Medical Bills Are Not Reduced to the Amount Paid In Personal Injury Claims

 

 

The Illinois fourth District Court of Appeals decided, on July 15, 2016, in Miller vs. Sarah Bush Lincoln Health Center, that medical bills are not reduced to the amount paid by insurers in personal injury suits. This case creates a split in circuits because a different case entitled Perkey vs Portes -Jarol, from 2013 decides the opposite on virtually identical facts. In Perkey a party ask to appeal to the Supreme Court, but the Supreme Court denied leave to appeal. With this court case from the Fourth Circuit Court of Appeals there is a split in circuits, which suggests the Supreme Court will take this issue.

In Miller the jury returned a verdict in favor of the plaintiff on a medical malpractice claim. The jury awarded $638,347.91. Of that amount, $133,347.91 was represented plaintiff’s medical expenses. This defendant asked the court to enter judgment to reduce the jury’s verdict by $91,724.03. This would leave the Plaintiff with medical expenses recouped of $41,623.88. The court did so. The plaintiff appealed to the fourth District Court of Appeals. The $41,623.88 is the amount that the insurers paid. The remainder, $91,724.03, was written off.

In question is section 2 – 1205 of the Illinois court of civil procedure. The important part of 2 – 1205 provides that the defendants can get a reduction for 100% of the benefits “Which have been paid or have become payable to the injured person.” The court held that a write off by medical provider entitled to payment is the antithesis of a payment, by definition. It is not payable to anyone, least of all the injured person. The court held that the statute only allows a verdict to be reduced by the amount paid to the medical providers or payable to the plaintiff.

The trial court had relied on the Perkey case. (Perkey, 2013 Ill.App (2d) 120470, 1 N.E.3d 5) in Perkey the jury awarded plaintiff $310,000 for medical care. Blue Cross Blue Shield had paid $134,933.85. The defendant asked for reduction of $175,066.15, which the court allowed. Perkey is a Second District Court of Appeals case.

This is a big issue. Section 2 – 1205 the Code of Civil Procedure was passed in the 1970s. There were much fewer subrogation clauses then. The patient would pay directly and then be reimbursed by the insurance company. The defense wants to just pay what the health insurer has paid.

This leaves the injury victim not fully compensated. First, they have to pay attorney’s fees incurred to collect the medical bills, which go to somebody else. Second, their insurer secured the benefit of the bargain for the reduction for the bills. The tortfeasor should not be entitled to the benefit of the bargain of plaintiff’s insurer.

At Ackerman Law Office we keep up with recent case law developments. If you have a personal injury claim or medical neglect claim feel free to contact us. We handle these matters on a contingent fee, which means we only collect a fee if we win the case for you.