*1 surviving spouse E. Lagerstrom, Klover as of, Special and as Administrator Lagerstrom, Estate of Vance H. Plaintiff-Appellant,
v. Myrtle Hospital-Mayo Health Werth System, Company,
ABC insurer, Insurance its Clinic-Mayo System, Red Cedar Health Company, and DEF Insurance its insurer, Defendants-Respondents.
Supreme Court 14, argument No. 2003AP2027. Oral December July Decided
For the there was Axley Brynelson, Guy LLP, Madison, and DuBeau and argument by Guy oral DuBeau. Leitch, J.
An curiae brief was filed Laura amicus Hospital Madison, the Wisconsin Associa- on behalf of Adams, Madison, on Inc; and Mark L. behalf tion, Society. Medical Wisconsin by Lynn R.
An amicus curiae brief was filed Laufen- berg Laufenberg S.C., Milwaukee; Bruce Hoefle, & Hanaway, Bachhuber, Weidner, R. Bachhuber and Bay; Maloney, S.C., William C. & Green Woodward Gleisner, III, Gleisner, III, C. and Law William Offices Academy of behalf of the Wisconsin Milwaukee, on Lawyers. Trial ABRAHAMSON, C.J. This SHIRLEY S. appeal judgment order of the Circuit from
an
Judge.
County,
Jr.,
Stewart,
William C.
for Dunn
Court
malpractice
wrongful
case comes
death medical
This
from
on certification1
the court
this court
before
(2001-02).2
pursuant
appeals
Stat. 809.61
to Wis.
Following jury's
verdict, the circuit court
plus
judgment
$55,755
costs
in the amount of
entered
surviving
individually
Lagerstrom,
as
in favor of Klover
(Wis.
2001-02 version unless spouse Lagerstrom Special of Vance H. and as Admin- Lagerstrom, deceased, istrator of Estate of Vance H. collectively against Myrtle referred as the estate, Hospital-Mayo System, Werth Health ABC Insurance Company, Clinic-Mayo System, insurer, its Cedar Red Company, and DEF insurer, Insurance its referred collectively as the defendants. The circuit court's order post-verdict denied a motion under Wis. Stat. 805.14(5)(c)3 change special on the answers appealed. verdict; estate primary presented
¶ 3. The issue is whether the circuit court erred under Wis. Stat.
admitting evidence of collateral source in this refusing action, in to admit evi- *7 potential obligation dence of the estate's to reimburse instructing jury may, Medicare, and in the that it but payments not, need consider the collateral source in determining the reasonable value of the medical ser- vices A rendered. second issue is whether the circuit awarding in court erred $7,610.10 the estate for expenses. funeral 893.55(7) §
¶ 4. Wisconsin Stat. reads: any of bodily Evidence compensation injury for re- ceived from than sources other the defendant to com- pensate the injury claimant the for is admissible in an action to recover malpractice. medical This section does not limit the or procedural substantive rights persons of upon who have claims based subroga- tion. 805.14(5)(c) provides: "Motion change to Wisconsin Stat.
answer. Any party may change move the court an in answer the on ground verdict the insufficiency the evidence to sustain the answer." the text of ex- conclude that We payments
plicitly evidence of collateral source allows malpractice actions but fails to be introduced medical purpose admitted. for which the evidence is state the that if evidence of collateral source further conclude We including payments Medicare, other state from sources programs, government medical insurance or or federal free medical services is write-offs, and discounted or parties presented must fact-finder, the then the he any jury obliga- evidence of allowed to furnish the with subrogation or reimbursement. Because tions statutory a fact-finder to do not inform what text does interpreting evidence, statute with determining do with the evi- what a fact-finder must legislative statute, the we consider the text of the dence goal, history, legislative and three common-law encompassed concepts in medical actions 893.55(7), namely the reasonable value and Wis. Stat. rule, and services, the collateral source of medical subrogation. circuit court that the must We conclude not reduce the it must the fact-finder instruct on the value of medical services basis reasonable jury Although payments. is in- collateral source collateral source the evidence of structed not use payments services, for medical to reduce award may be used of collateral source evidence value of the reasonable to determine services. *8 regardless of the further conclude that We 893.55(7) § adopted,
interpretation be- of Stat. Wis. jury present of case was advised the the the cause net amount the and the collateral source paid services, advised of but was not for medical estate obligation potential to reimburse Medicare the estate's jury assess the services, the was not able to for fairly. fully reasonable value medical services refusing argument error in This to admit evidence of or obligation potential the about estate's to reimburse Medicare is reversible error. Accordingly, interpretation
¶ 7. under our of Wis. § 893.55(7), any interpretation and indeed under 893.55(7), judgment we must reverse the and order of the circuit court and remand the cause to circuit hospital for a trial court expenses. new on the issue of and medical expenses, ¶ 8. On issue of funeral the defen- argue according 895.04(5),4 dants to Wis. Stat. expenses permissive, the award of funeral not man- datory, and therefore fact-finder has discretion expenses. whether to award these In the instant case jury money no awarded sum to reimburse the expenses though for estate funeral and burial even negligence found defendants' awas cause though of the decedent's death even no evidence $7,610.10 controverted the sum of as a reasonable expense. We hold that under these circumstances the granting circuit court erred the estate's motion change special relating verdict answer to funeral expenses undisputed and burial to reflect the amount of expenses. $7,610.10 for these remand, On we therefore instruct the circuit $7,610.10 court enter on the Wisconsin Stat. reads: personal representative brings If the wrongful [for the action death], personal representative may also recover the reason- expenses, expenses, including able cost of medical funeral lot, cemetery grave
reasonable cost of a marker and care lot. brings death], wrongful [for If a relative the action the relative may expenses, expenses, including recover such medical funeral cemetery lot, grave the reasonable cost marker and care of the lot, person on any paid behalf of himself or herself or of who has liability expenses. assumed such *9 fairly required special form as the amount verdict compensate reasonably funeral and the estate for and expenses. burial
I appeal purposes are of this the facts 9. For they undisputed. conceded that were The defendants negligent care and treatment of the decedent in their feeding by inserting tube a and committed lung passageway rather than of the decedent's into the inserting stomach and fluids. into the negli- their ¶ 10. The defendants asserted They gence injury a cause of death. was not caused but history, age argued and medical the decedent's associated with the severe trauma combined with ensuing surgery, breaking hip the caused his and the placement negligent after some two months death feeding found that the defendants' tube. The of the negligence The death. of the decedent's was cause appeal. in this is not before the court of causation issue jury award of court issues involve The before expenses. funeral for medical services Lagerstrom, decedent, H. was 11. Vance hip years his on November old he fell and broke when Hospital, Myrtle Werth 24, 2000. He was admitted following surgery, days hip replacement and within two family congestion in the noted some doctor x-ray lungs no a fever. A chest showed decedent's lungs. damage to the acute duty doctor decided December On feeding the decedent was tube to ensure that
insert feeding getting proper tube was nutrients. passageway reaching misplaced, into lung In the his stomach. rather than into decedent's afternoon December ounces a nutrient-laden *10 pumped through feeding drink, Ensure, was tube directly lung. into the decedent's left
¶ 13. The was decedent transferred the critical Hospital, unit, care then to Luther and then to Lake- Nursing side Home. The decedent remained on a ven- Day, tilator and on 2000, Christmas was re-admitted to Hospital despite fever, Luther with a treatments with his controlled, antibiotics. After fever was the decedent Nursing was Home, returned to Lakeside where he January 29, remained from 14, December 2000 until 2001, when the fever recurred and he was returned to Hospital. Luther By February 14, the decedent had off been following day week, ventilator a but he was emergency joint Joseph's
taken room of St. with pain. Nursing The decedent then returned to Lakeside By February prob- having Home. 22, the decedent was including February lems, hallucinations. He died on 2001. The death certificate listed the cause death as pneumonia. wrongful
¶ 15. The decedent's wife initiated a death medical action under ch. as the surviving spouse special and as the administrator decedent's estate.
¶ 16. Counsel the estate communicated with regard expenses Medicare in to various medical that paid. Medicare Communications from Medicare indi- rely statutory right cate that Medicare would on its joined reimbursement. Medicare was therefore not the action.
¶ 17. The estate introduced evidence about the reasonable value the medical services rendered to the approximately The decedent. amount $89,000. was objections, presented defendants, over the estate's evi- jury out-of-pocket argued to the dence and only charges $755, with the the estate were incurred expenses through remaining paid collateral medical provider Medicare, as write-offs sources, such private regulations, pursuant insur- to Medicare jury The circuit court instructed ance. out-of-pocket expense for medical services
estate's total was $755. jury the law does 18. The was instructed that require it to be the it to reduce the sum determines by the the medical services caused
reasonable value of negligence made to reflect defendants' instructed, how- other sources. The was further *11 may it reduce, decides, if so the amount ever, that it by of medical the reasonable value services awarded for payments. the amount of collateral source argu- The court limited the estate's circuit jury regarding obligation to ment to the the estate's argue The estate could reimburse Medicare. potential liability Rather, to Medicare.
the estate had argue could, if it forced to that the estate the estate was voluntarily repay wished, Medicare. gave jury special ver- 20. The circuit court the separate questions ele- on each
dict with instructions Jury damages as recommended the Civil ment of required and as Wis. Instruction Committee5 (1998). These instructions Wis JI —Civil 1750.1 Comment cases, cases, designed including for all medical are the The recommends involving personal injuries. Committee (2) (1) medical; future following past verdict format: subdivided (4) (3) of earning future loss medical; capacity; of past loss (6) (5) suffering, disability; and and earning capacity; past pain, suffering, disability. This format was used future and pain, the present case. 893.55(5).6 jury separate answered the verdict
questions damages, awarding on the $20,000 estate for pain suffering awarding the decedent's and and the surviving spouse society $35,000 for the loss of and jury companionship.7 The awarded the estate for $755 expenses ("ambulance, hospital, medical ing medical, nurs- expenses") home, rehabilitation, and bed hold and nothing expenses. for funeral appeal
¶ 21. The focus of the is the circuit court's payments of admission evidence of collateral source purpose determining the of reasonable value medical services, its refusal to admit evidence potential obligation estate's Medicare, to reimburse may its instruction to it consider the awarding damages collateral source for the expenses. Wisconsin Stat. reads as follows: (5) Every specify award of under ch. 655 shall sum money, any, following if awarded for each of the for each claimant n period injury for the from date of date of award and for period award, regard after the date of without the limit (4)(d): under sub. (a) Pain, suffering disability. and noneconomic effects of (b) consortium, society companionship Loss or loss of love and affection. (c) *12 earnings earning capacity. Loss of (d) expenses. of Each element medical (e) injuries damages. Other economic and 7 jurors Two on dissented the of question whether the negligent placement of feeding the tube of was cause the decedent's death and the question of what amount money of fairly reasonably would and compensate Lagerstrom Klover for society the loss of and companionship.
14 objection The central Wis. estate's 893.55(7) permitting of evidence collateral is that regarding providing guidance the in not and benefits legis- evidence, of the consideration this fact-finder's unlawfully delegated policy public and has lature juries case-by-case equitable on a considerations to challenges any guidelines. The estate basis without grounds, constitutionality on of several the right powers, including separation of of violation process by jury, equal protection due and trial interpre- proper guarantees.8 conclude that under a We 893.55(7), do issues of these constitutional tation arise. it is entitled to estate also asserts expenses. The estate's and burial
$7,610.10 position funeral negligence conceded, was the is that because negligence jury causation between established undisputed, expenses funeral were death, and the undisputed have entered that circuit court should allowing jury of verdict, instead amount on that the The defendant asserts determine award. funeral and a new trial on the not entitled to estate is doing merely expenses what was because burial making always is, a factual determination does, it 8 constitutionality of are divided about State courts declaring collateral source legislative enactments declaring such laws as evidence. For state courts admissible (Ala. Green, see, e.g., v. So. 223 Marsh constitutional, 782 2d (Cal. 1984). Wood, v. 2000); For state courts Barme 689 P.2d see, e.g., O'Bryan v. unconstitutional, declaring such laws (violation 1995) (Ky. of Hedgespeth, 892 S.W.2d 571, 576-78 Maurer, 825, v. A.2d 835-36 Carson powers); separation (violation (N.H. 1980) protection); State ex rel. Ohio equal Sheward, Lawyers v. N.E.2d Academy Trial (violation (Ohio 1999) process). due 1088-90 *13 money fairly of the amount of that would and reason- ably compensate the estate for funeral and burial expenses.
l—l 1—1 primary presented interpre- 24. The issue is the 893.55(7), question tation of Wis. Stat. of law that independently this court decides of the circuit court or appeals benefiting analyses. court but from their 893.55(7) provides malprac- Section that in a medical compensation bodily injury action, tice evidence of for received from sources other than the defendant is admissible in medical action to recover damages. The statute adds it does not limit the procedural rights persons substantive with subro- gation claims. The statute reads as follows: any
Evidence of compensation bodily injury for re- ceived from other than sources the defendant com- pensate injury claimant in an admissible action to recover malpractice. for medical This section does not limit the or procedural substantive rights of persons have upon subroga- who claims based tion. appears 25. This case to be the first time an
appellate court in this state has considered this statute. meaning 26. We determine the of Wis. Stat. (A) (B) light statute; the text of the (C) legislative history legislative goal statute; adopting concepts statute; and three of law (D) namely, embodied in the statute; the valuation of (E) (F) medical services; the collateral source rule; and subrogation. *14 § conclude that the text of 27. We payments
explicitly of collateral source evidence allows malpractice We in medical actions. be introduced if collateral evidence of source further conclude including payments Medicare, other state from sources government programs, or insurance medical or federal is medical services write-offs, and discounted or free parties presented be fact-finder, then the must to the any obliga- jury the of allowed to furnish with evidence subrogation the or reimbursement. Because tions of the not a fact-finder what to do with text does inform determining interpreting evidence, in the statute and con- do with evidence we what a fact-finder must the history, legislative the statute, text of the the sider the goal, concepts legislative and common-law encom- three malpractice passed actions and Wis. Stat. in medical 893.55(7), namely value of medical ser- reasonable subrogation. rule, We vices, collateral source and the fact- instruct the circuit court must conclude that the of reasonable value it must not reduce the finder that collateral source on the basis the medical services Although jury payments. instructed use is payments reduce the source of collateral evidence services, of collateral source evidence award for medical may payments to determine the be used of medical services. reasonable value
A Stat. the text of Wis. 28. We examine first 893.55(7). large long, yet only covers a is 50 words It malpractice damages cases. in medical area of the law expenses, Although medical instant case involves encompass appears in a all statute action and to make evidence of all regard collateral source admissible in to all damage claims. Although speaks compensa-
¶ 29. the statute claimant, tion to the the instant case demonstrates that encompasses payments, the forgiveness write-offs, statute also directly providers made to health care though rather Also, than to the claimant. even only phrase "bodilyinjury," statute uses unlike Wis. 893.55(4)(b) (e), "bodily both which use injury" enough "death," it broad to include wrongful death actions.
