Daily Blast April 30, 2013

On April 30, 2013, the California Court of Appeal, Second Appellate District, Division Three (LA), issued an opinion in Corenbaum v. Lampkin and Carter v. Lampkin (April 30, 2013, B236227, B237871) ___ Cal.App.4th ___, holding that the full amounts billed for plaintiffs’ medical services is inadmissible and irrelevant to prove the amount of past medical expenses, future medical expenses and noneconomic damages. (Slip opn., pp. 19-23, 25-27.) This is the latest, and perhaps the most significant, case to interpret the California Supreme Court decision in Howell v. Hamilton Meats (2011) 52 Cal.4th 541 (Howell). The Corenbaum court answers a question left open by Howell about whether or not the amount billed for medical services can be considered in determining noneconomic damages—the answer is no.

This case arose out of injuries sustained by plaintiffs when defendant, driving his vehicle under the influence, collided with a taxi cab.  (Slip opn., p. 6.)  Plaintiffs sued  for negligence and gross negligence and sought punitive damages.  (Id. at p. 7.)   Before trial, plaintiffs filed a motion in limine to exclude any evidence of the payment of plaintiffs’ medical bills by a collateral source. (Ibid.) The trial court granted plaintiffs’ motion without prejudice. (Ibid.) The jury found in favor of plaintiffs and awarded $1.8 million and $1.4 million in compensatory damages and $20,000 in punitive damages each. (Id. at p. 9.) The trial court denied defendant’s post trial motion to “reduce the awards by the difference between the full amounts billed for past medical expenses and the amounts actually accepted by plaintiffs’ medical providers as full payment.”  (Id. at p. 10.)  Defendant appealed the judgment.  (Id. at 12.)        

The Court of Appeal, based on the opinion in Howell, determined it was error for the trial court to admit evidence of the full amounts billed when that was not the amount paid or accepted as full payment. (Slip opn., pp.17-18.)  The court reasoned that the “plaintiff’s pecuniary loss is limited to the amount paid or incurred for past medical services, so the plaintiff cannot recover damages in excess of that amount.” (Id. at p. 13.) Therefore, ”[e]vidence of the full amount billed . . . is not relevant to the amount of damages for past medical expenses if the plaintiff never incurred liability for that amount.” (Id. at pp. 17-18.) 
               
Recognizing that Howell did not address whether evidence of the full amount billed is relevant or admissible on the issue of noneconomic damages or future medical expenses, the Corenbaum court applied and extended the reasoning in Howell.  The Court of Appeal held that evidence of the full amount billed for past medical services is not relevant to the reasonable value of future medical services that the plaintiff is reasonably certain to require. (Slip opn., p. 22.) The court reasoned that because the price of a particular service can vary tremendously, “‘a medical provider’s billed price for particular services is not necessarily representative of either the cost of providing those services or their market value.’”  (Id. at p. 23.)  Further, it could cause confusion for a jury to consider both the amount billed and the amount accepted as full payment. (Ibid.)

Finally, the appellate court held that the evidence of the full amount billed is not relevant to the amount of noneconomic damages. (Slip opn., p. 25.) Pain and suffering damages encompass physical pain and various forms of mental anguish and emotional distress. (Ibid.) The determination of these damages by the trier of fact is subjective. (Ibid.) For this reason, there is no fixed amount to determine noneconomic damages, making the task for the trier of fact difficult. (Id. at pp. 25-26.) Lawyers have used the amount of economic damages as a point of reference for their argument to the jury to determine noneconomic damages. (Id. at p. 26.) However, this practice is “no justification for the admission of evidence that is otherwise inadmissible and that is not relevant to the amount of economic damages.” (Id. at pp. 26-27.) The Court of Appeal reversed the judgment for a new trial on compensatory damages. (Id. at pp. 27-28.)                   

Based on this new case, trial lawyers now have a basis to exclude evidence of medical bills not actually paid and limit plaintiffs to only the amount accepted as payment.  In discovery, counsel should ask for evidence showing the amounts actually paid and/or the amount accepted as payment in full. In addition, one of our astute Lewis Brisbois medical malpractice lawyers, Stephen Smith, suggests asking long term care planners in deposition for the basis of the figures for future care costs.  If the basis is what was billed rather than what was paid, that assumption should be improper and inadmissible. If future care cost estimates are based on calling various providers for rates, one should ask if the amount quoted was the “billing amount” or the amount that would be accepted from Medicare or private insurance.

Related Practices

• Appellate