SAN FRANCISCO – In a civil court case involving medical bills, what is the
appropriate amount to award in damages, and how is that determined?
This is the question that the 2011 case of Rebecca Howell
v. Hamilton Meats brought to the California Supreme Court.
After a car accident, which resulted in injury, Howell purportedly incurred medical bills in the total amount of $189,978.63 – discounted to
$59,692.23 through an agreement with her health insurance company and the
health care providers.
Howell sued Hamilton Meats for the difference between the billed
rate and the amount that was actually paid, $130,286.23.
Supreme Court, however, ruled that an injured plaintiff who has health insurance is
limited to economic damages in the amount that they or their insurers paid for
medical services that they have received or bills that are still outstanding –
they are not entitled to the difference between the billed rate and the rate
that is actually paid.
In the original lawsuit, the trial court ruled that Howell
could recover past medical expenses in amounts no greater than what medical
providers accepted from Howell and her insurance company, as payment in full. An appeals court reversed the trial court’s
decision, and this was how Howell v. Hamilton Meats came to the state Supreme
Court in 2011.
people would think this is already a law,” Kim Stone, executive director of the Civil Justice Association of California, told the Northern California Record. “It feels
kind of common sense.”
When a car crash occurs, there’s a difference in the amounts
that are recoverable, depending on whether an individual has health insurance or
not, and depending on the type of insurance they have. Individuals who have health insurance through
government-funded programs can often show only amounts that their insurance programs
paid, and those are typically lower than what private insurance companies pay
out. The relationship between individual’s health care provider and their health
insurance company can also affect the amount that they pay.
“Most people would
think that your medical bill is what your medical bill says it is," Stone said. "Only a trial
lawyer would think your medical bills are a lesser percentage of what is
Stone said that this case sends a message; however, not to the
general public, but to the plaintiff’s attorneys in cases like Howell’s.
“Plaintiff’s lawyers take a percentage of a settlement," Stone said. "It’s the plaintiff’s lawyers that don’t like
this decision. Insurance companies would like this decision, because the overall
payout is what was paid."
The judges noted that the difference between what was billed
and what was paid in medical bills was not something that a plaintiff could recover,
because it is not a benefit to them -
they didn’t pay the difference, so they cannot get it back.
“It’s trying to give an unjustified windfall by artificially
inflating damages,” Stone said.
A later decision by the California Court of Appeal for the 2ond Appellate District, Division 3 stated that plaintiffs could not use the
evidence of the full amount billed as proof of damages, because they were not