¶ 30. The statute does not limit the nature *15 payments collateral source and thus on its face seems to encompass payments such as those from federal and governments, state life insurance, income continuation plans, and volunteer services, of some which are ordi- narily by excluded similar in statutes other states.9 only
¶ 31. The limitation stated in Wis. Stat. is that it does not limit the substantive or procedural rights persons of who have claims based upon subrogation. legislature obviously attempted The subrogation. to make the statute conform to the rules of ¶ 32. The text of the statute not does address expenses, numerous issues relation to medical subject appeal. of foremost, this First and the text does purpose not state the for which the evidence of collat- payments eral source is admissible. The statute does 9 See, (introduction e.g., 18, § Delaware Code Ann. Tit. 6862 of of evidence collateral sources limited to public collateral compensation benefits; source of or statute applicable not to life private insurance or collateral sources of compensation benefits).
18 reduce the fact-finder or circuit court not that a require rendered to value of the medical services reasonable The collat- source payments. account for the collateral credit for payments rule denies a tortfeasor eral source by any person the plaintiff or benefits conferred upon than tortfeasor.10 other admissibility silent about the statute is to incurred
of about victim expenses evidence such as premi- collateral source acquire payments, The statute neither pro- or other expenditures.11 ums evidence. nor the admission such hibits allows Dobbs, Damages, Equity, Law Remedies: (2d Dan B. Dobbs 1993). abrogat Many states 8.6(3), at 493 ed. Restitution ing by require statute the fact-finder the collateral source rule of medical services or court reduce the reasonable value See, e.g., Reid v. payments. collateral the amount of source 1998) (under (Alaska Williams, terms 964 P.2d mandatory reduction of the statute, circuit court makes a provided collateral source award reflect Ctr., Med. government Rudolph v. Iowa Methodist program); (statute (Iowa 1980) mandatory requires reduc 293 N.W.2d550 payments); source account collateral tion award (statute 1978) (N.D. Olson, requires v. 270 N.W.2d Arneson mandatory to reflect nonrefundable reduction award premiums paid over benefits received less reimbursement prior malpractice). years five the medical statute that allows evidence example, For the Arizona *16 plaintiff to payments also allows the collateral source certain to collateral paid secure the expenses introduce evidence evidence plaintiff may also introduce payments. The source recovery against to right provider's the collateral source subrogation. The or under statute as plaintiff reimbursement to permitted expressly that "unless otherwise provides further shall statute, of collateral benefits... provider do no so any against plaintiff as reimbursement amount recover rights subrogated to be provider nor shall such such benefits (West 2003). § 12-565 Ariz. Rev. S'tat. Ann. plaintiff." explicitly ¶ 34. The statute states it does not rights subrogees says nothing limit the but about the rights of reimbursement. The statute is silent about may subrogation whether a victim introduce evidence of obligation victim's reimburse collateral prohibits source.12The neither nor statute allows the admission of such evidence. par-
¶ 35. The silent statute is about whether the may argue public policies ties to the fact-finder about the underlying preventing rule, the collateral source such as benefiting payments inuring from tortfeasors from deterring Similarly, the victim and tortfeasors. the stat- say public policies underlying ute does whether the subrogation, prevention recovery, such as the of double argued jury. prohibits can be to the The statute neither arguments. nor allows such In sum, the text of the questions statute raises more than it answers. though legislature clearly 36. Even did not supposed
articulate how fact-finders and courts are apply 893.55(7), though use and Wis. and even language express complete of the statute does not abrogation of the collateral source rule in medical mal- 893.55(7) practice interpret actions, we must Wis. Stat. give legislature's explicit language effect to the allow- ing pay- the admission of evidence of collateral source chapter ments in medical actions under
B legislative history ¶ 37. The of Wis. Stat. provides guidance interpreting some statute. example, For Indiana's statute that allows the admission
of proof payments of collateral source other than certain enumerated proof allows admission into evidence of money of the amount of plaintiff required to repay. See (West 1998). Ann., § Ind. Code 34-44-1-2 *17 early became Wis. An draft bill that requiring included sentence payments reduce an award of source collateral damages: ch. shall under "The award injured party by any compensation that the be reduced from other than the defendant received sources compensate injury." This him or her for the sentence appear in enacted statute. does not history legislative documents in the 39. Four light the deletion of the sentence files cast some requiring on source reduction of an award collateral protecting of the sentence and the addition rights. subrogation Employers First, a communication from Sheryl Representative Albers, Insurance to
Health Assembly Insurance, on Secu- Committee Chair of Policy, Legislative Corporate in the Council rities and explains Assembly the need to Bill 36 file for 1995 bill requested subrogation. protect The communication 893.55(7). Represen- of the last sentence addition communication to Gordon forwarded the tative Albers Attorney Leg- at the Anderson, Senior Staff Wisconsin Employ- explains The communication islative Council. subrogation request protect ers Health Insurance's follows: as 1913/3) (LRB BILL 36
ASSEMBLY counsel, and staff we with the author After discussions our again and with language consulted reviewed language pose attorneys. Although itself does not those source rule and problem since the collateral independently, subrogation rights function who have interpreta- about we to have concerns continue future "made whole" application on a creative tions based doctrine. *18 Therefore, appreciate your we would of consideration following options the for two modifications. reference,
1. Insert within the committee record a in which would be included the comment section of the statute, annotation to the following the reference: (section 7) "This section relates to collateral source rule. procedural It does not limit the substantive rights of persons who subroga- have claims based upon tion."
2. The alternative would be to amend bill.. . through following addition language: of "This section does not limit the or proce- substantive rights persons dural who upon have claims based of subrogation." It is critical that option reference contained in one appear within the annotated statutes. If there ais possibility that reference would appear com- section, ments necessary we it is believe to include the statutory language outlined in option two.13 It is far from clear what this memorandum means by "creative of application" the made whole doctrine.14 Employers Health Insurance no gives expla- nation or examples. Nothing else file bill or the Representative Memorandum from Albers to Gordon Anderson, Attorney, Senior Council, Staff Legislative Wisconsin (available January Council, at Legislative Wisconsin Wisconsin) added). Madison, (emphasis 14The "made Wisconsin, whole doctrine" in also called the Rimes doctrine, prevents subrogation by acting as a "rule of priority, only such that where an injured party has an received award .. . which pays all of damages, his elements of including those already for which he has been insurer, indemnified an any Co., is there Petta ABC subrogation." occasion for v. Ins. Reference Legislative records in the Wisconsin drafting "cre- Legislative Council explains Bureau or Wisconsin Thus the of the made whole doctrine. ative application" no insight about provides application memorandum other than of the last sentence Wis. Stat. rights subrogation an wanted company insurance protected.15 be document entitled Ex- Second, a one-page As- Amendment to Engrossed planation Proposed Evidence Other Admissibility Bill 36: sembly lan- Sources reduction mandatory explains protect subrogation rights deleted to was guage *19 of The author and source this companies. insurance document is not are not identified document that Wis. explains The document dated. an require does not adopted as proposed were some health insurers
offset reduction because rights. not The they subrogation concerned that lose as follows: part reads in pertinent document "col- first . modifies the Explanation: The sentence .. regard- by allowing evidence merely rule
lateral source" presented of to be ing compensation other sources It does malpractice in a medical action. award any malpractice require an offset or reduction any payments. Some health by other the amount might affect their expressed concern that this insurers (internal 251, 28, 639 18, Wis. 2d 692 N.W.2d 2005 WI 278 omitted). and citation quotation 15 rule has blocked the assertion The collateral source policy expressly subrogation rights when the insurance even Gassner, 67, 2002 WI subrogation rights. Ruckel v. reserves See ("[W]e 43, 280, pursuant hold that 2d 646 N.W.2d 253 Wis. cases], an insurer is not whole doctrine [made to this court's until the against insured unless and subrogation its entitled to language to the whole, regardless insured of contractual made is contrary.").
ability subrogation rights whereby their to exercise they injury, an pay for then seek to recover from the plaintiff plaintiff again if the receives compensation through Accordingly, award. the last (which subrogation rights sentence clarifies that are exercised) seldom are unaffected.16 all companies Not insurance have same interests regard to collateral source rule and as subrogation, this memorandum demonstrates. In- surance companies victim of medical mal- insuring for the practice victim's medical want to retain expenses the collateral source rule and subrogation so that rights can be they reimbursed the tortfeasor for the pay- ments made for the they victim's medical expenses. Explanation for Proposed Engrossed Amendment Assembly goes Bill on to describe the comments of an American Reporter's Study relating Law Institute to modifica tion of the collateral source rule. These comments were not regard made in to the Wisconsin bill.
According study ato commissioned the American Institute Law [Reporters' Study Enterprise Liability Injury, April and Personal II, p. 167], nearly vol. half of all states ... have modified the admissibility "collateral source" rule either allow of other made, or, going step further, require mandatory one recovery. offsets to there no assure double There main are two First, reasons for this modification of the collateral source rule. *20 economists who have studied the effects of reforms various tort yields have concluded that collateral source rule modification savings run, long only caps substantial in the second on Second, in terms of effect on overall costs. fairness is by reducing enhanced the likelihood of double recoveries and juries allowing compensation to take other into account in deter- mining the amount of an award. Explanation Proposed Engrossed Amendment to Assem- for bly Admissibility Sources, Bill 36: Evidence Other of of (available Drafting Records, Assembly Bill 36 at the Wisconsin Wisconsin). Legislative Bureau, Madison, Reference companies insuring a health care contrast, insurance provider want to eliminate the collateral tortfeasor money they pay can a less for so that victim source rule expenses; compa- medical these insurance the victim's subrogation they eliminate so that need nies want to company pay for medical ex- a insurance not victim's company paid.17 penses The the victim's insurance legislature apparently of the added the last sentence compromise take into account of statute as some sort compa- divergent insurance interests of different compromise unintelligible however, in the is, nies. The 893.55(7). context of Wis. Stat. legislative files have references Third, Reporter's Study that rec- American Law Institute
an statutory among things, modifi- other ommended, rule should include cations of the collateral source provision mandatory providing of a for reduction "by present plaintiffs the amount tort award collateral from all future sources estimated proponents except The life insurance."18 benefits Study Reporter's of the thus were well aware bill Study's ap- proposed deliberately adopt did proach. January 27, 1995 memorandum Fourth, a Legislative Anderson, A.
from Wisconsin Gordon Sheryl attorney, Representative Albers Council staff (co-chair) Assembly Commit- and other members (and subroga rule source abolition of the collateral The tion) anomaly: company an The victim's insurance results in expenses and the for medical compensates victim paying the victim's company insurance is relieved tortfeasor's expenses. Institute, Study: American II Enter Reporters' Law (1991). Injury 182 Responsibility Personal prise *21 Insurance, on Policy
tee Securities and rein- Corporate 893.55(7) forces that of Wis. Stat. is to purpose admissibility alter the of collateral source payments, change not to the substantive of the collat- application eral rule. admits, source The memorandum candidly does not highlights, explain consequences admissibility of the collateral memorandum source The payments. reads in relevant part:
5. Collateral Sources
Currently, injured if party brings an an action against person allegedly who injury, caused that party information the insured ben- has received injury source, efits for that from another as a such insurer, health disability insurer or income is not ad- missible as evidence the action. Assembly
Under SECTION 7 of Bill evidence of any compensation bodily injury for received from sources other than the compensate defendant to [sic] the claimant for the injury is an admissible in action to recover malpractice. for medical provision does not the consequences state of that ad- (i.e., missibility is the trier expected of fact to award damages based on difference between the actual damages and the amounts received or to award dam- ages which include the paid by amounts the "collateral sources").19 46. The most reasonable explanation of the stat- on ute the basis of legislative history that Wis. Legislative Wisconsin Council Staff Memorandum from Anderson, A. Gordon Senior Staff Attorney, Representative Assembly Albers Members of the Insurance, Committee on (available Corporate Policy,January 27, Securities and at Wisconsin). Legislative the Wisconsin Council, Madison, *22 893.55(7) simply a modification of the became Stat. evidentiary aspect the rule,
of the collateral source not aspect.20 substantive legislative history Although
¶ the indicates modify legislature what is intended evidence the malpractice action, not in medical it is admissible impacts our case law defin- clear how that modification ing as the reason- "reasonable value of medical services" rendered, limita- of medical services without able value paid, or how modification affects to amounts that tion subrogation. and collateral source rule the concepts emerge key from this 48. The history legislative collateral are as follows: the source abrogated; modification of the modified, is not rule of the rules of source rule is modification collateral payments; of other to allow evidence evidence explicit of an modification the sub- modification not a collateral source collateral source rule that stantive expenses; payment an of medical does reduce award not subrogation rights preserved are and seem and trump other considerations.
