*1 SYSTEMS, BAPTIST HEALTHCARE
INC. d/b/a
Hospital, Appellant, al., Appellees. MILLER,
Golda H. et
No. 2003-SC-471-DG.
Supreme Kentucky. Court of
Aug. 25, 2005.
Rehearing Dec. Denied *2 Jenkins,
Grеgory Bailey, K. F. Allon Lynn Kolokowsky, Rikhoff Jenkins Pisaca- Bailey, no Lexington, Robinson & Counsel Appellant. Peters, Fred Ashley Rogers Dye, E. Lexington, for Appellees. Counsel Busald, E. Jay Andre’ R. Bus- Vaughn, PSC, Florence, aid Funk Zevely Counsel Curiae, Academy Kentucky Amicus Lawyers. Trial Stainback, Sullivan, Frank Mountjoy, Miller, P.S.C., Owensboro, Stainback & Curiae, Counsel Kentucky for Amicus De- Counsel, fense Inc. Price, Christian,
Stephen R. Carole D. Wyatt Combs, Louisville, Tarrant Curiae, Kentucky Counsel for Amicus Hos- Association, Inc. pital LAMBERT, Chief Justice. Healthcare, Appellant, Baptist Inc., Baptist Hospital appeals Central d/b/a Kentucky opin- from the Court of Appeals judgment ion affirming Fayette awarding Appellee, Circuit Court Golda $100,100 injuries Miller received as a negligence. result of As we discern continuing abuse trial court discretion in identify the case to Ms. allow Miller to expert, trial court error in Central denying Baptist’s summary judgment, motion for error, or other rеversible we affirm the Appeals Court Fayette Circuit Court. July
On Golda went to Miller Baptist Hospital to her blood Central have upon phle- Baptist’s phlebotomist order. The added that Central drawn her doctor’s employed by employer’s botomist1 to meet standard of failed her Hospital placed tourniquet Ms. Mil- in its employee training care as outlined arm, supervision left her ler’s without manual and The trial court deter- videos. *3 ten approximately for minutes. When widespread that due to the use of mined answering a phlebotomist returned from a phlebotomy, medical standard of specific room, telephone call in Ms. Mil- another mandatory and necessitated ex- care was arm had changed ler’s was swollen and testimony pert to establish whether that Miller, eighty years colors. Ms. who was trial standard of care was met. The court old, experienced complications mediсal thereby Baptist’s denied Central motion sought with her arm and treatment. After summary for a judgment allowed consultation, physicians con- three day identify Ms. Miller to continuance for experiencing cluded that Ms. Miller was expert an under 26. CR problems right with arm and nerve her began Septem- day jury A two trial on specifically related her condition to Dr. Michael Balm testified that ber 26. 18,1997. tourniquet of July incident injury specifically Ms. Miller’s nerve was brought negligence Ms. Miller a action of tourniquet July related to the incident against Baptist, and trial was ini- Central Baptist Hospital. Ms. 1997 Central tially April for scheduled Before expert witness Denise produced Miller tried, 9, 2001, April the ease was on Cen- Dunn, University with the phlebotomist a summary Baptist tral moved Kentucky employee of Cen- of and former grounds that on the Ms. Miller’s claim was that Baptist. tral Dunn testified she Ms. improperly negligence classified rather training phlebotom- in the of new assistеd malpractice. Baptist than medical Central Kentucky. University of She at the ists negligence claimed a medial re- that case a should never phlebotomist testified that phlebotomist testify an quired expert alone, tourniquet and that a patient a leave care, Ms. to the standard of and since arm one placed patient’s should be on a an expert did of provide Miller not notice if that a to three testified minutes. She not establish evi- phlebotomist she could patient’s a arm for tourniquet is on left care. On April dence the standard of minutes, may the blood more than three Fayette Court held Circuit whereby hemolyzed,2 process become hearing During on hear- the matter. that She stated He- “cells are crushed.” ing, argued counsel for Ms. Miller that improperly molysis is the result an ordinary negligence case was rather one and this is indicated sample blood negligence рhlebotom- drawn than medical since iron, potassium, cho- regulated are licensed or in Ken- elevated levels ists lesterol, portion This Ms. and bilirubin. tucky. support point, Ms. Miller dissolution, "[a]lteration, phlebotomist person phle- defined A trained in sis is botomy, as follows: "Inci- such a which defined blood cells in destruction or of red puncture sion into or needle of vein for the hemoglobin into the is liberated manner drawing process purpose This blood.” suspended, cells are medium in which the puncture venipuncture: also known as "The antibodies, fixing e.g., by specific complement vein, usually inject of a to withdraw blood or toxins, tonicity, agents, al- various chemical Dictionary a solution.” Stedman's Medical subsequent re- temperature teration of (27th ed.2000). hemoglobin.” Medical lease of Stedman’s (27th ed.2000). Dictionary produce hemolysis 2. "To or liberation hemoglobin Hemoly- from red cells.” blood testimony Dunn’s I. uрon based medi- publication published cal a seminar book Central contends by the National Committee Clinical (CR 56) summary judg entitled Laboratory provided Standards her em- alternatively ment or that a continuance ployer. She stated she had read this granted should been to Ms. Mil not have it. document but did understand Baptist argues ler. that at the produced
