpayer money to combat mostly-imagined "discrimination" in the most obviously failed social program of the postwar period.

  5. You can put your photos anywhere you like... When someone steals it they know it doesn't belong to them. And, a man getting a divorce is automatically not a nice guy...? That's ridiculous. Since when is need of money a conflict of interest? That would mean that no one should have a job unless they are already financially solvent without a job... A photographer is also under no obligation to use a watermark (again, people know when a photo doesn't belong to them) or provide contact information. Hey, he didn't make it easy for me to pay him so I'll just take it! Well heck, might as well walk out of the grocery store with a cart full of food because the lines are too long and you don't find that convenient. "Only in Indiana." Oh, now you're passing judgement on an entire state... What state do you live in? I need to characterize everyone in your state as ignorant and opinionated. And the final bit of ignorance; assuming a photo anyone would want is lucky and then how much does your camera have to cost to make it a good photo, in your obviously relevant opinion?

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