C explicitly goals legislative set are 49. The 893.55(7) adopted was in the Section forth statute. Liability modify the 1975 1995-96 session Note, Gobis, v. Wrensch: Another Linda Lambert See J. in Wis the Collateral Source Rule Step Abrogation Toward ("As evidence, consin, [the a rule 1988 Wis. L. Rev. re of evidence precludes source introduction rule] collateral from collat any plaintiff obtained sources garding benefits it damages, precludes a rule As eral to defendant. receipt offsetting plaintiffs of collateral
defendant from against judgment."). the ... compensation Compensation chapter Patients Act, which created along provisions in the Statutes, Wisconsin with other governing July medical actions, effective Chapter adopted per- 655 was in reaction ato malpractice.21 ceived crisis medical 893.55(7) goal 50. The immediate of Wis. Stat. arguably provide was fact-finders with information hope about the collateral source in the recovery victims would not obtain double as a result of prevalence publicly privately the increased provided of both expense goal insurance.22The ultimate providers' would be to reduce health care *23 premiums insurance as a result of a reduction of victims' recoveries.
21Larry Stephen Milner, Comment, The Constitutionality of Malpractice Medical Legislative A Survey, National Reform: Loy. 1053, U. (1986-87); Chi. L.J. Mathy, Pamela Com ment, Testing the Constitutionality Medical Malpractice Legislation: The Wisconsin 1975, Medical Malpractice Act of 838, 1977 Wis. L. Rev. 839-40. 22 The Delaware Supreme Court declared that purpose a similar statute prevent was "to the collection of a loss from a (such collateral public source Security) as Social and then the collection for the same loss from the party or hospital being Uhde, sued." Nanticoke Hosp., Mem'l Inc. v. 1071, 1075 498 A.2d (Del. 1985). The Arizona supreme court declared that the purpose of its statute is to inform the fact plaintiffs finder of the true extent of the economic in inequity loss order to avoid the of windfall recoveries. The resulting judgments will no doubt reflect a set-off for the benefits plaintiff already has judgments received and these lower would be reflected in premiums, lower insurance one of the objectives legislation. of the It should be noted that admission into plaintiffs' evidence of way guarantees collateral in any benefits no
reduction in awarded the trier of fact. Eastin v. Broomfield, (Ariz. 1977). 744, 570 P.2d possible interpreta- ¶ 51. We therefore examine 893.55(7) legislative his- tions of Wis. Stat. tory with goals along key legal mind, in with three 893.55(7): concepts implicated in valu- Wis. Stat. expenses; medical the common law ation reasonable subrogation. rule; collateral source We shall discuss finally concepts in turn forth three and then set these interpretation light text, of the our legislative legislative history, goal and con- these cepts.
D person injured by calculating damages, malpractice may value medical recover the reasonable reasonably required by the of the medical services [the injury.23 recognized in "most We cases have services] is the actual value of reasonable expense, but in cases it not. But the test is some is charge, and value, not the actual therefore reasonable charge."24 not a need be actual It is controver- there no proposition recovery for the that the value sial ("An Milner, supra also note at 1068 increase
See nationwide, utilization of protection insurance combined with *24 rule, however, multiple has resulted in [collateral source] this recoveries."). 23 Co., Transp. & 56 Wis. Thoreson v. Milwaukee Suburban (1972). 231, 243, 201 745 2d N.W.2d
24 111, 56, WI Leichtfuss, Id. See v. 2001 also Koffman ("[W]e 31, 2d 201 have determined that 246 Wis. 630 N.W.2d of recovery of the reasonable value plaintiff was entitled seek to the medical rendered without limitation expenses insurers."); v. Ellsworth paid by plaintiff amounts and his (court Schelbrock, WI 63, 678, 611 N.W.2d 235 Wis. 2d 764 applies medical that collateral source rule concluded expenditures actually services, not for the made or the obligations nursing incurred.25 That medical and ser- gratuitously preclude vices are rendered "should not injured party recovering from the value of the services part compensatory damages."26 as of his argue 53. The defendants that Wis. Stat. 655.009(2), changed 1975, enacted in the standard for determining the reasonable value of medical in services malpractice provides medical cases. Section "[t]he jury, that applicable, court or the which ever is expense pay- shall determine the amounts of medical previously ments incurred and for future medical ex- pense payments." persuaded
¶ 54. areWe that this statute changes long-standing rule that the "reasonable value of medical services" is the reasonable value of rendered, services without limitation to paid. long-standing applied amounts This rule has been chapter in both 655 medical actions and in other determining actions as the method for the rea- sonable value of medical services. benefits;
assistance rejected argument recipient public assistance did not incur liability for medical expenses and was not entitled to award of or benefit of collateral source rule). See also I The Law Damages 9.9, Wisconsin at 8 (Russell 2005). ed., Ware 4th ed. ISee The Law Damages Wisconsin, supra note ("Several 9.9, at 8 n.32 Wisconsin cases have reaffirmed the general rule plaintiff, on the basis of the collateral source rule principles subrogation, is entitled to recover the reasonable value of the health care services rendered rather than the amount actually paid to provider." (citing Koffman Ellsworth)).
26Thoreson,
E prin- second, next examine the related We 893.55(7), ciple implicated Wis. Stat. the well- recognized common law collateral source rule. The helps "rea- collateral source rule claimants recover the services, sonable value of the medical without limita- paid."27Regardless tion to the of the method of amounts financing expenses, the victim's medical a tortfeasor's liability value of the treatment ren- reasonable actually paid dered without limitation to the amounts rule, source the victim. "Under the collateral injured person awarded to a be- amount cause of another individual's tortious conduct is not injured party compensation when the receives reduced . . . ."28 from another source 31, Koffman, 246 Wis. 2d 2.¶
28Ellsworth, 235 Wis. 2d We cited Restatement (Second) adopting of Torts 920A the collateral source rule approval with in Ellsworth at 8.¶ *26 policy
¶ 57. The basis for the collateral source legally responsible for rule is that a tortfeasor who is causing injury or her an should not be relieved his obligation compensate simply the victim because foresight arrange, good the victim has a for receive, fortune to injuries benefits from collateral source justification expenses.29 underlying An for rule that should a windfall arise because of an payment, party profit from outside that collateral injured person, not the tortfea- source should be The collateral source rule also ensures that the sor.30 liability similarly depen- situated tortfeasors is not fortuity of the manner in dent on the relative which expenses are each victim's medical financed.31 More- although may get duplicate plaintiffs over, ery, many recov- some fully plaintiffs are far from com-
successful considering, attorney pensated, example, fees and costs.
¶ Furthermore, 58. the collateral source rule is designed wrongdoing; "deter[s] negli- to deter rule gent by placing wrongful conduct the full cost of the conduct on the tortfeasor."32
¶ 59. Those critical of the collateral source rule argue recovery: a a that the rule allows victim double payment by payment and a tortfeasor collateral source. 29 31, Koffman, 246 Wis. 2d
30
370,
(citing Campbell
374,
Id.
Sutliff,
v.
193 Wis.
214 N.W.
(1927),
grounds by
374
overruled on other
Powers v.Allstate Ins.
(1960).
Co.,
78, 92,
10 Wis. 2d
often does not incur out of for medical stating: services, system
The employs myriad modern health care a of arrangements. part health care finance As of the system, negotiated and contracted discounts between providers increasingly health care and insurers are prevalent. agreements, Pursuant to these an insurer's liability for the medical expenses billed to its insured rates, is often at satisfied discounted with the remain- being der "written-off1 the health care provider.33 893.55(7) Wisconsin Stat. in was not at issue Koff- fully opera- man, and the collateral source rule was plaintiff tional in that The case. in that case was recovery entitled to seek of the reasonable value Koffman, 246 Wis. 2d to the amounts limitation services without medical paid.34 conjunc- works The collateral source rule subrogation Plaintiffs do and reimbursement. tion with recovery necessarily actually even receive double fully they and the the tortfeasor collect from both if may have source, a collateral source collateral because subrogation right or reimbursement.35 893.55(7) explicitly pro- 63. Wisconsin proce- limit the substantive or that it does not vides upon rights persons who have claims based dural subrogation. legislature explained previously, As we a fact-finder offset collateral mandate that did not determining the reasonable value of source Subrogation protect subrogation. medical services helps and makes it at least reduce an insurer's losses theoretically possible premium to limit for an insurer subrogation charges accordingly. protection The has justify source the collateral therefore been used relationship to the collateral rule.36 large subrogation extent dictates to a source rule interpretation of the statute. F *28 legal principle ¶ 64. turn now to the third We subrogation. By statute, in the virtue of embodied (the subrogor), payments on of the victim made behalf right payor (subrogee) a to recover a sometimes obtains against payments in an a tortfeasor and is these action 34Id., 2, 31. ¶¶ 35 10, Dobbs, § 8.6 at 496. supra note 36Id., §8.6(3), at 496-97.
34 against necessary party the tortfeasor.37 in an action ultimately Subrogation to ensure that the loss is exists wrongdoer prevent placed upon and to victim (the being unjustly through subrogor) enriched from recovery, namely recovering pay- from both the double (the entity subrogee) ing party and the An tortfeasor.38 right subrogation right can to subro- with a waive plain- gation in favor of reimbursement.39 Successful of collat- tiffs thus must sometimes reimburse sources principles payments The out of tort recoveries. eral applicable right subrogation are when the is therefore as a reimbursement. asserted ordinarily Subrogation
¶ works tandem 65. goals of collateral rule to further the with the source prevents rule ben- both rules.40 collateral source inuring victim from to the tortfea- efits received receiving subrogation prevents the victim from sor, and payor may recovery of the benefits a double because the payments from the tortfeasor or vic- recover the recovery of double words, In when the risk tim.41 other part the victim does not exist because on the may subrogation, payor source rule the collateral seek applies.42 admitting with statutes col- other states rights subrogation payments evidence,
lateral source payor protected, explicitly of the collat- and the are (the subrogee) prohibited from eral source 37 (citations omitted). 31, 246 2d 33 Koffman, Wis.
38Id.
39 596, 579, Flooring, 181 Wis. 2d Jindra v. Diederich (1994). N.W.2d 855 2d Koffman, Wis. 41Id.
42Id. *29 contrast, In the Wisconsin
receiving reimbursement.43 893.55(7) § chose in Stat. legislature protect Wis. of who have rights persons substantive procedural choice is clear on subrogation.44 claims based This upon in history, the face of the statute and as legislative explained. we previously 893.55(7) §of Any interpretation 67. must
therefore take into account the statute does not limit the of claims on rights subrogation. based
I—I h-H HH mind, these in principles interpret With we 893.55(7). § Wis. Stat. text renders admissible
evidence of for any compensation bodily injury received This alternative is recommended the American Law Institute, II Reporters' Study Enterprise Responsibility (1991). Injury Personal 161-82 see, subrogation, e.g.,
For other states' treatment of Ala. § 12-21-45 (2001)(upon proof plaintiff plain- Code that the obligated repay tiff is the medical been expenses which have reimbursed, plaintiffs evidence of reimbursement or (no 3333.1(b) (2005) admissible); Cal. Civ. Code source of collateral benefits any introduced evidence shall recover against plaintiff subrogated rights amount nor be to the defendant). against plaintiff
44The explain Wisconsin statute does not how subrogee's rights contrast, are to be protected. Kentucky provides plaintiff notify subrogees statute that a must that their subrogation rights by failure to assert intervention rights lawsuit will result in respect loss those with to the final the plaintiff Ky. award receives. See Rev Ann. 411.188 (2004). This statute declared grounds was unconstitutional on unrelated to provision. O'Bryan Hedgespsth, this See v. 1995). (Ky. S.W.2d571 *30 compensate the defendant to other than from sources injury bodily in a medical for the claimant damage the fact-finder text does not direct action. The of collateral source consider or use evidence how to payments. in statute, The unlike statutes Wisconsin require an offset or reduction states, does not other any malpractice by of collateral the amount award payments. source history, According legislative
¶ the first to the 70. 893.55(7) § the collateral modifies sentence of Wis. Stat. regarding merely allowing by evidence rule source presented compensation to the to be other sources malpractice action. Stat. in a medical Wisconsin 893.55(7) long- abrogate, modified, but did not standing rule that common-law collateral source value of medical services is the full reasonable value of by any collateral services, limited payments. source rights persons are whose claims 71. subrogation Stat. are not limited Wis.