Central Baptist testimony summary judgment, time it Ms. moved Cynthia Applegate employee of Ms. expert testify and Miller had not named an laboratory phlebotom former director its inter- as to the standard of care of a *4 pret Ms. Miller’s blood test results. At ist. During hearing, the the issue was point, objected Ms. Miller’s expert testimony required counsel to whether was in case, testimony arguing any testimony phlebotomist negligence the that a or whether lab concerning report not summary judgment granted should be should be be admissible because it identify would constitute ex- causе the failed to pert testimony expert had Applegate following colloquy Ms. not witness. The oc an expert been disclosed as during hearing: witness until a curred day before trial. The trial ruled court that Appellee, Counsel ... Mr. Peters: I Applegate Ms. could read report from the a know I have nurse available. And I testify that there were no indications think qualified. she’s any problems drawn, with the blood but qualified I Court: don’t know who is prohibited her from interpreting the lab you who tell is not to the truth because report. person medical can and does draw trial, At the conclusion of the jury it, it, blood. Nurses do doctors do quote a in returned verdict favor of Ms. Miller phlebotomist, there people are some on damages $154,000. and awarded But hospital that nothing staff do but draw jury also found that Ms. Miller was 35 blood, you say but is no certifi- there percent comparatively negligent, and re- cation any- or licensurе for that that $154,000 duced the verdict from to body’s given anyme for. evidence It’s $100,100. In its motion for directed ver- training. I I really internal don’t think dict, Baptist Central sought limit to Ms. unregulated realized that such an recovery Miller’s only medical expenses sticking field. have People been needles actually to those that or payable, are my in I arm since don’t know... to but exclude contractual im- allowances require, Mr. Peters: Some states but posed payors. Central rea- Kentucky doesn’t. that it not soned should be held liable for medical charges major were neither nor Court: I think Which causes to problem able be collected. The trial court de- clearly in this trial. This is layed ruling clearly on the motion a verdict procedure. until medical It has medi- rendered. The trial consequences. experts court overruled cal He two has the motion limit damages going testify to on the that are to that the cause grounds considering equities problems drawing of her was that windfall, blood, Baptist’s negligence, anybody, don’t have what we is any, injured party, if go point, anybody should Ms. least identified at this is affirmed, Miller. The of Appeals experience testify Court with the and skill to granted discretionary and this Court done ... negligently re- that it was what proper view. standard of care would be for scientific, mony appropriate I to techni- drawing “[i]f blood and cannot leave that This . imagination jury. cal, specialized knowledge or other will something my opinion that the com- fact the trier of to understand assist ” lay person mon can sense answer. a fact in evidence determine issue.... honesty, Judge subject litiga- Mr. Peters: in all with If matter of an issue in people going out of town to be knowledge, expert tion is not common then .to get difficult it done next week. testimony is witnesses proper.4 Expert give jury going give ability Court: I’m Mr. Peters 30 to evaluate days get witnesses identified that his mal- party charged conduct of the they his And if prove will case chief. practice discipline.5 in the context of the you reports are not with- identified judge trial has wide discretion to ad- days you your motion for renew including evidence that of mit or exclude full summary [CR] this issue... it is un- Although expert witnesses.6 that. And that means disclosures with during common to have blood drawn give I’m going you of course have examination, persons most would continuance, going I’m but means *5 the knowledge require- lack technical it dismiss this case I continue before Simply process. of the because ments again. is not uncommon or having blood drawn court, Noble, Judge aptly trial artic- activity such is unlicensed because that the whether the question ulated was jury that unregulated does mean unregulated medical field unlicensed the necessarily specifics would understand phlebotomy required expert testimony activity upon of care of the or the standard Notably the to establish standard of care. including phlebotom- personnel, specific guidance there little this on jurisdictions ists, who draw blood. Other However, Kentucky. issue in we have testimony the expert to aid trier utilize general rule is that ex- “[t]he stated that of care in determining fact standard testimony malpractice pert required in a by an improper of harm caused cases case failed to to show that defendant of care is draw.7 As the standard blood ...”3 required conform to the standard scope experience of common not within the expert testimony as jurors, requiring Kentucky
