Jean Dedmon v. Debbie Steelman
535 S.W.3d 431
| Tenn. | 2017Background
- Jean Dedmon was severely injured in a 2010 automobile accident; her complaint attached itemized medical bills totaling $52,482.87 and a treating neurosurgeon testified those bills were reasonable and necessary.
- After West v. Shelby County Healthcare Corp., 459 S.W.3d 33 (Tenn. 2014) (interpreting Tennessee’s Hospital Lien Act), defendants moved in limine to exclude Dedmon’s full, undiscounted bills and to admit only amounts actually paid by her insurer.
- The trial court granted the motion, relying on West; the Court of Appeals reversed, holding West was limited to the Hospital Lien Act and that full bills were admissible in personal-injury cases.
- This Court granted permission to appeal to decide (1) whether West’s definition of “reasonable charges” applies to personal-injury damages and (2) whether Tennessee should adopt the “actual amount paid” or other approaches that would limit recoverable medical expenses to insurer-paid, discounted amounts.
- The Supreme Court of Tennessee held West is limited to the Hospital Lien Act, reaffirmed the long-standing collateral source rule in personal-injury cases, allowed admission of full, undiscounted bills to prove reasonable medical expenses, and barred defendants from introducing evidence of insurer discounts that would reveal collateral-source benefits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does West’s definition of “reasonable charges” for the Hospital Lien Act apply to measuring “reasonable medical expenses” in personal-injury cases? | Dedmon: West was limited to the HLA; personal-injury reasonableness is a fact for the jury. | Defendants: West’s reasoning should apply generally—full bills are unreasonable; only insurer-accepted amounts are recoverable. | West is limited to the HLA; it does not control personal-injury damages. |
| May defendants introduce evidence of amounts actually paid by insurer (discounts/write-offs) to rebut the reasonableness of full medical bills? | Dedmon: Collateral source rule bars admission of insurance payments or write-offs; defendants may rebut reasonableness with other competent evidence but not insurer discounts. | Defendants: Discounts are market evidence of reasonable value and should be admissible (or West compels it). | Defendants may not introduce insurer-accepted discounted amounts (doing so would violate the collateral source rule). |
| Should Tennessee abandon or modify the collateral source rule (e.g., adopt "actual amount paid" or hybrid approaches)? | Dedmon: Preserve collateral source rule—tortfeasor should not benefit from plaintiff’s collateral benefits; value questions remain for factfinder. | Defendants: Modern healthcare pricing justifies limiting recovery to amounts medical providers accept; collateral source rule outdated and unfair. | Court declines to alter Tennessee law; collateral source rule remains in personal-injury cases. |
| If full bills are admissible, what evidence may defendants use to challenge reasonableness? | Dedmon: Defendants may use any competent evidence on necessity/reasonableness that does not reveal collateral-source payments. | Defendants: Want to use insurer payments as primary proof of market value. | Defendants may offer other competent rebuttal evidence, but not insurer discounts or evidence revealing collateral-source benefits. |
Key Cases Cited
- West v. Shelby Cty. Healthcare Corp., 459 S.W.3d 33 (Tenn. 2014) (construed “reasonable charges” under the Hospital Lien Act as amounts accepted from private insurers)
- Fye v. Kennedy, 991 S.W.2d 754 (Tenn. Ct. App. 1998) (Tennessee precedent applying the collateral source rule and allowing recovery of full billed medical charges)
- Howell v. Hamilton Meats & Provisions, Inc., 257 P.3d 1130 (Cal. 2011) (adopted “actual amount paid” approach; influential but not adopted by Tennessee)
- Mollison (The Propeller Monticello) v. Mollison, 58 U.S. (17 How.) 152 (U.S. 1854) (early U.S. articulation of the collateral source principle)
- Anderson v. Miller, 33 S.W. 615 (Tenn. 1896) (early Tennessee application of the collateral source concept)