| Let's say that you are involved in a personal injury | | | | paid by the injury victim's health insurance company for |
| accident in San Francisco. Let's also assume that like | | | | her medical care. |
| thousands of other folks in the San Francisco Bay | | | | In other words, what does the difference between |
| Area you have private health insurance (mostly likely | | | | what was charged and what was paid represent? |
| through your workplace or employer). | | | | The Court answered - a benefit within the meaning of |
| So, you go to the hospital for your injuries, say San | | | | the collateral source rule. |
| Francisco General - and the good folks there send out | | | | To put this as simply as possible: in California, the |
| bills for one amount (what was charged) but accept | | | | collateral source rules states that collateral source |
| as payment from your insurance company another | | | | payments such as insurance or disability are irrelevant |
| amount (what was paid). | | | | in a personal injury trial. The bad guys don't get the |
| If you go to trial on your personal injury case, which | | | | benefit of the injury victim being responsible and having |
| amount do you get at trial (assuming you win of | | | | insurance. So, a jury is not allowed to hear about |
| course) - what was charged or what was paid? | | | | collateral source benefits like health insurance and an |
| Well, the Fourth Appellate District of California Howell v. | | | | award by a jury to an injury victim is not reduced |
| Hamilton Meats answered that question: the jury is | | | | because of such payments for her medical treatment. |
| able to award the injury victim what was charged. | | | | When a hospital negotiates with a health insurance |
| And assuming they do, you, the injury victim, are | | | | company and agrees to take less that what it would |
| entitled to obtain without reduction what was charged | | | | normally charge for its services, it is not out of the |
| by your hospital. | | | | goodness of its heart. It is because it is getting |
| The scenario that I outline above is one that has | | | | something for that reduction - a certain volume of |
| caused an endless debate between personal injury | | | | business, faster payments, advertising, all sorts of |
| attorneys (not just in San Francisco but across | | | | things. Those things - those in-kind benefits - are |
| California) and insurance defense counsel. | | | | benefits within the meaning of the collateral source |
| Personal injury attorneys, like myself, want the jury to | | | | rule. And when a hospital agrees to accept as full |
| hear, be able to award, and the injury victim to be | | | | payment the negotiated rate - meaning the injury |
| entitled to, what was charged. And insurance | | | | victim doesn't owe any additional amount - that too is |
| defense attorneys want the injury victim to be entitled | | | | a benefit within the meaning of the collateral source |
| to what was paid. | | | | rule. |
| The Court in Howell added their two cents by | | | | So, the Court ruled that you can't reduce the plaintiff or |
| examining the collateral source rule, its application, and | | | | injury victim's award by the difference between what |
| fully evaluating what resides in the gap between what | | | | was charged and what was paid because that |
| is charged by a hospital to an injury victim and what is | | | | difference is a collateral source benefit. So there! |