In Rules Evi dence, phlebotomist of care of a expert KRE 702 that testi- the standard states 775, testimony by ap expert (Ky. draw without Harting, S.W.2d 778 blood 3. Jarboe v. 397 loquitur 1965) plying ipsa of res instead doctrine testimony eliciting expert the stan error); Adm’r, Mengel Ky. of carе to be reversible 306 dard 4. Greer’s Adm’r v. Harrell’s Ventures, 943, 209, 213, (1947). Ill.App.3d 323 Ingalls v. Health 206 946 son 91, 38, 69, 751 N.E.2d 256 Ill.Dec. See, Jarboe, 778; plaintiff present e.g., Wig- (noting that that it is essential 5. 397 S.W.2d at (3d ed.1940). person more, Evidence, establishing con testimony that expert § 1917 negligent ducting draw was blood States, Arbogast v. injury); negligence U.S. Hamling v. caused United 2887, 2903, (1974); Valley Corp., 214 W.Va. Med. S.Ct. 41 L.Ed.2d Mid-Ohio Commonwealth, (2003) (holding ex 502-03 589 S.E.2d Keene v. negligent draw (Ky.1974). necessary case of blood pert jury causing because a cannot a hematoma 240, 243, negligently Rosenow, defendant acted consider whether Pipers 39 A.D.2d against (holding which defendant’s (N.Y.App.Div.1972) until standard N.Y.S.2d measured). malpractice conduct to be permitting jury to find from proper negligence exercise of court decisions in trial discretion.8 the medical context expert in which witnesses were not re- further contends quired juror lay on the view summary judgment that was entitled to competent analyze the conduct and ren- because at the motion time the was heard der an appropriate verdict without the as- court, by the trial Ms. Miller was without of an witness.9 expert phlebo- sistance As expert an the phlebotomy establish tomy practice is an field of unlicensed standard of do Rarely care. we encounter providers as numerous other medical rou- summary claims of entitlement judg services, tinely perform phlebotomy from ment one who lost at trial. Normally, evidence is was unreasonable for claim is presented trial court error Ms. that no expert Miller to wit- contend failing grant verdict at directed necessary ness was Nevertheless, of the to determine that her close evidence. Cen injuries Baptist predicates tral argument leaving on were caused the tourni- its language of CR summary judg quet patient’s 56.03 that her long arm too or that the “shall ment be rendered forthwith if the principle loquitur applied оf res ipsa pleadings, depositions, answers to inter However, case. judge, acting the trial well stipulations, rogatories, and admissions on discretion, within her saw it otherwise. file, together affidavits, if any, the trial foregoing, prop- view court show there is genuine issue toas erly exercised its discretion to announce any material fact moving and that the par ruling necessity expert an wit- ty is entitled to a a matter of grant ness and to Miller a Ms. reasonable Upon basis, law.” it insists that the time which to *6 procure expert. Un- trial court obligated grant was summary to circumstances, only der these not did the judgment when the state the record on failing grant trial court not err in to sum- the date of the hearing revealed that Ms. mary judgment, to have done so would Miller could not prove her case. extraordinary. have been outset,
At
we observe that
inappropriate
to use a CR 56
while the trial
It
ruling
court’s
with regard to
summary judgment
to resolve what is es
necessity
of an expert witness was
sentially
procedural dispute
to
discretion,
within the
as
court’s sound
see su
pra,
need for an
expert,
issue was not so
disclosure of the
clear-cut that
persons
expert’s
reasonable
not
identity,
could
have dif
and the substance of fered. This Court
testimony.10
disputes,
has rendered numerous
In
it
such
is within
Keene,
Jarboe,
matters.”);
loquitur
complex
tions
failure
rather than
for
to
expenses.
Bap-
Miller’s medical
Central
summary
as
grant
judgment
procedur-
recovery
limit
to
tist seeks to
Ms. Miller’s
al
in rare cases.11 In
except
sanction
actually
amount
the amount
Housman,
Appeals
the Court of
Ward
It
actually
a matter of law.
collectable as
it
to
sum-
improper
grant
held that was
asserts that this is not a collateral source
mary
tool where
sanctioning
issue;
that the amount of
rather
claims
comply
counsel failed to
with the
plaintiffs’
is no
alleged damages for which there
discovery
by not disclos-
court’s
schedule
to be
obligation
pay
to
is not a valid item
timely
indispensable
an
ing in a
manner
jury and
submitted to the
awarded
Housman,
expert
the trial
witness.12
damages.
jury
awarded Ms. Miller
any expert
an
excluding
court issued
order
$34,000
to
expenses
reduced
testimony
not known after a
of witnesses
$22,100
percent fault
apportion-
a 35
date, however,
certain
date. After
$40,922.08
sought
in medi-
ment.
