In an interesting case under the Healthcare Services Lien Act, calculation of healthcare liens rising from a personal injury suit was decided by the Court of Appeals.
In the case of Stanton v. Rea, the plaintiff was a passenger in a car driven by someone named Rea, when Rea’s car collided with a car driven by Roe. Plaintiff filed suit, incurred hospital bills over $4,000.00. The case went to trial against one of the negligent drivers. The jury awarded damages in the amount of $13,506.80. The trial court entered judgment for that amount plus $3,919.79 in costs. The out of pocket expenses to bring the case to trial had risen to $4,501.44, which included deposition fees. Ultimately, there was a check issued in the amount of $14,520.86.
The reader should note in this case it is unclear why the check was issued for $14,520.86. It does not seem to be supported by the judgment and the costs involved in the case. It is unclear where this amount came about. Nevertheless, it is apparently the amount that the court is using. Regardless of the amount, the language of the case is instructive as to what a plaintiff recovers in a case.
From the $14,520.86 there were liens from the following providers in the following amounts:
1)Union County Ambulance Service $137.08
2)Union County Hospital $3,821.89
3)Doctor Ronald Barr $569.22
4)Doctor Greg Zimmerman $586.64
5)Illinois Department of Public Aid $691.19
The Lien Act provides that lien claimants, for healthcare liens, cannot exceed 40% of the verdict. In this case, if one takes 40% of $14,520.86, the result is the $5,806.02 that the court came up with. The question becomes whether this should be taken from the gross verdict ($14,520.86) or whether the attorney’s fees and costs are deducted too. In this case, the attorney’s fees on $14,520.86 would have been $4,052.04. Additionally, the plaintiff would have had to pay the lawyer’s costs, which would have left the plaintiff with absolutely nothing.
The court interpreted the Healthcare Services Lien Act to decide that the plaintiff gets 30% of the judgment. The 40% calculation does not begin until costs associated with bringing the case to trial and securing the judgment have been deducted from the amount of the original verdict. The trial court should have begun its calculations for 40% for the lien holders after payment of attorney’s fees and costs necessary in securing the judgment. Accordingly, the math should have looked like this:
1) Union County Ambulance Service $137.08
2) Union County Hospital $3,821.89
3) Doctor Ronald Barr $569.22
4) Doctor Greg Zimmerman $586.64
5) Illinois Department of Public Aid $691.19
6) Attorney’s fees & costs $4,052.04
This is an interesting decision. The Healthcare Lien Act was set up to prevent the plaintiffs from getting nothing in cases where there are large costs and attorney’s fees associated with the claim. This preserves the plaintiffs ability to be paid something. After all, they are the ones that suffered. Additionally, the lawyer in this case spent a great deal of time and money going through a trial, appeal, and fronting $4,501.44 to collect what ended up being a small judgment in the amount of $13,506.80. If the Appellate Court does not uphold this, these cases are completely unfair to the plaintiff and result in smaller cases being completely nonviable from an economic standpoint.
Ackerman Law Office is available to handle personal injury cases involving car wrecks like the one above. If you have any questions or comments please feel free to contact Ackerman Law Office, P.C.