Collateral Source Rule Not Applicable to Medical Expense Recovery
Collateral Source Rule Not Applicable to Medical Expense Recovery
By: John Yadamec
Thibodeaux v. Wellmate, No. 12-1375, 2016 U.S. Dist. LEXIS 67407, 2016 WL 3144374 (E.D. La. June 6, 2016)
Judge Susie Morgan of the U.S. District Court for the Eastern District of Louisiana ruled that under the collateral source rule, an injured employee covered under the Longshore Act pursuant to OCSLA may not recover the total amount billed by his medical providers from a third party tortfeasor. Recovery is limited to the amount actually paid by the employer to the medical providers because the injured worker did not suffer a patrimonial loss to obtain the benefit of the medical payments on his behalf, and because granting him recovery would create a windfall or double recovery. However, the court did allow the worker to enter evidence of the full amount billed for medical services because it had possible probative value for the trier of fact to consider.Thibodeaux was injured while working on an offshore platform owned and operated by Chevron when the bladder in a water tank ruptured. Chevron paid his medical bills as his employer under the LHWCA as adopted by reference in OCSLA. The total amount billed for the services was $626,529.68; however, the medical providers agreed to write off most of the amount billed, leaving Chevron to pay only $244,702.87. Thibodeaux claimed that the collateral source rule should apply, and that he should be able to recover the full amount billed. Pentair, the water tank manufacturer and defendant, filed a motion in limine to (1) limit Thibodeaux’s recovery to the lower amount, and (2) to exclude evidence of the total amount billed.The court agreed with Pentair’s contention that the collateral source rule was inapplicable to Thibodeaux’s medical bills. The decision cited to several Louisiana state court cases that held there are articulated two criteria for determining when the rule should apply: (1) whether applying the rule will deter future tortious conduct, and (2) whether the victim paid for the benefit provided by the collateral source, or suffered a patrimonial loss because of the benefit’s availability. The court also cited to three Louisiana state court cases as examples: Bozeman v. State (denied recovery of Medicaid write-off amounts), Bellard v. American Cent. Insurance Co. (allowed credit to uninsured motorist insurance carrier for employer’s payment of disability wages and medical bills), and Hoffman v. 21st Century North America Insurance Co. (denied recovery of write-off amounts negotiated by the plaintiff’s attorney). Next, the court recognized that the Fifth Circuit embraced the same rule in Miciotto v. United States.Applying those cases to the facts, the court held that Thibodeaux suffered no diminution of patrimony, nor had he given any consideration or payment for the benefit; therefore, the collateral source rule was inapplicable. However, the court did allow Thibodeaux to enter the write-off amounts into evidence because “the total amount of medical expenses billed has some probative value that is not substantially outweighed by any risk of unfair prejudice.” Thus, the court granted Pentair’s motion in limine as to the inapplicability of the collateral source rule, but denied the motion excluding evidence of the total amount billed by the medical providers.