had
She
to allow
plaintiff moved for reconsideration
$31,840
expenses. The
was
cal
sum
they
their
to
would
expert
testify because
doctor,
only
to maintain
cause of
be allowed
their
he received
billed
but
beyond
stage
action
verdict
directed
$3,356.38
from Mediсare. Central
Likewise,
litigation.13
in M.P.S. v.
only responsi-
claims that Ms. Miller was
Res.,
Cabinet
Human
the Court
(the
$3,356.38
actu-
amount
paying
ble
Appeals
that it was not an abuse of
held
Medicare),
remaining
and the
ally paid by
expert
testify
permit
discretion to
$28,483.80
as a Medicare
was classified
expert
oppos-
where disclosure of
adjustment
write off. Central
or Medicare
ing
disputed.14
counsel
adjust-
the Medicare
Baptist claims
mandatory
It
for the trial court
ment
Ms. Miller’s windfall.
contrary
grant
judgment,
summary
Miller
Baptist’s
contention. Ms.
plain
to reduce a
improper
It is
prepared
testify
had witnesses
for medical
damages by payments
tiffs
blood,
of care of
who draw
people
standard
*7
policy
insurance
under a health
treatment
phlebo-
did
have a named
although she
not
plaintiff
the
premiums
paid
if the
were
tomy
Baptist’s argument
expert. Central
the tortfeasor.15
party
or a
other than
third
unpersuаsive
summary judgment
is
as the
rule, as this rule is
source
The collateral
testimony
expert
that
hearing established
(1)
known,
to
the
commonly
allows
on
of care would
phlebotomy
the
standard
of
for
value
recovery
seek
the reasonable
necessary.
no
discre-
be
There was
abuse
injury, and
seek
for an
medical services
of
tion or error
law.
recovery
value of medi
the reasonable
for
II.
of insur
cal
consideration
services without
injured part
the
payments
ance
made to
argument
second
Baptist’s
long
rule has
source
granted
y.16
have
The collateral
is that the trial court should
Hedgespeth, 892 S.W.2d
O'Bryan v.
Nat'l Bank & Trust
15.
11.
Greathouse v. Am.
Cf.
allowing
Co.,
evi-
(Ky.1995) (holding statute
(Ky.App.1990).
between the nature of the so (Citations omitted). (Ky.App.2005). they did come from the defendant or person acting way stating for him. One say conclusion is the tortfea- 22. Id. unfair, unreasonable, trary,
below usual fees does relieve a tortfea- or unsupport- duty from negligence pay sor or the ed by legal principles.”25 sound trial The reasonable value of Ms. Miller’s medical in position court was the best to determine Therefore, expenses. we hold that evi- scope Apple- whether limit the of Ms. dence of collatеral or con- payments source gate’s testimony discovering and no appar- tractual properly allowances was withheld discretion, ent abuse of we defer to the jury from the her and award medical judgment. trial court’s expenses proper. Accordingly, we affirm. III. GRAVES, JOHNSTONE, ROACH, Baptist’s argu Central final SCOTT, WINTERSHEIMER, JJ„ and
ment is that trial improperly court concur. expert’s testimony limited regarding its J., report COOPER, the lab but did not so limit separate opinion Ms. files a expert Miller’s dissenting the same issue. Central part. in Baptist claims that Denise Dunn’s testimo COOPER, Justice, dissenting part. ny may that Ms. Miller’s blood have be age, Appellee of her Because Golda Mil- hemolyzed expert opinion come ler trial beneficiary. is Medicare unqualified Notably, she was to make. malpractice against her medical lawsuit report question lab was introduced Appellant, Baptist Systems, Healthcare Baptist’s expert Cynthia Apple- Central (“Cen- Inc., Hospital Baptist Central d/b/a gate. trial The court limited her testimo tral Baptist”), Miller introduced as evi- on the ny topic to a statement that the lab dence and in the med- recovered report irregularities did not show be ical R. expenses “charged” Dr. Charles Applegate cause Ms. was not identified as $81,840.00 and Combs the total sum expert qualified interpret the lab P.S.C., total Neurodiagnostics, The report.23 report lab was stipulated $1,700.00. However, sum of because of being into evidence as of Ms. one Miller’s “participating providers” their status as Ap- and medical records. Ms. Dunn Ms. services, and Dr. Combs Neuro- plegate permitted were both read from diagnostics accepted from Centers interpret the record but not its results. (“CMS”) Medicare and Medicaid Services Likewise, Baptist counsel for both Central their payment-in-full services permitted and Ms. Miller were to read $3,356.38 $791.07, respective- sums of and reports during from the their closing lab ly. opinion majority characterizes arguments. unimpeachable There was no charged the amounts difference between testimony con expert Baptist as Central as “collateral the amounts source testimony because was limited to tends benefits,” allowing Miller to Moreover, prove thus reading reports. from the lab “charged” pre- amount collect the questions concerning scope of evidence proving from cluding are left to the discretion of the trial court *9 the to ac- limiting to the amount to determine whether admit and exclude cepted payment-in-full. An as That character- evidence.24 abuse discretion occurs judge’s ignores a “trial arbi- the of modern when decision ization realities [is] Goodyear Thompson, CR 25. Co. v. 23. 26.02. Tire Rubber 575, (Ky.2000). 581 Commonwealth, 24. 516 Keene 855.
