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The Alabama Court of Civil Appeal's Decision in Crocker v. Grammar;
How it will effect future personal injury litigation

 

The Alabama Court of Civil Appeals recently released a decision addressing the interplay between Alabama's Collateral Source Statute, which provides in pertinent part

"(a) In all civil actions where damages for any medical or hospital expenses are claimed and are legally recoverable for personal injury or death, evidence that the plaintiff's medical or hospital expenses have been or will be paid or reimbursed shall be admissible as competent evidence. In such actions upon admission or evidence respecting reimbursement or payment of medical or hospital expenses, the plaintiff shall be entitled to introduce evidence of the cost of obtaining reimbursement or payment of medical or hospital expenses" Ala. Code § 12-21-45 (1975),

and the Alabama Rules of Evidence, which became effective January 1, 1996 Elizabeth Crocker v. Jonathan Grammer Civil Action Number CV-08-903670. The Court had to address the interplay between this statute and the Alabama Rules of Evidence because of a decision rendered by a Jefferson County Judge regarding how medical bills should be treated in civil jury trials. Plaintiffs lawyers have long argued that the only amount relevant to a jury's determination of damages, from a medical expenses standpoint, should be the amount contained on the medical bills. They took this position despite the fact that the overwhelming majority of plaintiffs in this state have medical insurance and the amount actually paid to satisfy their medical bills is often far less than the amount contained on the bills. Anyone who is familiar with medical insurance is aware of the fact that physicians and hospitals routinely accept less than 50% of the amount contained on their medical bill in full satisfaction of any debt owed by the plaintiff. They do this pursuant to long term contracts with Blue Cross Blue Shield and other medical insurance providers, which require them to accept the reduced amount. Defense counsel have long argued that, pursuant to the Collateral Source Rule, a jury should be permitted to know that the medical bills introduced by the plaintiff were satisfied by the payment of a substantially reduced amount.

 

Approximately two years ago, a local Judge sided with the plaintiffs bar and entered an Order holding that the Alabama Rules of Evidence superseded, and abrogated, Alabama's Collateral Source Statute. Numerous other Judges in the state they adopted the Order. The result was that jury trial after jury trial went forward with the jury hearing only one number in relation to medical expenses; the inflated amount contained on the original bill to the plaintiff. Verdict after verdict was rendered without the jury ever knowing that the medical bills claimed by the plaintiff were satisfied for in many cases less than half the amount contained on the bills. Defense counsel argued that this was improper under Alabama Law and resulted in a windfall to the plaintiff.

 

In the Crocker case the Alabama Court of Civil Appeals provided at least some vindication for defense counsel and for civil defendants throughout this state. The Alabama Court of Civil Appeals ruled that the Alabama Rules of Evidence did not supersede Alabama's Collateral Source Statute and specifically held that a jury should get to consider the amount actually paid for the plaintiff's medical treatment when making its damage determination. The decision does not take the extra step that most defense lawyers believe is necessary and hold that the amount actually contained on the medical bills, which was never paid, and in reality, never owed, is irrelevant. Instead, the decision allows the jury to hear both the amount on the bills and amount actually paid for the treatment.

 

The next step is to get a case before the Supreme Court of this state wherein the defendants are able to make the second part of the argument discussed above. Specifically, the issue that now needs to be decided is whether or not the amount contained on medical bills received by the plaintiff is something that is relevant to a jury's determination. In most instances, and in every instance where a plaintiff has some form of medical insurance, physicians are forced to admit in deposition that the amount contained on their medical bills is not something that anyone owes. Instead, they testify that their various contracts with medical insurance providers require them to accept a lesser amount from the medical insurer. In exchange for this, the remaining amount of the bill is written off and uncollectible.

 

Under the Alabama Pattern Jury Instructions, medical expenses are those expenses which the plaintiff has "paid or become obligated to pay." A strict reading of that jury instruction would make a medical bill which contains an amount that has to be written off by contract irrelevant. The hope is that one day plaintiffs will only be able to claim the amount actually paid for their treatment. However, until that date comes, the Crocker decision assures that defense counsel throughout this state will at least be able to tell a jury the amount actually paid for the treatment received by the plaintiff.


Contributing Author:

J. Michael Bowling
J. Michael Bowling, Shareholder
Email Address mbowling@friedman-lawyers.com
Direct Line 205-278-7070
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