based on 893.55(7), makes in the statute the last senten'ce as original the statute in the draft of clear. The sentence requiring be reduced under ch. 655 shall injured party by any compensation received from com- made insurance than the defendant sources other subrogation rights panies worry would be that their adversely was therefore affected, and the sentence eliminated. reimbursement) (or subrogation order to work tandem collateral source rule
and the subroga- recovery protect prevent a victim's double interpreted must be tion, require Wis. juries the collat- to consider to instruct
courts only determining reason- eral source rendered. the medical services able value of interpretation An alternative Wis. Stat. § 893.55(7), is, to allow a fact-finder to offset the payments, many questions collateral leaves source un- legislature answered that the could not have intended this court to answer. The statute is silent about the parties' ability argue
to introduce evidence or about obligation repay collateral sources. The statute is admissibility silent about the and consideration expenses acquire fact-finder of the victim incurred to payments. the collateral source The statute is silent ability parties argue about to the fact- public policies underlying finder the the collateral *31 subrogation. source rule and The statute is silent about ability parties argue inequity the resulting the about providers
to health care who receive reduced payments they provide patients for the care aas governing programs, result of rules Medicare and other while the reasonable value of medical services is valued many at the full reasonable value. With so unresolved regarding ability issues a fact-finder's to make discre- tionary legislature off-sets, we must conclude the jury intended that the not do so. 893.55(7)
¶ 74. We conclude the text of explicitly payments allows evidence of collateral source malpractice to be introduced in medical actions. We further payments if conclude that evidence of collateral source including
from sources Medicare, other state government programs, or federal medical insurance or write-offs, and discounted or free medical services is presented parties to the fact-finder, then the must be jury any poten- allowed to furnish the with evidence of obligations subrogation tial or reimbursement. Be- cause the text does not inform a fact-finder what do interpreting evidence, with the the statute and determining must do the evi- what fact-finder with legislative the statute, consider the text of the dence we legislative history, goal, and three common-law encompassed concepts actions in medical 893.55(7), namely reasonable value Stat. Wis. services, rule, source and subro- medical collateral gation. instruct conclude that the circuit court must We that it not reduce the reasonable the fact-finder must collateral on the basis of the value of services jury Although payments. not to source instructed payments source to reduce use the evidence collateral services, evidence of collateral for medical award may to determine source be used value of medical services. reasonable that our The facts of this case illustrate leg- interpretation of Wis. fulfills objectives. policies case, Medicare this islative party rights of from was but has reimbursement not parties. concepts reimbursement and subro- gation are similar. an for the value If the estate recovers award rendered, the estate would
of the medical services recovery necessarily it would have a because double obligation in- In the have reimburse Medicare. an *32 attorney three for the estate received case, stant (dated July lengthy 12, 30, 2001; December letters January respectively) from Medi- 22, 2001; type advising attorney in of the boldface care, each obligation Medicare for Medicare to estate's reimburse any recovery payments it receives or settlement out may litigation. seek of the Because Medicare as result protect right reim- reimbursement, Medicare's apply. That rule should the collateral source bursement advised of the estate's is, the fact-finder should be obligation potential fact-finder Medicare and the should not reduce an award to the estate the collateral payments by potential source Medicare because of the obligation repay Medicare.45The defendants assert they, may too, be liable to Medicare. It does not 893.55(7) appear that can at the same time allow an payments, protect parties offset for collateral source protect rights to the action, and of Medicare, which provided payments. Accordingly, collateral source jury may payments hear evidence of collateral source and evidence relevant thereto to determine the reason- able value of the medical services but must not use the payments collateral source anas offset to determine the reasonable value of the medical services.
¶ 77. Because the circuit court failed to advise the jury that it must not reduce its award for the reason- expenses by able value of medical the amount of the payments, collateral source we reverse the circuit judgment court's and order and remand the cause for a new trial accordance with this decision on the issue hospital expenses. of the and medical
IV Irrespective interpretation of Wis. adopted, the circuit court committed prejudicial error and a new trial must be held on the hospital expenses. issue and medical ¶ 79. requested this case the estate's counsel an informing jury instruction the estate was obliged proposed reimburse Medicare. The estate's jury instruction would have allowed the to hear consider evidence of collateral source
45 Koffman, 2dWis. *33 determining of medical services. the reasonable value proposed also allowed the would have The instruction obligation potential jury the estate's to consider proposed instruction reimburse Medicare. The estate's read as follows: Payments
Collateral Source Wisconsin, injured an the law the State of Under Medicare, usually is entitled to party or that party, of medical services recover the reasonable value cause, is a whether or negligence person which the free, regardless of provided are for not services pays Medicare bill. or not an insurer or whether parties negligent hold the The of this rule is to purpose holding responsible for their them accountable acts they have caused. for the value of the as However, negligence in medical cases such this one, you testimony hear allows Wis. Stat. insurance by Medicare and
regarding payments made you reduce the require The statute does sources. of the by you to the reasonable value
sum found be defen- negligence of which services by any by any made such payment dants a cause was may do so. source. You however, instructed, the Estate of
You are Medicare to reimburse Lagerstrom obligated Vance made it. expenditures jury proposed instruc- circuit did not use this court tion. allow the circuit court did not even 80. The might potential it have to tell the
estate obligation circuit court Medicare.46 The reimburse argue that the could, wished, if it ruled that the estate 46 R. 127:125-26.
estate argue "could reimburse Medicare." It could not that the to so. might required estate be do 81. The given instruction did not advise the jury
¶ of the estate's Medi- potential obligation to reimburse care. jury was instructed as follows: MEDICAL, HOSPITAL,
ESTATE'S RECOVERY FOR AND FUNERAL EXPENSES (b) question
Subdivision asks what sum of fairly money reasonably will and compensate the Es- Lagerstrom tate of for the Vance reasonable value of the hospital expenses necessarily medical and reasonably incurred in care of the him from the date of the infusion to death, Ensure incident the time his injuries him resulting because to as a result of the Ensure incident. negligence one, medical cases you such as this testimony
are to regarding allowed hear payments Medicare, by made insurance and other sources. The not require you law does to sum reduce the found you to be reasonable value of the medical services of negligence which the defendants was a cause any payment by any may such source. You do so. It is you jury for to decide. 82. This jury infirm, instruction
¶ aside from 893.55(7). any consideration of Wis. Stat. The instruc- tion to the given is deficient jury because it does alert the estate is potentially obligated reimburse Medicare. 83. The estate contended at trial it had
legal for obligation reimburse Medicare Medicare's expenses. According to the record, Medicare asserted explicitly its intention to seek reimbursement for its payments. court Nevertheless, the circuit barred the potential obliga- introducing of its from evidence
estate further Medicare and barred the tion to reimburse arguing the fact-finder that it would not from estate recovery getting if fact-finder awarded a double be of medical services. it the full reasonable value According of the reason- calculation rendered, the collateral medical services able value of (or reimbursement), subrogation source rule recovery part did not on the estate of double risk *35 present necessarily circuit court exist the case. The argue to an incorrect inter- forced the defense counsel jury, namely pretation that the estate law to the merely option repay to Medicare. Under these had the jury did not have full information to circumstances the any and services, medical value of reasonable decide the controversy has not The real decision was erroneous. fully tried.47 been clearly prejudiced when 86. The estate was introducing from evi- the estate
circuit court barred potential obligation to Medicare about its dence gave did refer the estate's that not an instruction obligation potential The Medicare. result to reimburse only for medical estate recovered $755 that was although may expenses Medicare have to reimburse it larger significantly sum.48 for argue that much The defendants not relate to the medical treatment did
decedent's prove failed to and that the estate medical paid specific charges for Medicare services what Cont'l AG, 325, 89, 2d v. 235 Wis. 47 Morden 2000 WI 611 N.W.2d
48 See, 411.24, e.g., 411.37. C.F.R. malpractice.
related the medical The defendants also argue facing the difficulties estate stem not from Wis. or the instructions but from party. the estate's failure to name Medicare as a The defendants had contend that Medicare been named aas party, presumably the statute would have worked as payments intended: Evidence of Medicare's would have subject been to cross-examination; admitted Medi- care would have been on verdict and issue of obligation longer estate's to Medicare no would exist. they potential The defendants assert that too have liability subject they to Medicare, and that would be liability jury greater double if the awarded expenses to sum, the estate than the awarded. $755 according party defendants, to the neither should have argue specifically been allowed to about Medicare be- party. cause Medicare was not a Yet Medicare consider- important, were ations once its were submit- jury. ted to the
¶ 88. The effect of the circuit court errors on the significant. estate was not was informed of the may responsible crucial fact that the estate be part By allowing $89,000. Medicare all *36 jury hear to evidence that Medicare could recover a sum in estate, excess of from the the circuit $755 court committed reversible error. Irrespective proper interpretation of the of § 893.55(7),
Wis. Stat. we conclude that the circuit admitting court erred in not evidence of the estate's potential obligation to reimburse Medicare. Accord- ingly, judgment we the reverse circuit court's and order and remand the cause for a new trial on the of issue the hospital expenses. and medical
44 V ex- next of funeral turn to the issue 90. We in to five-day trial, of the response At the close penses. verdict,49 4 on the jury the Question special Number for any the compensation declined to award estate at trial estab- Undisputed evidence funeral expenses. $7,610.10. The the totaled lished that funeral expenses a was cause negligence found the defendants' jury decedent's death.50 moved, pursuant After trial the estate (c), have answers the the
Wis. Stat. evidence ground that was changed verdict on response to sustain the answer.51 insufficient of funeral motion on the issue estate's post-verdict under Stat. defendants that Wis. argued expenses, expenses, funeral but 895.04, "may" award jury do The defendants a so. required that not evidence in this case establishes "[t]he argued Question 4 read: "What sum of Verdict Number Special reasonably the Estate of money fairly compensate and will following re damages in each of Lagerstrom for Vance Ambulance, $20,000. b. suffering: pain His spects: a. rehabilitation, home, and bed hold nursing medical, hospital, c. Expenses: $0." Funeral expenses: $755. negli Question 3 read: 'Was Verdict Number Special Werth and Red agents Myrtle
gence employees such Lagerstrom's death? Answer: Yes." of Vance Cedar Clinic cause 805.14(5)(c) Change "Motion to reads: Wisconsin change court to an answer Any party may move the Answer. insufficiency of the evidence to ground the verdict on the the answer." sustain change in the verdict also
The defendants moved support did ground that at trial on the evidence answer finding negligence. jury's *37 jury could have concluded that the decedent was
going anyway going to .. .," die and that the was estate expenses regardless to incur funeral of what illness eventually killed decedent. The circuit court denied the motion estate's change expenses
for a in the verdict award funeral judgment reflecting jury's and entered award of $0 expenses. for funeral [this is] court, 93. Like the circuit "when court
requested change [or jury answers] an answer in a [we view] light verdict,. .. will evidence ... most favorable to the verdict and the will verdict be supported by any affirmed if credible evidence."52In the argues alternative, the estate this court should expenses determine the reasonable value of the funeral accept and order the defendants additur under Wis. 805.15(6)53 retry or the issue the funeral expenses.
¶ 94. The
instruction
read in relevant
(c)
part:
question
4
"Subdivision
asks what sum of
money
fairly
reasonably compensate
will
the Estate
52
Co.,
272, 282-83,
v.
Nelson
Travelers Ins.
80 Wis. 2d
(1977)
Keane,
(citing
524,
N.W.2d 48
Roach v.
2dWis.
(1976)).
verdict or preju- is excessive not due to (other during dice or as a of error result trial an than error as to damages), the court shall determine the amount which as a matter reasonable, law is shall order a new trial on the issue of damages, days party option unless within 10 to whom the accept judgment changed offered elects to in the amount. *38 Lagerstrom ex- for the funeral and burial of Vance Lagerstrom."54 penses of Mr. Eventually, all die.55But fact we must that may to refuse award not mean a fact-finder
does
expenses
of the
when the victim
funeral and burial
elderly
malpractice
and, in the absence of
is
medical
likely
malpractice,
a
to die sooner than
was
younger
The
was a cause of the
victim.
law, for
liable,
is
as a matter of
death and the tortfeasor
expenses.
and burial
reasonable funeral
change
to
an
the role of the circuit court
It is
any
complete
if there
lack of
on the verdict
answer
support
here
answer, and it was error
to
the
evidence
deny
to
to
the estate's motion
for the circuit court
change
regarding
fair and reasonable
the answer
the
expenses.
undisputed evidence
of funeral
amount
expenses
$7,610.10. The defen-
that funeral
totaled
was
evidence,
otherwise,
to
no
credible
dants offered
finding
negligence
figure. Upon
dispute
this
necessary to
amount
causation,
fair and reasonable
the
Mendivil,
665, 671-72,
v.
2d
548 85
Richards
Wis.
(Ct.
1996) ("However,
may
the
appellate
an
court
overturn
App.
if the
change
jury's
record
decision
the
answers
trial court's
v.
Weiss
wrong.'")