685 care, i.e., care,” 1965, Congress health the “managed enacted Medicare Act,1 1395, 42 § to relationship now codified at U.S.C. providers between medical provide aged, health care for the and the payers, and medical especially when Act,2 Medicaid now codified at 42 U.S.C. is, here, payer government. 1396, § provide to care for the indi- health 1995, gent. By than of all more 40% I. MEDICARE. expenditures health care were Depression, Prior to the physi- Great programs, these to through opposed fees, negotiated usually cians their own by by private 32% insurance and 21% indi- a sum accepting pa- (cit- based more on Beard, patients. supra, vidual at 464 ability tient’s to fac- pay than other ing Financing for Health Care Sources Beard, Services, tor. Michael K The Impact Financing Health Care Review 14). Changes Health Care Provider Reim- As of Supplement Statistical 2001, Systems for Recovery expenditures hospital bursement 58% care (30% by Damages Expenses public payers by were Medi- Medical in Per- for care, Medicaid, others), Suits, by by 17% Injury sonal Am. 11% J. Trial Ad- insurance, 1998). private by 34% and 3% indi- voc. (Spring As the coun- CMS, patients. vidual Health Care Indus- try deeper depression, sank into try Update, Hospitals Acute Market Care (AHA) Hospital American Association 2003). (July sponsored the establishment of “Blue Cross,” tax-exempt, pre-payment plan implementation From until care, hospital for designed which was Fee in January Medical Schedule provide hospitals with a stable source of physicians Medicare reimbursed for their from revenues lower and middle-income fees,” “reasonable defined as the lowest patients. Sylvia (1) A. & Barry Law En- physician’s charge billed for the sminger, (2) Negotiating Physician’s service, Fees: physician’s customary (A Society? Individual Patients or Case charge, prevailing charge Federalism), Study Beard, community. N.Y.U. L.Rev. that service in the (1986). By supra, (citing Physician similar at 464-65 n. 68 plans, Commission, Shield,” Payment dubbed “Blue Review Annual were created 484). Report system, pro- physician’s fund Under this Id. at services. 9-10. viders controlled own increas- Payment their fees directly was made to the physi- ing charges annually higher their assure cian when the service was rendered. Id. year. reimbursements the next Id. at 468. success Blue Cross Blue encouraged Shield private insurers be- spiraling To control the of govern- costs gin Beard, health writing insurance. su- care, ment-paid imple- health pra, at 462-63. The payment pro- a “prospective payment system,” mented “usual, vider was percentage CMS, formerly which as the known (UCR) customary, reasonable” fee Administration, Financing Health Care es- charged particular service. Provid- payment on di- tablishes schedules based participating (“DRGs”) ers in Blue agnostic-related groups for hos- Cross/Blue accepted Shield rate full pitals UCR аnd a value resource-based relative (“RBRVS”) payment. Id. at physicians. scale These Act, Aged 1. Health Insurance for Pro- Pub.L. Grants States for Medical Assistance Act, 89-97, 89-97, (1965). grams Pub.L. No. 79 Stat. No. 79 Stat. 290 (1965). *10 amount, cost actual exceeds the DRG schedules are based on pre-set payment provider rather than the absorbs or writes off the cost of the services secondary billed, payer Under the stat- customary, prevailing charges. or loss. utes, the are inform costs limited costs Id. The and RBRVS DRGs customary. and in advance what are reasonable participating providers they will be for treatment rendered Sys., v. Via Health Rose Christi Inc./St. injuries or particular types illnesses (Kan. Campus, Francis P.3d particular types and of medical treat- 2005). patients. to Medicare Su- provided ments Furthermore, qualify par order to as Channick, Ongoing san Debate Adler thus, (and, providers be entitled ticipating Understanding Medicare: the Philo- Over CMS, from as as payment to direct well Divides, sophical Policy and 36 J. Health