A woman fell at a business premises. Subsequently, she died. In the period between the fall and the woman's death, the woman's medical providers billed $197,154.93 for her care. The woman was covered by Medicare and had supplemental coverage through a private insurer. Medicare and the private insurer together paid a total of $70,711.26 to the woman's medical providers.
The woman’s estate brought a wrongful death action against the business. The parties agreed that the estate was entitled to damages representing the reasonable value of the medical expenses for medical services obtained by the woman. The business filed a pre-trial motion seeking to limit the estate's medical expense recovery to the amounts paid to the medical providers by Medicare and the private insurer, and to prevent the estate from presenting evidence to the jury as to the amounts actually billed by the medical providers.
The Montana Eighth Judicial District Court, Cascade County, granted the motion and granted summary judgment limiting the estate's medical expense recovery to the amounts paid to the medical providers by Medicare and the private insurer. The trial court reasoned that since the estate had no liability exposure to the medical care providers in excess of the amount paid by Medicare and the private insurer, the only medical expense evidence that the estate could present to the jury were the amounts that had been paid to the providers. The trial court concluded that the amount actually billed by the providers was not representative of the reasonable value of the medical services provided to the woman and that the amount billed by the health care providers was inadmissible because it was irrelevant to any issue or to damages in the case.
The estate petitioned the Supreme Court of Montana for a Writ of Supervisory Control. Supervisory control is appropriate when the district court proceeds upon a mistake of law which, if not corrected, would cause significant injustice for which appeal is an inadequate remedy.
The Supreme Court of Montana granted the petition and exercised supervisory control. The court held that exclusion of evidence of the amounts actually billed by providers, and admission of only evidence of amounts paid to providers, violated the collateral source statute; and an issue of material fact regarding whether the medical bills were a reasonable a measure of damages in a tort action precluded summary judgment.
Exclusion of evidence of the amounts actually billed by providers, and admission of only evidence of amounts paid to providers, violated the collateral source statute. Montana’s collateral source statute, MCA § 27–1–308, requires that a jury determine its award without consideration of any collateral source. A collateral source was a payment for something that was later included in a tort award and that was made to or for the benefit of a plaintiff or was otherwise available to the plaintiff. The collateral source statute provided that in a separate post-trial proceeding the district court must reduce a jury's verdict in a personal injury case by any amount paid or payable from a collateral source that does not have a subrogation right. The court found that payments made by Medicare and the private insurer to satisfy the woman’s medical providers’ billings were a collateral source. The court concluded that the trial court's grant of the business’s pre-trial motion to exclude evidence of the amounts actually billed by providers, and to admit only evidence of the amounts Medicare and the private insurer paid to providers, violated the collateral source statute. The court explained that, after a jury verdict in favor of the plaintiff, the district court must hold a hearing and determine whether there were any collateral source payments to account for. If so, the recovery must be reduced by the amount paid or payable from a collateral source.
An issue of material fact regarding whether the medical bills were a reasonable measure of damages in the tort action precluded summary judgment. The reasonableness of the medical bills as a measure of damages in the tort action was a matter to be determined by the jury. The court determined that there was a factual dispute in the case over the nature of the bills presented by the medical providers and whether they represented a reasonable measure of the value of the services provided. The court reasoned that the medical bills received by a tort victim could be relevant evidence of issues such as the nature and severity of the injuries and of the medical procedures and treatments that were required. In response to the business’s motion for summary judgment, the estate presented the affidavit of the decedent’s primary physician that affirmed that the medical services represented in the billings were reasonably necessary to the decedent’s care. The affidavit also affirmed that the amounts billed were reasonable, were the usual and customary rates for such treatment, and that they represented the reasonable value of the treatment. The court explained that, if at trial the estate introduced evidence of the woman's medical bills, the business may contest the reasonableness of those bills as a measure of damages. If the business contests the reasonableness of the bills as a measure of damages, evidence of the amount that Medicare paid to other health care providers for the same or similar service could be relevant to that issue, as long as there was no evidence or argument that the woman was covered by Medicare or other insurance, or that Medicare or an insurer paid any part of her medical expenses. The court noted that those matters may be considered only by the district court and only after a verdict.
The Supreme Court of Montana granted the petition and exercised supervisory control, functionally reversing the trial court’s grant of the business’s motion to exclude evidence of the woman’s medical bills and grant of partial summary judgment in favor of the business.
See: Meek v. Montana Eighth Judicial Dist. Court, 2015 WL 2242419, 2015 MT 130 (Mont., May 13, 2015) (not designated for publication).
See also Medical Law Perspectives, November 2012 Report: Liability for Electronic and Other Medical Record Information Disclosure
See the Medical Law Perspectives May 6, 2015, Blog: Hospital Incident Reports Under Scrutiny Again; In Camera Review Found Necessary To Determine Discoverability
See the Medical Law Perspectives March 2, 2015, Blog: Discovery of Hospital Incident Reports: Prepare for In Camera Review; Discovery Likely