(citing
'clearly
was
the trial court
reveals
Co.,
Fire
389,
The circuit court reasoned as jurors'] belief was that even my [The sense. apply common family and the the defendants this negligence the without very Lagerstrom period short of time of Vance were in a estate the expenses, those even without going required pay to be negligence of the defendants." the funeral
compensate expenses estate for $7,610.10. to the any absence of evidence was contrary 97. The circuit court should have entered the on $7,610.10 sum verdict form special response amount question asking fairly what would the estate for the reasonably compensate funeral ex- fact, penses. parties contemplated having just that, circuit court do although because timing estate's it was decided let request, *39 to the it question go jury.56 Nevertheless, is the long- rule that: standing drafting special a trial verdict the court must first by
consider the pleadings. [The issues raised the court] should then eliminate from the issues so raised those submitting before special Just the verdict form the jury, the circuit court and counsel having discussed the court enter the expenses: amount of funeral right. Any
THE COURT: All other comments or concerns about the verdict form? strong feeling, [Counsel estate]: MR. HARRIS for I don't have a think, your question C, I expenses, Honor. would that funeral — by C, funeral, could he answered the Court. But on 7610.10 Exhibit 11. MR. guess [Co-Counsel DUBEAU the defendants]: Yeah. I I problem don't a I have with that. don't know if the then Court damage question" needs to do the "I'veanswered the instruction as well, too. way MR. HARRIS: That's fine. Just leave it the it is. you.
THE COURT: Thank MS. [Co-Counsel LUBINSKY might defendants]: for the That be confusing point. too at this Yep. THE COURT: on trial by the evidence the are determined
that or admissions, by proof, uncontradicted failure of proof57 undisputed funeral ex- amount of the Here there the penses offered no evidence $7,610.10. Defendants was un- unreasonable otherwise that this amount was They implicitly conceded as much in the warranted. special colloquy the verdict form to submission of before jury. foregoing reasons, we reverse 98. For denying motion for order estate's circuit court's special change on form and verdict answer to enter on remand of cause order the circuit court special form for $7,610.10 on the verdict the amount of expenses. reasonable funeral foregoing reasons, we conclude 99. For 893.55(7)
although renders the text of Wis. Stat. bodily any compensation for admissible evidence injury defendant other than the received from sources compensate in a medical the claimant requires damage be action, for medical services the award instructed not to reduce payments; the collateral source in the amount *40 payments jury may consider, collateral source however, determining of the medical in the reasonable value services rendered. judgment
¶ reverse the 100. therefore We relating to the estate to the award circuit court expenses hospital remand the cause medical and hospital of new on the issue for a trial the circuit court 57 Co., 212, 216, 2d & Cas. 71 Allen State Farm Fire Wis. v. added) (1976) (quoting Bell v. Dues (emphasis 238 104 N.W.2d (1957)); v. 53, also Dahl 47, N.W.2d 821 see ing, 275 Wis. 80 (1970). 609, 342 K-Mart, 605, N.W.2d 46 2d 176 Wis.
49 expenses. and medical We order further the circuit court on of remand the cause to enter the amount of special $7,610.10 on the verdict form for reasonable expenses. funeral
By judgment the Court.—The of and order the circuit court are reversed and the is cause remanded.
¶ ROGGENSACK, 101. PATIENCE DRAKE J. (concurring dissenting part part). in I in concur majority opinion's Lager- the conclusion that Klover Lagerstrom (Lagerstrom) strom and estate of Vance proved expenses claim for $7,610.10. its funeral Majority op., ¶ Therefore, 8. I would order that judgment accordingly. circuit court enter a modified I majority opinion's also concur conclusion that 893.55(7) Majority op., Wis. is constitutional. majority opinion's ¶ 22. However, I dissent from the pursuant conclusion that evidence admitted 893.55(7) could be used fact-finder to abro- gate Wisconsin's collateral source rule1 in this case. Majority op., ¶ 5. legislature
¶ 102. The enacted Wis. Stat. providers' in order to reduce health care premiums by reducing insurance medical through expenses2 verdicts the use of evidence of plaintiff paid. incurred, has but has not rule, Under collateral source that a plaintiff entitled to recover from defendant cannot be reduced payments benefits from other sources. v. Koffman Leichtfuss, 111, 29, 2001 WI 2d Wis. N.W.2d 201. 2 1 only here, address expenses agree I but with majority that the statute is not so limited and could cover other types plaintiff made to a due to the fault Majority op., However, tortfeasor. agree I do not that the goes statute so far as to contemplate evidence "volunteer Majority services." op., *41 legislature's purpose, third when to achieve
order subrogation rights parties have or direct action with of joined, the plaintiff to reduce a must be able not been damages plaintiff for amounts the awarded to abrogating paid, thereby the collateral source has not Because the United rule those circumstances. under joined government lawsuit, in the was not States presents of a fact-finder's reduction case us before Lagerstroms expenses have care for amounts health permissible paid, I conclude is under which 893.55(7). Accordingly, § I affirm because would judgment court, an circuit as modified to include join expenses, I for do not $7,610.10 award of funeral majority opinion. A. Standard Review requires interpret appeal us to Wis. 103. This 893.55(7), question § of law that we which is
Stat. interpre court's deference to the circuit review without 68, Reed, 53, 13, 280 Wis.2d v. 2005 WI tation. State 695 N.W.2d315. 893.55(7)
B. Stat. Wisconsin 893.55(7) states: 104 Wisconsin injury bodily for any compensation Evidence defendant other than the received from sources injury for the is admissible the claimant compensate malpractice. for medical an action to recover proce- not limit the substantive This section does upon claims based rights of who have persons dural subrogation. plain begins interpretation with the
The meaning legislature. State ex of words chosen County, Dane WI v. Circuit Court rel. Kalal *42 ¶ scope 633, 45, 271 Wis. 2d Context, N.W.2d110. purpose ascertaining plain are relevant in meaning Accordingly, Id., ¶¶ of a 46, statute. 48. statu tory language interpreted is isolation, not but as part statutory may aof whole scheme that address a particular giving topic, proper closely-related accord to interpreted Id., ¶ statutes. 46. It is also to be reason ably, "to avoid or absurd unreasonable results." Id. (citations omitted). plain If the face, statute is on its it simply applied. ambigu is However, Id. if the statute is may legisla ous, we examine sources, extrinsic such as history, tive may Id., ¶ to aid in construction. 50. Statutes ambiguous legislature's through
be
use of
imprecise
Physicians
terms, See
v.
Landis
Ins. Co. of
Wis.,
¶86,
26,
1,
WI
245 Wis.
893,
2d
628 N.W.2d
through
the statute's interaction with other statutes,
White,
State v.
193, 198,
Wis. 2d
to what its should be. The provides concludes the statute for the admission payments by evidence others and write-offs of health charges care that otherwise would be inadmissible holding under our v. Leichtfuss, 2001 WI Koffman Majority op., 111, 31, 246 Wis. 2d 630 N.W.2d201. 70. majority opinion But once admitted, the holds that this evidence cannot be used aas subtraction from the plaintiff awarded a successful because to be Major- abrogate source rule. do ity op., the collateral so would my view, In that second conclusion is against explain it below, I cuts reasonable. As legislative purpose enactment damage behind reducing 893.55(7), the size of awards that of abrogation through the actions in medical doing prevent when so will rule collateral source plaintiff. windfalls or double recoveries legislature responded to first *43 provision perceived of health a in the what it as crisis creating rapid by the rise in medical ch. 655. It saw care malpractice began part problem, it to and
suits as
proce
creating
by
a number of
that concern
address
malpractice
required
ac
in medical
dures that were
Comp. Fund, 2000
v.
Patients
tions. Aicher Wisconsin
In
99,
2d
¶ 108. A for an amendment 893.55(7) original proposal for Wis. Stat. from 893.55(7), Joanne Senator Huelsman shows that as finally modify enacted, was created to the collateral permit source rule evidence other sources of payment presented to be to the fact-finders medical malpractice Legislative actions. See Reference Bureau Drafting File for Act 1995 Wis. 10. That amendment require did not an offset a reduction of payments. the award the amount Rather, of other Legislative pre- Reference Bureau's file shows that senting reduction, information to facilitate a while not requiring a reduction in each case, was done order preserve parties the interests of to the action that had subrogated rights. Legislative See id. The Reference Drafting Bureau File for 1995 Wis. Act also shows that states that have enacted similar modifications of experienced the collateral source rule have reduction by reducing in the size of medical verdicts possibility plaintiffs. of windfalls to id. See *44 Accordingly, interpret I Wis. 893.55(7) permitting damages as a reduction of plaintiff malprac- awarded to a successful in a medical plaintiff tice action amounts that a has incurred, but paid, has not for health care services. In order to 893.55(7) legislative accomplish purpose the for which was enacted, a reduction should occur when write-offs third-party payers rights have or occurred when with subrogation joined reimbursement or were not in the plaintiffs action. This is fair to who whole, will be made required and it is fair to defendants who will be give plaintiffs. or windfalls double recoveries to How- rights subrogated parties with ever, when third rights payment of their the of direct action due to joined injured expenses party's in the are adjudicated rights lawsuit, in that and their are lawsuit to owe amount the tortfeasor is found a reduction parties paid appropriate. for those would not be what parties paid medical otherwise, when the who Stated expenses repayment lawsuit, for in the the award claim parties, damages compensation for include those will injured party. as well as for the Lagerstrom paid us,
¶ 110. In the case before Lagerstrom sought only yet services, for medical $755 jury. paid $64,759.40 Medicare $89,375.78 from the provider $23,861.38 for write-offs received payment participation $88,620.78 as total Lagerstrom Lagerstrom's was health care services. everything jury's verdict because whole made Lagerstrom repaid by paid were was appeals. Lagerstrom Lagerstrom seeks all Yet, awarded. provid- paid the health care and all that that Medicare no one will bills, of their the latter of which ers wrote off Lager- pay. position, support In of that ever have to get he a windfall under asserts that should strom regard amounts that rule in collateral source potential liability he off has were written I made. that Medicare Medicare for the disagree contentions. with both regard that La- contention, first
gerstrom legally for the to a windfall entitled providers off, wrote health care amounts that interpreted. collateral While the statute cannot be so may plaintiff permit windfall to a when source rule malpractice, See on medical the claim is not based purpose of Wis. Stat. 31, 27, 2d Koffman, Wis. modify rule the collateral source was to *45 55 malpractice Accordingly,Lagerstrom actions. is only due expenses in so much reimbursement for health care Lagerstrom paid.