benefits), Neurodiag- Dr. and other Combs 2003). (Winter L. “[Medicare] 69-70 as agreed charge, except “not to nostics price take the offered or suppliers either provided in and paragraph [deductibles it. they impor- leave the historical Given coinsurance3], or any individual other provid- tance of Medicare revenue to most person for or services for which such items ers, it has rare for them to elect to been payment is entitled to have individual ” ” Id. 69. Since the ‘leave it.’ at DRG subchapter .... under made negotiable, it tech- rates are not RBRVS 1395cc(a)(l)(A)(i). Thus, § the ac U.S.C. to refer to the difference nically incorrect Neurodiagnos- Dr. ceptance Combs rates amounts between those by the authorized payments tics “write-offs.” “charged” “discounts” or RBRVS extin DRG applicable and/or fact, provider’s “charge” In ser- potential liability of guished any additional when, here, irrelevant
vices rendered is Baptist to those either Miller or Central primary as the payment Medicare makes Hosp., Pub. providers. Holle v. Moline payer opposed pay- to a “conditional (C.D.III.1984). F.Supp. secondary under 42 payer ment” as Lady Mer reasoning Under Our “Charges” § are 1395y(b)(2)(B). U.S.C. McIntosh, 461 S.W.2d cy Hospital v. secondary only payer relevant under the has a collat (Ky.1970), Central where, e.g., policy of medical or statutes to Miller for liability eral-source-based liability primary payer insurance is the Dr. actually paid to Combs CMS sums are limited those that are and costs Miller’s treat Neurodiagnostics for customary. See U.S.C. reasonable and ment; pay those is required and Miller summary: § 1395f. 42 U.S.C. sums over to CMS. Hartley, is structured program Rybicki § The Medicare 1395y(b)(2)(B)(ii); Cir.1986). (1st payment system un- prospective “[T]he 792 F.2d upon one where providers which health care scheme is not der Medicare recovery. for double beneficiary from accept primary payment contracts agree right notably, has a of sub- flat fee Medicare are reimbursed Most recovery allowing it seek by average rogation cost and basis determined Rose, 113 beneficiary.” paid to a diagnostic re- amounts length stay for various (DRGs). Baptist does Central provider’s If a P.3d groups lated actually amount, liability for the sums contest its cost below the DRG actual falls However, nor difference; neither Miller provider’s paid. if the keeps source,” relevant to actually so are not "collateral Any copayments deductibles appeal. issues on paid by payments from Miller would be
687 others, liability (Ky.1901), has further an potential opinion S.W. officially to Dr. Combs or of “Not to Neurodiagnostics, designated report both be ed,” predecessor have in court whom been full. Evanston our stated without Hauck, (7th authority that: Hosp. v. citation F.3d Cir.
1993); Rybicki, 792 F.2d plead a attempted The answer also
defense that
had an
plaintiff
accident
him
a
policy entitling
week from
$30
II. COLLATERAL SOURCE RULE.
companies,
of
each
two
that
originated
The collateral
source rule
plaintiff, by reason of
said contracts
his
English common law and
in this
debuted
with
insurance companies,
pre-
said
had
country in
Propeller
The
v.
Monticello
against
sented
claim insurance
(17
Mollison,
How.) 152,
58 U.S.
15 L.Ed.
him,
damages
sustained
and that he
(1854). “Monticello,”
steamship,
same,
attempting
was
to collect the
all of
“Northwestern,”
schooner,
collided on
out,
which was stricken
so.
properly
Huron, causing
Lake
“Northwestern” to
added). Later,
(emphasis
Id. at 834
cargo
Mollison,
sink with its
of salt.
held, again
Court also
without citation to
insured,
of “Northwestern,”
owner
authority,
question
plaintiffs
“[t]he
compensated
and his insurer
him in full for
his
employment
policies
or
accident
could
his loss. When Mollison sued the steam-
proven
purpose
defeating
not be
for the
ship, its owner raised as a
defense
right
or diminishing
recovery.”
his
Id.
already
fully
Mollison had
compen-
been
Supreme
sated. The United States
Court
Jennison,
Taylor
In
v.
rogation injured person may the source recover fense to collateral those hospital expenses providing incurred on having contributed behalf, expenses his at the are least where by excise taxes payment benefits of be- paid pursuant agreement upon to an based employer. cause of its status as an See payment the of or premiums contributions Southerland, v. Hardaway Mgmt. Co. by injured person.” or behalf of the Id. (“The (Ky.1998) log- 977 S.W.2d added). (emphasis at 907 is ic collateral rule [the source] behind why Mercy wrongdoer In Our v. is Lady Hospital that there no reason McIntosh, the insurance Court held there could should receive the benefit portions plain- no for injured party be offset those for his by obtained the tiffs hospital course, and medical bills that were logic Of protection.... own Medicare, actually paid perceiving here, wrong- where the apply does not plaintiff paid premium had for those doer, also obtained insur- Hardaway, benefits. 461 at S.W.2d compensa- paid workers’ ance which Southerland.”).] the patient [McIntosh assumed had tion benefits paid something for the Medicare cover- Daugherty, 609 v. S.W.2d Daugherty In fact, care, age. hospital Id. at 379. In we held that medical (Ky.1980), A,” “Medicare Part which was the medi- treatment for bills incurred McIntosh, expense cal at issue in provable hospital were both military at a security available to social and railroad though payable collectable, even recipients payment retirement without aas her her father’s status because of 406.6(a); § premiums. 42 C.F.R. 70C military servicemember. Security Am.Jur.2d Social and Medi- to those care, similar case at bar is § premiums 2046. While are funds. B,” and welfarе charged involving Part which “Medicare bills, not re- B is father was physician’s Although includes Part also movant’s partially by funded income and in order quired pay premiums federal every employed excise taxes a mili- imposed on at qualify for medical treatment (through individual withholding) FICA coverage nonethe- tary hospital, every employer in the United military his ser- less a direct benefit States, including, presumably, Central vice. 1401(b), 3101(b), §
Baptist. U.S.C. words, plaintiffs at Id. other 3111(b) Thus, arguable it is that there by serving “paid” father the treatment liability should be collateral-source at Rayfield v. Law military. in the See also respect payments. all with to Medicare Cir.1958). (4th rence, 253 F.2d 213-14 Mitchell, Enterprises, Burke Inc. v. an em reasoning applies The same when (“There (Ky.1985) wages are lost ployee’s medical bills or sharp distinction collateral between carrier by the insurance paid employer’s payments by anoth- source benefits emplоyment. fringe benefit of charged liability person er also 796; Enterprises, Burke subject injury which is matter Risen, Ky. Baking Co. v. Hellmueller (Second) lawsuit.”); Restatement (1943). 134, 136 273, 174 S.W.2d 920A(1). § If of Torts Miller Law rightly hold that All of these cases can entitlement to the collateral assert entitled the benefit having tortfeasor source rule on the basis in- injured bargain party’s B when premiums for Medicare Part cover- in cash either jured party purchased, can assert a de- has age, Central (Second) services, § cmt. payment or in of medical bills of Torts Restatement (1979). owing. Housing h actually incurred and either See also Hanif *13 Auth., 635, Cal.App.3d Cal.Rptr. That of the 200 246 is nature “collateral source (1988) (“ rule,” by 192, an is as defined these cases. It 195-96 ‘Reasonable value’ is limitation, aggrandize of of exception “strong in term not public policy ... plaintiff ment. is entitled to recover against [A] this Commonwealth double recov- to, than, actual up and no more ery.” Hardaway, 977 at S.W.2d Otherwise, expended past or incurred for object amount compensatory “[t]he of long medical so as that amount is injured services damages is to make party Frohman, reasonable.”); 901 Goble v. possible whole to the that is to extent it (Fla.2005) 830, (“[Recovery for So.2d 835 injury money. measure his of terms expenses to amount [is limited] medical object place plaintiff The is not to in a actually of medical that he expenses position better than he would have been obligated pay.”). to wrong had Ky. not been done.” Cent. Schneider, 373,
Ins. v.Co. 15 374 S.W.3d opinions jurisdic- The better-reasoned (internal omitted). (Ky.2000) citations that this hold tions have addressed issue “The purpose compensatory tort dam- collateral source rule does not to ages compensate; is it not pur phantom to kind of apply expense this pose damages punish of such to defendants never incurred. upon or bestow a plaintiffs.” windfall Pe If Plaintiff these with- could recover fees Co., terson v. Lou Bachrodt Chevrolet 76 showing personal liability, out a she 353, 444, 1, Ill.2d 29 Ill.Dec. 5 392 N.E.2d at reap recovery would windfall (1979). Nevertheless, majority opinion expense taxpayers, who made her judice the case sub allows Miller possible. collat- Medicaid benefits The prove and collect expenses medical rule apply eral source does not because her,