as That is sufficient to make Lagerstrom (Sykes, dissenting). Id., ¶ J., whole. 69 In my § interpreted permit view, be cannot to recoveries of off amounts written of hills for health care services medical actions and be consistent 893.55(7). legislative § policy underlying with the choice regard ¶ 112. to the second contention, that Lagerstrom $64,759.40 should recover that Medi- again paid, disagree. Lagerstrom purposefully care I government refused to name the United States as a party, involuntary plain- either as a or defendant as an pursuant Accordingly, tiff, to Wis. Stat. I 803.03.3 as explain judgment below, case this does not affect any government claim the United States has virtue payments of the Medicare that were made. participates pay- ¶ 113. When Medicare in the services, ment of health care at times it does so as a secondary payer by making payments. "conditional" § 1395y(b)(2)(B)(i). U.S.C. One the occasions when secondary payer Medicare is a and its are liability policy "conditional" is when there ais insurance plan may responsible paying or that be for the 42 CFR services. 411.21. If a Medicare conditional payment made, the Center for Medicare & Medicaid July The 30,2001, record reflects that on the United States government gave Lagerstrom's notice attorney regulations require your "Medicare's pay client Medicare days your back within 60 receipt of settlement insurance proceeds." Medicare then paid $64,759.40. had The also record reflects that attempted get the defendants Lagerstrom name the United as a necessary States party pursuant Wis. 803.03, Lagerstrom hut prevailed. resisted and verdict February dated adjudicate did not interests the United States. *46 Financing (CMS), an of Health Care arm
Services recovery (HCFA), may those seek Administration payments. re- can 42 CFR 411.24. CMS conditional parties payments have who from cover conditional 411.24(g). party payment." Section a third "received Lagerstrom. beneficiary, as Vance a such This includes party payment," "party a third If receives Id. a days. party 411.24(h). within 60 Section must reimburse Medicare may payment be reduced due Medicare The 411.37(a). by 42 of collection. CFR the costs liability settle- insurance 114. "In the case required [i]f as Medicare is not reimbursed ments ... (h) party by paragraph third [411.24], the of this section though payer even it has Medicare must reimburse beneficiary party." already 42 or other reimbursed 411.24(f)(1). liability insurance settlements CFR among lump not allocate sum, which does where a types beneficiary/ included, received, is by subject may recipient be claims of the settlement third-party payment a it has received CMS that Shalala, 67 Zinman v. Medicare is entitled. See which (9th 1995); Shalala, 943 F. Cir. Denekas v. 841, F.3d Supp. 843 (S.D. 1996); v. Smith Travelers 1073, 1075 Iowa 1989). (M.D. Supp. Co., F. Fla. Indem. by present a a settlement However, this case does Lagerstrom company, liability re- nor has insurance payment. lump Further- sum, undifferentiated ceived a any third-party Lagerstrom not received more, has paid by payment However, the Medicare. for sums right government does retain United States by recovery pursue it made of conditional respon- required against who action all were direct respect payment item or to the same make with sible to Accordingly, § 1395y(b)(2)(B)(iii). a service. U.S.C. against government the United States lawsuit precluded by insurer has tortfeasor's not been this against However, there lawsuit. Lagerstrom is no basis for claim jury's clearly under the itemized verdict. majority opinion The criticizes the circuit jury prevented court's instruction and it concludes controversy being fully Majority op., real from tried. Lagerstrom requested ¶ 85. instruction that Lagerstrom obligated said, "Vance to reimburse Medi- expenditures majority opinion care it." made *47 by refusing give Lager- asserts that to instruction, this prevented advising jury strom was from the of the obligation "potential" estate's to reimburse Medicare. Majority op., ¶¶ However, 79-89. the instruction La- gerstrom requested say "potential" liability. did not argued,
¶ Further, 116. as the tortfeasor's insurer "potential" liability the insurer has to Medicare. CFR 411.24(h)-(i). Lagerstrom Since refused to name the government party United States as the action, to both plaintiff similarly the and the defendants were treated regard arguments jury. in to the each could make the to Lagerstrom argue jury is, That could to the that if it paid, included in the amounts that Medicare it repay gov- would those amounts to the United States argue ernment, and the insurer could that amounts paid by Medicare should not be included in the verdict obligated because it remained to Medicare for those agree same amounts. Therefore, I the circuit court properly jury. instructed the my
¶ contrary view, 117. it would have been to give Lagerstrom requested law the instruction be- party cause Medicare was not a to the Instead, action. given purpose the instruction followed set out 893.55(7). legislature enacting Wis. Stat. The reduc- prevented Lagerstrom, tion made a windfall to prevented recovery it and a double that could have Lagerstrom to name the refused occurred because adju- party thereby government as a and States United Accordingly, appro- is not new trial dicate its interests. jury's Lagerstrom priate. verdict. was made whole may government have a States still That the United right made, it of action for Medicare Lagerstrom. Lagerstrom is with the choice left unfair may required be made, as the defendants who he are yet due to Medicare. with about what is deal CMS I above, out ¶ Therefore, set 118. reasons judgment court, circuit as affirm would expenses. $7,610.10 for funeral modified, to include Accordingly, part respectfully I concur majority opinion. part from the dissent in JON authorized to state that Justices I am join this T. PROSSER concur- and DAVID E WILCOX rence dissent. (dissenting). I WILCOX, E J. whole- 121. JON
heartedly join I Prosser's well-reasoned dissent. Justice majority only separately indicate that write yet represents opinion of this court another instance *48 legislature by rendering undermining intent of the the judi- through properly enacted creative statute void majority interpretation. Although has de- the cial unconstitutional, the effect of at issue clared the statute just majority opinion is the same. the PA- ¶ that Justice 122. I am authorized state joins opinion. ROGGENSACK, this TIENCE DRAKE 0dissenting). The PROSSER, T. J. 123. DAVID constitutionality challenges plaintiff-appellant the 893.55(7). the that admis- She also claims Wis. pay- "prejudicial source evidence collateral sion only out-of-pocket [she] her so that was awarded ments expenses value of instead of the reasonable medical
59 expenses incurred" to a entitles her new trial as expense damages. majority opinion to medical The key issues, reformulates the and then eviscerates a component of the medical statute. Because legitimate legislative decision court's countermands respectfully I action, dissent.
rH
provides
The
collateral source rule
that
injured person
awarded to an
are not to be
compen
affected
fact that
claimant received
sources,
sation
other
from
such as
leave or
sick
insur
Payne
Co.,
ance.
v.
424, 433,
Bilco
54 Wis. 2d
195 N.W.2d
(1972).
part
This rule in tort cases has been
Wisconsin common
at
law since
least 1908. Gatzweiler v.
Ry. Light Co.,
Milwaukee Elec. &
34,
136 Wis.
116 N.W.
(1908).
explained
Campbell
rule
in
was
v.
(1927)
373-74,
193 Wis.
Sutliff,
370,
Co., 2d 78, Wis. N.W.2d393 where the defendant that contended the trial court erred instructing jury, assessing the amount of the plaintiffs damages, "wholly disregard" the fact that injured plaintiff money had received from an acci policy dent insurance had continued to his receive salary injured. argued he while was The defendant plaintiffs damages "by should be measured the loss wages earnings actually he sustained" and that earnings employer there no were lost when his contin pay plaintiff throughout disability. ued to his Id. at rejected observing 374. The court this contention, prevailing country" "the doctrine in this was otherwise. (citing Superior Id. Co., Cunnien v. Iron Works 175 Wis. (1921)). 172, 188, 184 N.W.767 It added:
60 caused why reason one whose have see no acts We the reap another should entire benefit injury to wages employer, made an payment by the comes from employee faithful or because gratuity either to a as by payments are contract. Such required such payments the the change injury do the nature of which not wrongful through the acts of employee sustains by by payments If made profit either tortfeasor. has been person it should be the who employer, wrongful
injured, the one acts caused not whose injury.
Id. the collateral source Early discussing cases or contin
rule whether insurance addressed injured damages. an plaintiffs ued should reduce wages See the court considered medical Eventually expenses. Milwaukee, & Pac. St. Paul v. McLaughlin Chicago, (1966); Co., R.R. 395-96, 143 32 378, 2d N.W.2d 31 Wis. Co., 53-54, 191 Merz Old Ins. 47, 53 Wis. 2d Republic v. Schs., 83 v. Somerset Pub. Rixmann (1971); N.W.2d 876 (1978) 575-83, (collecting 326 2d 266 N.W.2d Wis. cases). & Suburban In Thoreson v. Milwaukee N.W.2d 231, 241-45, 2d Corp., Wis.
Transport at (1972), expenses the court discussed medical length: has been that general rule Wisconsin injured has been the tortious conduct
plaintiff who of his the reasonable value is entitled recover another injury. In most reasonably required medical costs it is but some cases expense, this is actual cases value, not the actual the test is the reasonable not. But necessary and nurs- charge [T]he .... fact gratuitously... are should ing services rendered recovering value of injured from preclude party damages. part compensatory as of his services those *50 Id. at 243. "We hold the rule collateral-source is not paid-for applies gratuitous limited to benefits but provided paid by medical services or for the state." Id. at (citing Damages 22 245 2d 207, Jur. at Am. 288 (1959); Hospital Davis, Annotation, R.E and Medical Injured By Furnished Services Person Government as Damages Affecting Injury Recoverable For Personal (1959); Death, Kron, A.L.R. 2d 68 876 Dahlin v. 45 N.W (Minn. 1950)). .2d833 principle
¶ 128. This was affirmed extended Schelbrock, in v. 63, Ellsworth 2000 235 678, WI Wis. 2d involving 764, 611 N.W.2d case Medical Assistance injured to a woman in an automobile acci dent, Leichtfuss, 111, send v. 2001 WI 246 Wis. Koffman 2d 31, 201, 630 N.W.2d another motor vehicle accident case in subrogation the which court drew distinction between the expense
interest in medical claims and the value of reasonable medical services rendered.
¶ In both Ellsworth and Koffman, Justice Sykes arguing question Diane dissented, that the real applied was not whether the collateral source rule but applied which measure of it Ellsworth, to. (Sykes, dissenting); ¶ 678, J., Wis. 2d Koffman, 246 (Sykes, dissenting). ¶¶ 31, Wis. 2d J., 67-74 example, plaintiff put expert Ellsworth, the in testimony regarding full retail value medical up received, services had she which added actually paid $597,448.27. The amount Medical accepted by was $354,941.21, Assistance an amount providers payment medical as Ellsworth, full. "[t]he Thus, Wis. 2d difference—almost providers legally $250,000 absorbed as —was unrecoverable." Id. majority plain- 130. The Ellsworth held higher
tiff was entitled to amount, recover the while the $250,000 the extra reflected dissent concluded highest payor paid for the same would have "what unjus- yielded id., ¶ an services," 31, and thus plaintiff. tified windfall for outset, the collateral source rule 131. From relieving
recognized a tortfeasor from the unfairness injuries simply liability for the tortfeasor caused full injured party foresight purchase had the because *51 bargain benefits, or because for insurance or other injured "compensation" party received other from years, however, collateral source. Over the collateral to inflate verdicts and lead source rule has tended recovery plaintiffs. rule double sometimes damages, provides and this an extra source of economic damages may significant noneconomic have be when by litigants capped legislation. Indeed, some have been get cap around the on the rule as a means to used strategy, damages. Using double re- this noneconomic covery byproduct rule; it is an is not occasional objective. appellate decisions the desired Inconsistent judicial turn of events. reflect ambivalence about this Compare Wrensch, 105, 2d v. 135 Wis. Lambert (1987), with N.W.2d Koffman. merits of the collateral Whatever past hand cases, court's the case at
source rule past presents in- cases, this case new Unlike issues. governed malpractice, which is volves medical unique legislature created set of statutes. 893.55(7), § the collateral which modifies Wis. Stat. malpractice Thus, the in medical cases. source rule principal rule affects medical issue is how the modified malpractice expenses A second issue is in medical cases. compensatory medical whether the measure of malpractice includes the reasonable in a medical case already value of medical costs absorbed the tortfea- specific sor. A third issue concerns the reimbursement rights of Medicare.
II governed by ¶ 133. Medical cases are (see 655.005(1) (a)), § Wis. Stat. ch. 655 Wis. Stat. as well § as Wis. Stat. 893.55 and a few other statutes like Wis. Chapter §~ 895.04 and 895.045. 655 and Wis. Stat. 893.55(5) (7) bearing §~ have on this case. 655.009(2) A. Wisconsin Stat. Chapter
¶ 134.
655 was enacted in 1975. See ch.
part
Laws of 1975. Wisconsin Stat.
was
original
legislation
changed.
of this
and has not been
expense payments,"
Entitled "Medical
it reads: "The
jury,
applicable,
court or
whichever
shall determine
expense payments previously
the amounts of medical
expense payments."
incurred and for future medical
655.009(2) (emphasis added).
Wis. Stat.
Because this
years
subsection became law more than two
after this
*52
Thoreson,
legislature
court's 1972 decision in
deemed to be familiar with the collateral source rule
is
application
expenses
and its
Thoreson.
to medical
as described in
(2)
speak
¶ 135. Subsection
does not
to medical
expense payments
"by
patient." Thus,
incurred
it
cannot be said to attack the collateral source rule head
Nonetheless,
speaks
"payments,"
on.
the subsection
of
past
future,
statutory
both in the
and in the
and this
passage
term makes it different
from the
in Thoreson
value,
that "the test
is the reasonable
not the actual
charge,
charge."
and therefore there need be no actual
Thoreson,
Logically,
expense
B. Wisconsin Stat. legislature 1986 the amended Wis. Stat. (5). § 893.55 to create subsection 1985 Wis. Act § 72b. This subsection reads: (5) Every damages award under ch. 655 shall of specify money, any, the sum awarded each if of
following for each claimant period for the from the date injury to the date of the award and for the period award, after the regard date of without to the limit (4)(d): under sub.
(d) expenses. Each element medical added). (emphasis Wis. Stat. damages,
¶ 137. Economic such as medical ex- subject penses, are not to the limit on noneconomic 893.55(4)(d). damages purpose Thus, Wis. Stat. (5) require specific of subsection make findings respect factual with to the of eco- elements nomic in medical Before cases. provision, enactment this courts had the latitude to special submit verdicts that combined elements of dam- (5) ages.1 practice in Subsection ended this (1982) following Wis JI —Civil 1750A included the com ment: long
It has been established that the trial court has absolute special Traditionally, discretion as to the formulation of a verdict. great diversity practice there has been a in the trial courts as to damage question special verdict is framed. Some how *53 (5) malpractice in tan- must be read cases. Subsection 655.009(2) (5) subsection dem with Wis. Stat. because every damages Chapter award of under refers to C. Wisconsin Stat. legislature specifically ad- 1995 the malprac- the collateral source rule in medical
dressed §10, Act 12m. The Act created tice cases. 1995 Wis. 893.55(7), Wis. Stat. which reads: any bodily injury re- compensation Evidence of than the com- ceived from sources other defendant injury in an pensate the claimant for the is admissible malpractice. action to recover for medical This limit procedural section does not the substantive or subroga- rights persons upon who have claims based tion. (7)
¶ 139. Subsection modifies the collateral by allowing compensation source rule evidence of other jury presented malpractice in a to be medical require It an or a of a action. does offset reduction any pay- award the amount of other permits jury ments, but it to make such a reduction considering compensation. after evidence of other Ad- mitting negates this information into evidence "wholly principle disregard" should damage single question; courts combine all in a elements others pain suffering disability, combine and future medical and loss earning capacity single question inquiry of future into a about injury plaintiffs personal submitting separate questions while as past expense past wage medical loss which are often added.) (Emphasis answered the court. expenses Future medical were often combined with other elements past expenses sepa- even when were listed rately. *54 legislative compensation. A
fact of other document describing Engrossed Bill 36, the source of 1995 explains: ActWis. reasons for this modification of main
There are two First, collateral source rule. who have stud- economists ied the effects of various tort reforms have concluded yields rule that collateral source modification substan- run, savings long only caps tial in the second on Second, damages in terms of effect on overall costs. by reducing
fairness is enhanced the likelihood of juries allowing to take other double recoveries compensation determining into account amount an award. of Engrossed Assembly
Proposed Bill 36: Amendment to Admissibility Compensation, in Evidence Other of (available Drafting Assembly Records, 1995 Bill 36 at Legislative Bureau, Madison, Reference the Wisconsin Wisconsin) added). (emphasis purpose modi- plainly. fication could not be stated more (7) is different from Wis. Stat. 140. Subsection 893.55(5) § § because, and Wis. Stat. its limited to evidence of for terms, it is not enough expenses. cover all kinds medical It is broad compensation from collateral sources for medical compensation malpractice. of this will have no Some subrogation right reimbursement, or which indicates recovery patient under that the would receive double statutory collateral rule the absence of the source modification. provisions If above the three discussed single purposes of this
were combined into statute might case, it read as follows:
(1) The court or shall determine the amounts [Wis. incurred. expense payments previously of medical 655.009(2)] Stat.