were never incurred by were never Plaintiff did not incur the Medicaid dis- by owed or any entity, Medicare other count. payment for which expected was never Wallace, F.Supp. McAmis v. 980 185 providers. medical majority pur (Like (W.D.Va.1997). providers, Medicare ports justify this by substituting result providers required accept Medicaid are “expenses “reasonable value” for incurred” payment payment the Medicaid in full. Ante, as the measure dаmages. at 682. Thus, § addressing cases C.F.R. 447.15. However, when a sum certain has been the issue in the context of Medicaid paid services, for the “reasonable value” “charges” payments versus actual are paid. cannot exceed the amount issue.) equally relevant See also plaintiff Cal.Rptr. plain When the seeks to recover for Hanif, (limiting at 197 expenditures liability recovery made or incurred tiffs collateral-source medical rendered, $19,317, persons to third for expenses actually paid services amount normally Medi-Cal, the amount recovered is the value” of “reasonable Johnson, $31,618); Leasing, reasonable value the services rather Inc. v. Coop. (limit If, charged. than (Fla.Ct.App.2004) the amount So.2d however, $13,461 injured recovery person ing less collateral-source Medicare, rate, $56,950.70 exchange paid by than the can he recover billed paid, exceрt no than providers: more the amount medical reasonable value “[T]he rate gift when the low was intended as a of medical services limited to the to him. accepted payment amount full (and services.”); which McKinley, insurance Dyet medical 139 motorist automobile “not final and shall currently designated Idaho 81 P.3d (“[T]he ... is not authority [Medicare] 'write-off courts not be cited as damages may ante, item of plaintiff Kentucky”), which Commonwealth recover because has incurred Hos- ignores Thomas v. Greenview therefore.”); Rose, liability P.3d at 248 Inc., (Ky.App.2004), pital, (amount of write-off must be source rule which addressed the collateral against ex- credited award of, coincidentally, Medicare in the context *14 penses, particularly the Medicare where proper- acted write-offs. trial court “[T]he provider malpractice also defen- the full introduce the ly allowing in Thomas to dаnt); Kan.App.2d Hogg, Bates v. expenses billed and amount of the medical (1996) (“[T]he P.2d collateral the amount to reducing judgment then the rule not under these applicable source is tri- following to the payable providers the provider, circumstances. [A] evidence, the allowing Id. at In al.” by contract, may agreement and not Beckner v. relied on Appeals the Court of charge patients Medicaid for the difference Palmore, (Ky.App.1986), customary charge and [sic] between their procedure which mandated the same Therefore, by the paid amount Medicaid. paid previously respect to medical bills the amount Medicaid becomes allowed benefits reparation the form of basic ‘customary the amount due and the (BRBs). course, represented BRBs the Of the circumstances we have charge’ under paid, and expenses incurred actual medical us.”); befоre Kastick v. U Haul Co. W. of such as Medicare phantom expenses not Mich., 797, 740 292 A.D.2d N.Y.S.2d to respect Medicare write-offs. With (2002) (“[Medicare] ... write-off is not both the I would limit payments, Medicaid plaintiff damages an item of for which the amount to the the evidence and has incurred may plaintiff recover because actually paid. incurred and therefor.”); v. liability Moorhead Croz- concluded: so aptly As Professor Beard Ctr., Pa. 765 A.2d er Chester Med. pro- system should legal A functional (limiting plaintiffs re- 789-90 to $12,167.40, certain, fair, rules and rational covery to of vide payment $108,668.31: More- its citizens. govern the affairs of “reasonable value” here, “[W]here, over, the waste given exact amount of the over the concerns ex- system, contract expenses inefficiency legal has been established our satisfied, to the have to conform expenses pecting legal and those been rules as to the reason- longer any is no issue seems there current realities economic plaintiff Oftentimes, which the expenses amount of the courts are able. case, in- latter the in- will be liable. all these fully accommodate able recovering jured be limited to party should Howev- deciding legal issues. terests medical services er, amount of recov- the measure limiting rule (where source .... find the collateral provider [W]e ery charges additional inapplicable rule billing prohibited from balance $96,500.91.”). amount criteria. of these patient) meets all certainty without provides rule Such although the ma- passing I note protected by the violating principles Hasty, v. quotes Schwartz jority cites and limit with a rule. Even 2003-CA-000796-MR, collateral source opinion there is no net loss recovery addressing collateral Appeals Court tort force of lessening of deterrent rule the context of underinsured source law, defendant gain does not Kentucky, plaintiffs bargain,
benefit COMMONWEALTH Appellant, plaintiff compensation receives full the amount of the expense he was obli- v. gated pay. Certainly, the collateral NOURSE, Appellee, Othaniel Cantrell source rule should not extend so far as permit recovery for sums neither the nor collateral will source Nourse, Appellant, Othaniel Cantrell obligated ever be pay. Moreover, the paid charge rule com- Kentucky, Appellee. Commonwealth of ports with the our economic realities of 2003-SC-0220-MR, Nos. time it adopts because the same assess- 2003-SC-0221-MR. ment of value determined the mar- Supreme *15 ketplace. Kentucky. Court participants the health industry care all recognize the impact 22, 2005. Sept. competition market the pricing Rehearing Denied Dec. health care. This realization on pro- vider’s is epitomized by side the follow-
ing well-respected comment in a publication:
economics “If your stated procedure $5,000,
fee for a but paying $2,500,
insurer than more what you
will charge an pa- out-of-network
tient or someone savings with medical ... If you’re
account? willing to take
$2,500,then your that’s fee.”
Beard,
(quoting Mark Econ.,
Med. September 1997, at
146). I
Accordingly, dissent and would reverse case for new trial at which only the expenses
actual medical in- paid would be
troduced into evidence and awarded in the
judgment.