(2) any compensation [for Evidence of expenses] received from sources other than defen- [determining] damages. [Wis. admissible in dant 893.55(7)] Stat.
(3) Every the sum specify award of shah money, any, if awarded for each element of medical 893.55(5)] expenses. [Wis.
(4) not limit the This section does substantive *55 rights procedural persons who have claims based on 893.55(7)] subrogation. § [Wis. Stat. principles applied in
Each of the stated above must be statutory comply medical cases to with directives.
HHhH majority opinion acknowledges ¶ 142. The Majority the collateral source rule has been modified. op., jumps ¶ 48. But it to the conclusion that "the modification of the collateral source rule is a modifica- tion of the rules of evidence to allow evidence of the payments; explicit other the modification not an is modification of the substantive collateral source rule payment that a collateral source does not reduce an expenses." opinion goes award of medical Id. The on to hold that "the circuit court must instruct the fact-finder it that must not reduce the reasonable value of medical payments."
services on the basis of the collateral source Id., ¶¶ 5, 74. startling
¶ 143. These conclusions render Wis. nullity. they appear Moreover, to lock in an inflated services, value of medical even when some already by or all of these services have been absorbed proposition completely the tortfeasor. The latter contrary to conventional views of the collateral source rule. majority's are mistaken conclusions premises, derived from exami- on a series of false
built (B) (A) legislative statute; the text of the nation of history (C) alleged legislative goal statute; 893.55(7), concepts adopting and three of law Wis. Stat. (D) namely, allegedly statute, in the "embodied (E) services; collateral valuation of medical source (F) subrogation." Id., rule; and 26. It should be noted majority's methodology unprec- is an at once that the statutory departure interpreta- edented from orthodox tion. majority First, the text of examines 893.55(7), which reads:
Wis. Stat. injury any compensation bodily Evidence of for received compensate defendant from sources other than the injury for the is admissible an action to the claimant malpractice. This section recover rights of procedural not limit the substantive or does upon subrogation. persons who have claims based *56 (7) encompasses correctly all subsection It damages notes that and makes in a medical action in admissible evidence of all collateral source opinion regard damage Id., ¶ 28. The then to all claims. speaks compensation "Although asserts: the statute demonstrates that the claimant, to the the instant case payments, encompasses write-offs, also statute for- directly providers giveness rather made to health care added). (emphasis Id., ¶ This than to the claimant." sequitur. plainly a non circular assertion is may "Compensation" ¶ in this subsection contemplate of medical services the reasonable value by patient, not mean that the received but this does necessarily value of medical services is reasonable be pay highest payor measured what the would have to Ellsworth, for the same medical service. See 235 Wis. 2d (Sykes, dissenting). J., subsection, In this "compensation" statutory term, is a not a common law concept, in and it must be construed a manner consis- legislative purpose. tent with its context and Subsection (7) in was enacted the court's decisions Ellsworth before possible legislative square and objectives It is not Koffman. containing minimizing costs double recovery interpretation with the court's of the term "compensation," especially when we factor Wis. Stat. 655.009(2). majority opinion argues
¶ 147. The also that "the questions text of the statute raises more an- than it Majority op., designed contention, swers." open 35. This statutory interpretation, up the door to sums four paragraphs, majority poses ques- ¶¶ 32-35, in which the Posing questions tions that the statute does not address. that will be answered the circuit court or on a case-by-case nothing ploy basis is more than a to create ambiguity justify statutory in the statute to construc- tion. majority legislative Second, looks at
history early Assembly and notes that an draft of 1995 Bill 36 contained the sentence: "The award of by any compensation under ch. 655 shall be reduced injured party received from sources other than the compensate injury." defendant him or her for the Majority op., ¶ 38. This sentence is deleted from the final draft. Assembly Legislative
¶ 149. 1995 Bill 36 had a Reference Bureau number of LRB This means 1913/3. that the bill introduced was the third draft of the 1913th requested. bill The deleted sentence was found
70 the authors by removed bill, and it was draft of the first draft was introduced before the third in the draft second as the bill. explanation reasonable perfectly There is draft. The from the first the sentence
for deletion of to weigh juries opted permit authors of bill reduce awards damage whether to and then decide facts pay- collateral source the amount of all or of part The revised in Delaware.2 is the ments, practice which any or a reduction of an offset "does not require draft other any pay- the amount award other to take juries evidence] allow[s] [The ments. . .. amount in determining account into compensation As- Engrossed Amendment Proposed of an award." Other Evidence Admissibility Bill 36: sembly Bill Records, Assembly 1995 Drafting Compensation, (2003). Delaware 18, § Ann. tit. Del. Code See Study: Enterprise Reporters' in 2 The A.L.I. was cited statute Legal Injury, Approaches For Personal Responsibility by the (1991), cited very document Change Institutional Bill 36. Engrossed analysis of 1995 its Legislative Council to Wis. strikingly similar Statute The Delaware 893.55(7). provides: § 6862 Ann. tit. Delaware Code damages property any negligence because action for therefrom, resulting injury, including damage bodily death or introduced, introduced, shall may the trier of facts and if be there (1) any public Any as to and all facts available of: consider evidence person payable compensation or benefits source of collateral probably (including be seeking all sums which will such future) of such person on account paid payable in the to such bodily injury damage .... property or understanding that difficulty no courts had The Delaware of a loss the collection prevent is to of this statute purpose "The (such Security) Social as public source from a collateral hospital party from the the same loss collection for then the Uhde, A.2d Inc. v. Hosp., Memorial Nanticoke being sued." 1985). (Del. 1071, 1075 *58 (available
36 at the Wisconsin Reference Legislative Wisconsin) added). Bureau, Madison, (emphasis This flexibility juries anticipates balancing in equities widely varying situations, fact and into account taking special circumstances like Medicare reimbursement. 151. The Delaware approach, followed by Wis. 893.55(7), has also in been such other adopted Alabama,3 Arizona,4 states as and California.5 3 (2001). Green, §12-21-45 Ala. Code See Marsh v. 782 (Ala. 2000). So.2d 223 (2005); Ariz. Rev. Stat. 12-565 see also Eastin v. Broom (Ariz. 1977) field, 744, 570 E2d 752-53 (disagreed with on other (Ariz. grounds by 2004)). Donahoe, 1045, Shotwell v. 85 P.3d (2005). §3333.1 Cal. Civ. Code California Civil Code (2005) § 3333.1 provides part: personal injury against [T]he defendant... in an action for a health provider upon professional negligence care may based ... introduce any payable plaintiff evidence of amount as a benefit to the as a personal injury pursuant result of the to the United States Social Security Act, any disability state or federal income or worker's compensation act, any health, income-disability sickness or insur- ance, provides accident insurance that health benefits or income- disability coverage, any agreement any group, contract or organization, partnership, corporation provide, pay for, or medical, hospital, dental,
reimburse the cost of or other health care services.... The California Supreme Court has determined that "the Legislature's [California] assumption was the trier of fact plaintiffs would take the receipt of such benefits into account by reducing damages," and that the statute is constitutional. Wood, (1984). Barme v. 37 Cal. 3d 179-82 Both the Barme court and later appellate California panels were careful to note although original draft of the California statute re- quired the trier of fact to reduce the plaintiffs damages, the enacted statute "simply provides for the admission of evidence benefits, of such apparently leaving to the trier of fact the decision as to how such evidence should affect the assessment of attempts majority opinion link the of the bill from the first draft the sentence deletion of by legislative amend- of a sentence later addition and the explained by memorandum The latter can be ment. January Legislative 20, 1995, files. On Council
the representatives Employers faxed a Health Insurance Sheryl Representative Albers, who was memorandum Assembly Insurance, on Committee Chair of the then Policy. Corporate read The memorandum Securities *59 part: counsel, and staff we the author After discussions with our again and consulted with language the reviewed pose does not language itself attorneys. Although those rule and the collateral source since problem independently, function subrogation rights have who interpreta- future concerns about to have we continue the "made application a creative tions based on doctrine. whole" January in Bill File for 20, 1995,
Memorandum dated (available Legisla- Assembly Bill at Wisconsin Wisconsin). Council, Madison, tive Employers memorandum then Health The adding:
proposed limit the sub- does not "This section rights persons procedural who have stantive precisely subrogation." upon Id. This is claims based language short, amendment. a Senate later added history legislative does of Wis. Stat. of one sentence link the deletion between establish another. addition of and the legislative majority complains admissibility
history not make clear how does "impacts plaintiff payments our to a source collateral Hosp. n.5; v. see also Hernandez damages." Id. at 179 California 2000). (Ct. Ctr., App. Rptr. 2d Med. 93 Cal. defining case law 'reasonable value of medical services' as the reasonable value of medical rendered, services with- paid, out limitation to amounts or how that modification subrogation." affects the collateral source rule and Ma- jority op., ¶ permits 47.1 believe it does. The statute jury payments to consider collateral source in a medical (7) determining damages. case Subsection preserves procedural rights per- the substantive and subrogation. rights sons who have claims based on Those are established outside the statute. Persons who have subrogation claims based on or reimbursement must appropriate appro- assert their claims at an time in an priate manner, neither of which is limited subsection (7). required respond way The court is then in a accurately protects subroga- both informs rights. tion majority legislature 155. The declares that the
was "well Report- aware" of the American Law Institute Study recommending "mandatory ers' reduction of a plaintiffs 'by present tort award the amount of estimated future from all sources of collateral *60 except Majority op., benefits ¶ fife insurance.'" 44. It legislature "deliberately adopt states that the did not the Study's proposed approach." Report- Id. The is, truth the Study "virtually complete ers' recommended reversal of the approach collateral source rule wherever such an is any feasible," in subrogation tandem with "a bar to rights by against reimbursement exercised loss insurers Reporters' the Study: tort award." The A.L.I. Enter- prise Responsibility Injury, Approaches Personal for Legal (1991). Change and Institutional at 182 The adopted American Reporters' Law Institute never the Study, obviously legislature and steps pre- the took subrogation rights. serve legislative majority up
¶ Third, takes 156. "legislative goals goals are and declares Majority op., explicitly ¶ 49. forth the statute." set Legislative goals surprise. are often not is not a This job a A is to of statute. court's discern stated the text goals possible, legislative if and sources, from intrinsic necessary. v. sources, if State ex rel. Kalal extrinsic County, ¶¶ 58, 44-51, Court Dane 2004 WI Circuit 2d 633, 271 Wis. 681 N.W.2d accurately majority
¶ two of the 157. The states (1) namely, provide legislature's goals, fact-finders payments in collateral information about the source with recovery; hope patients not obtain double will (2) providers' ultimately, health care insur- to reduce goal premiums. not stated ance obvious juries compensation majority is to take other to allow damage determining the amount into account in acknowledged though goal not even it is awards. This majority legislative history. explicitly in the See stated op., ¶ 42 n.16. having least some of the Fourth, stated at majority
legislative goals, sets to undermine out begins a of "the valuation It with discussion them. expenses." Majority op., ¶¶ 50-51. reasonable medical calculating damages, person majority "In The injured writes: malpractice may recover reason- medical reasonably required by value of the services able 243). injury." (citing Thoreson, 2d Id., Wis. at problems are with this 159. There two serious pre- predates Chapter First, Thoreson statement. 893.55(5), predates Wis. Stat. dates Wis. Stat. 893.55(7). malprac- Second, is not a medical Thoreson above, the statement Hence, case. to make tice majority statutes, to determine that three focused has including majority admits modifies that the statute *61 no on the have effect sub- rule, the collateral source respect stance of the collateral source rule with to expenses malpractice in a medical case. majority ¶ 160. The dismisses Wis. Stat. 655.009(2), saying change long- it does not "the standing rule that the 'reasonable value of medical of services' is reasonable value medical services paid." Majority rendered, without limitation to amounts op., majority point ¶ 54. is not correct. The This does any authority to substantiate its conclusion that the relationship reasonable of value medical services has no payments to actual where actual have been malpractice Clearly, made the medical context. Ellsworth and have not been the for the law Koffman they applied decades, last three nor have been in this manner in medical cases Contrary majority opinion, ¶ 161. there is damages past substantial evidence that for medical and hospital expenses tightly have been controlled over the years by judges, keeping Wisconsin with ("the expense payments previously of amounts medical incurred"). ("Personal instance, For Wis JI —Civil 1750A Injury: Question One Subdivided toas Past and Future (1990)) Damages" instructs as to "Past Medical and Hospital Expenses" in Subdivision 1:
Question_inquires money as to of what sum will fairly reasonably compensate plaintiff and for the sustained him from the date of accident trial, the date accident, which were the result such with respect to medical hospital expenses. and your you answer to will question_, upon fix money you such sum reasonably as has been find necessarily plaintiff incurred hospital required medical care for the treatment of his personal injuries. may This amount not be limited to doctor hospital bills and plaintiff bills. The entitled recover, part expenses, as a these an such amount as *62 transporta- him costs reasonably compensate will for service, tion, including his home ambulance from and also such places treatment and return for him reasonably paid or incurred amounts as were for drugs nursing and and medications. services added). (emphasis 1750A Wis JI —Civil in instruction, which was use 162. This old years decision, after the Thoreson cross- more than 20 ("Personal Injury: 1765 referenced former Wis JI —Civil (1990)). Expenses" Hospital The and com Past Medical post-Thoreson cites two to the latter instruction ment Rosenow, 463, 63 2d 217 N.W.2d388 Green v. Wis. cases: (1974), Persons, 2d Fouse v. 80 Wis. N.W.2d and (1977). Green, court said: 'Where a bill In having nothing may separate one maladies, relate to two plaintiff prove plaintiffs claim, must do with the injury charges caused the defen relate to the which added). (emphasis at Green, 63 2d dant." Wis. hospital supported ex Fouse, medical and the court penses and reasonable neces that doctors testified "were added). (emphasis sary." Fouse, 2d at 396-97 80 Wis. notwithstanding words, the Thore- In other has of medical services decision, the reasonable value son consistently highest reason- measured as not been particularly services, in medical those cost for able "highest approach value" cases. programs phenomenon. health such recent Government only not the Assistance are Medicare Medical as payors now medical services at care who secure health may the norm. Indeed, be discount. discounted 655.009(2) Wis. 164. Even if Wis. Stat. 893.55(7) requiring interpreted were to be as services, this does of medical full, undiscounted value negate modification of the collateral admitted malpractice cases. in for medical rule source majority's ¶ 165. The discussion of the collateral unpersuasive ¶¶ in source rule 56-63 is an denial of the legislature modify fact that the has acted to the rule. policy instance, For the discussion of the basis for the point, ¶¶ collateral source rule 57-58 is beside legislature policy inasmuch as the objective had a different containing liability mind: costs of providers by discouraging recovery. health care double *63 may ¶ A 166. medical case be factu- ally person different from other To if illustrate, cases. physician, physician from receives treatment will bill services, someone for if even those services were negligent. physician pay- If the receives discounted ment, then this "tortfeasor" will absorb the difference payment between the so-called "full" value and the actually made. If a is "tortfeasor" held accountable for required the full value of medical services and is to party, reimburse actual received from a third liability partial then there will be double as well as recovery. majority authority double The cannot show for proposition liability that double is a for tortfeasors component the collateral source rule. brings subrogation. Subrogation ¶ 167. This us to party has been defined as "substitution of one party entitling pays, paying another whose debt the party rights, remedies, or securities that would belong Gassner, otherwise debtor."Ruckel v. 2002 (quoting ¶ 14, WI 67, 253 2d 280, Wis. 646 11 N.W.2d (7th 1999)). Dictionary Subroga Law Black's 1440 ed. rights tion are often in contracts, embodied such as policies. subrogation protected insurance Sometimes operation statute or from derived law. Wiscon private subrogation agreements ordinarily sin, are sub ject (citing Id., ¶ to the made whole doctrine. 16
78 Garrity Co., 541, 537, 2d 253 v. Rural Mut. Ins. 77 Wis. (1977)). legislatively However, sanctioned N.W.2d may subrogation Id., the made whole doctrine. override omitted). (citations ¶ 42 n.7 multiple ways
¶ to handle subro- There are 168. gation in Jin these enumerated claims. Some of were Flooring, 595-97, 2d v. Wis. dra Diederich (1994). 893.55(7) does not Wisconsin Stat. N.W.2d catalog possibilities attempt or to determine all the procedure in each situation. to be followed "[a]ny interpreta- majority writes that 169. 893.55(7) take into account tion of must... rights of claims based on does not limit the
statute subrogation." Majority op., dispute. This is not in however, follow, does not that "Wis.Stat. It juries require interpreted to instruct courts must be pay- to consider the collateral source to be instructed determining only the reasonable value ments Id., ¶ 72. Such an instruc- rendered." services absolutely ignores no in which there is situations tion subrogation right or reimbursement. relationships many be- There are different *64 providers. patients Four broad health care
tween may patients categories be First, to the come mind. government program a such as Medicare beneficiaries pays most all of their Assistance that or or Medical may patients be direct beneficia- Second, medical bills. private private self-insurance, insurance, ries health coverage pays privately all or funded that or some other may patients pay Third, their of their medical bills. most family paid a them friend medical bills or have own coverage patients Fourth, with no health care member. may gratuitously providers. from This receive services categorization exhaus- illustrative, to not is intended be majority's problems with the tive, and to show the holding. Hospital,
¶ 171. The recent case Meriter Inc. v. County, 145, 1, Dane 2004 WI 2dWis. 689 N.W.2d teaching Meriter, can be used as the tool. In jail prisoner County the at Dane to was admitted the hospital. charges against prisoner Criminal the were dropped day prisoner's the on third extended hospitalization, parole Id., after his hold had been lifted. interpreting ¶ concluded, 1. This court statute, after county obligated pay the was not for the prisoner's 34-day stay. hospital up entire ended eating most of the extensive cost. According
¶ 172. decision, the the total cost of prisoner's the ing care and Meriter, treatment at not includ- pay security provided,
the overtime for the amounted figure $187,569.37. Id., 5. This was based on a Diagnostic calculation method known as the Group Related (DRG) By government Id., ¶ contrast, rate. 9. the payment only rate for $74,847.92. the services was County only paid fact, $4,463.26. Id., ¶ Dane 8. The difference between the last $70,384.66. two amounts was Suppose, hypothetically, hospital's that the prisoner treatment of the had excellent, not been injured prisoner medical had on the day county stopped paying. fourth after the Would the hospital any liability expenses have for medical to the prisoner-plaintiff? so, If how much? Under traditional theory, hospital collateral source there should be no liability expenses at all because there is no only Unfortunately, collateral this source, the tortfeasor. clearly signaled by majority opinion. result is Changing hypothetical, suppose county paid hospital $70,384.66. extra Would the prisoner expenses $70,384.66 be entitled medical (less hospital, $187,569.37 from or even the DRG malpractice)? rate incurred before The difference
80 applicable payment and the $70,384.66 the between hospital the have absorbed rate would been DRG implies already, majority opinion differ- that this but subject payment to a as actual would be ence as well hospital damage plaintiff. had to If the award to the keep county, plaintiff repay able to would the be damages, expense or in would $70,384.66 medical required plaintiff $70,384.66, over less to turn be county?6 collection, to the cost opinion majority ¶ 73 asserts that many questions unan- leaves Stat.
Wis. parties' ability to evidence introduce swered, such as "the argue obligation repay collateral sources." about the my majority opinion muddles the view, it is the why a I can fathom no reason confusion. law and creates any permitted jury evidence or to receive should not be argument any source on collateral hear help of medical make a reasonable determination will malpractice it subroga-
damages, taking into account after anything rights and reimbursement tion and/or payments. plaintiff Under Wis. earn the contributed 893.55(7), permitted not to must be recovery plaintiff in a to the double award malpractice case.
IV presents circum- case at hand unusual 176. The which are outlined circumstances, These stances. opinion, majority addressed must be
¶¶ 9-14 of the particularity. with Lagerstrom, H. was deceased, Vance 177. The hip years on Novem- old when he fell and broke his
87 Plan, Found. Health See Karsten v. Kaiser Supp. F. (E.D. 1992). Va. *66 Lagerstrom Myrtle 24, ber 2000. Mr. was admitted to Hospital, hip replacement Werth where he underwent surgery eventually developed lung congestion and any malpractice fever. There is no evidence of at the hospital Consequently, until December 2000. Mr. Lagerstrom's providers health care were entitled to re- payment every day up ceive from for Medicare of service malpractice. days. to the time of This was about seven feeding ¶ 178. The the mistake with tube occurred Assuming deciding on December 2. without are defendants liable for all medical costs after the (A) malpractice, the fact-finder would to determine: have post-malpractice payments the actual from Medicare to (B) Myrtle Hospital; Werth the "reasonable value" of the post-malpractice Myrtle medical services of Werth Hos- (C) pital; payments the actual Medicare to Luther Hos- (D) pital; reasonable value the medical services of (E) Hospital; payments Luther the actual Medicare to (F) Nursing Lakeside Home; the reasonable value (G) Nursing medical services of Lakeside Home; the (H) payments Joseph's Hospital; actual Medicare to St. the reasonable value the medical services of St. (I) Joseph's Hospital; payments the actual Medicare to any provider malpractice; other health care after (J) post-malpractice the reasonable value of these other Against background, expense services. this medical dam- ages be should treated as follows: plaintiff First, is not entitled to recover damages expense any from defendants provided Myrtle value of medical services Werth Hospital that exceeds the actual Medicare Myrtle any damages only Werth because such would not recovery plaintiff be double for the but also double liability liability for the Such tortfeasor-defendants. simply part not of the collateral source rule. permitted jury were Second, if of medical services full reasonable value
consider the Nursing provided by Hospital, Home, Lakeside Luther any post-malpractice Joseph's Hospital, and other St. provider jury Hospital), (except Myrtle must Werth damages given authority or not award be award exceeding pay- actual Medicare for the "value" disregard should be instructed to ments. *67 payments by Mr. actual costs to Medicare or actual Lagerstrom determining of for the award jury fully past expenses. informed be medical The should including facts about reimbursement. facts, amounts Third, 181. Medicare reimbursement by in the the court and inserted should be determined argues Lagerstrom special that Medicare verdict. Mrs. rights statutory under U.S.C. has reimbursement (2000), pt. § 1395y(b) 411. She at C.F.R. codified (2004) quotes "If to the effect that: C.F.R. 411.24 party beneficiary party a third receives or other beneficiary payment, reimburse Medicare must Academy days." Trial of Law- The Wisconsin within 60 yers argues that: amicus brief its statutory granted government expressly is
The federal may government seek reimbursement.... rights of all against any amounts rights to exercise these by jury. designation recovered, regardless of their award or eliminates an if a reduces Consequently, Medicare, plaintiffs face expenses paid for medical This of "double loss." very real likelihood a right recovery may assert its Medicare because entirety of the award.... against the representations accurate, Medi- are 182. these If right against the its of reimbursement
care could assert plaintiffs costs, medical the deceased's actual award for suffering, pain award for and the for award wrongful death.
¶ a Such draconian result would not occur private with a insurer because the made whole doc- appears But trine. there to be basis for such conclu- Regulations, though sion in the Code Federal even July 30, 2001, communication from the Health Care Financing Lagerstrom's attorney Administration to Mrs. "overpayment." demands reimbursement for di- This why lemma illuminates Medicare been should have joined plaintiff litigation, just aas in this as the Dunn County Department joined of Human Services was as a plaintiff any in Ellsworth. In event, Medicare could not Lagerstrom repay judgment force more than the 411.37(d) ("if (2004) amount. See 42 C.F.R. Medicare payments equal judgment or exceed the or settlement recovery [Medicare's] judg- amount, amount is the total payment procure- ment or settlement minus the total costs"). ment my upon view, remand, the circuit court precise money award
should Medicare the amount it paid post-malpractice plus services, inter- proportionate est, minus a share of the cost incurred *68 Lagerstrom securing Mrs. in this reimbursement protect damages amount. This all would awarded to Lagerstrom enlarge against Mrs. the and award which plaintiff attorney permitting the fees are calculated, a significant from deduction Medicare's reimbursement.
V gave jury ¶ following 185. The court the the in- struction: Medical, Recovery
Estate's Hospital, and Funeral Expenses (b) of question
Subdivision 4 asks what sum of money fairly reasonably will and compensate the Es- of Lagerstrom tate Vance for the reasonable value of necessarily hospital expenses the of care of him from date reasonably incurred death, time of his incident to the the Ensure infusion a of injuries resulting to him as result because the Ensure incident. one, you such this negligence cases as
In medical regarding testimony hear are allowed Medicare, and other sources. by made insurance by the sum found require you reduce law does value of the medical services you to be reasonable of the defendants was cause negligence which may by any such You do so. any made source. payment jury you It is for to decide. majority
¶ contends that the instruction 186. The not alert the infirm it does because obligated potentially Medicare. to reimburse estate is Majority op., ¶ 82. may legitimate
¶ because of This criticism be 187. statutory plaintiffs potential claim on Medicare's deficiency damages. corrected can be But the other remanding court for an award the case the circuit damages, ¶¶ outlined above as Medicare's new trial on the is no need to order a 188. There ordering hospital expenses. Indeed, and medical issue prejudicial alone is unfair and new trial on Employers v. Mut. Liab. Ins. (1953). Leonard the defendants. See jury A Co., 464, 470, 62 N.W.2d 265 Wis. facts and evaluate hear all the be able to should expenses plaintiffs in the context for medical demand case. the whole respectfully above, I stated 189. For the reasons
dissent. state that Justice JON I am authorized to joins opinion. this
E WILCOX