California Appellate Court Finds that Plaintiff in Car Accident Lawsuit Had Not Properly Proven Reasonable Value of Medical Services Provided, Remands Case for New Trial on Damages

Recently, the California Court of Appeal issued an opinion in a case regarding medical damages in a personal injury lawsuit arising from a car accident.  The appellate court reviewed legal precedent involving proof of damages for both insured and uninsured plaintiffs. The issue on appeal in this case was whether the lower court had properly ruled on the admissibility of evidence relevant to determining the reasonable value of medical services.

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The facts of this case showed that Catherine Margaret Cowan, a diabetic, lost consciousness due to low blood sugar while driving her car.  She collided head-on with Tara Frisk, who suffered injuries and underwent medical treatment.  This treatment included a disc replacement surgery, financed through Creative Legal Funding, the lienholder.  Ms. Frisk pursued medical damages against Ms. Cowan in order to compensate her for past and future medical expenses she incurred due to the collision. A jury found Ms. Cowan liable, awarding Ms. Frisk $3,695,879.59 in compensatory and punitive damages. These included $109,162.59 for past medical expenses and $1,084,457 for future medical expenses.

Ms. Cowan appealed the rulings issued by the trial court that allowed Ms. Frisk to present the amount that her medical providers charged to establish the reasonable value of past and future medical damages, while precluding Ms. Cowan from presenting evidence of the amount typically charged by medical providers for the same services Ms. Frisk received or anticipated. In other words, the court admitted evidence of the amount billed but did not allow evidence of the average amount that medical providers accept in order to determine the reasonable value of the medical services that were provided.

In their analysis, the California Court of Appeal stated the rule that trial courts are provided broad discretion regarding the admission and exclusion of evidence in ruling on motions in limine. The court stated that the measure for special damages is the reasonable value of medical services and care that is reasonably required and “attributable” to the tort.  When plaintiffs recover medical expenses, those costs must have been incurred and must have been reasonable.

The appellate court summarized relevant caselaw by holding that a plaintiff must prove medical damages that are limited to the lesser of either the amount incurred or the amount paid, and the reasonable value of the services.  The reasonable value of a service is the market value of that service.

The court stated that an insured plaintiff can show evidence of the amount accepted as payment by the medical providers to show the reasonable value of the services.  The amount billed is not relevant to show the reasonable value of the services provided.  An uninsured plaintiff can show medical bills, but they are not sufficient to prove the reasonable value. Uninsured plaintiffs must produce other evidence, such as expert opinion testimony, to show the amount billed is a reasonable value for the service provided.

Here, Ms. Cowan argued the trial court should not have admitted into evidence the amount charged as evidence of the reasonable value of medical services. The court stated that Ms. Frisk’s expert had not provided opinion evidence that the amount billed reflected the reasonable value of the services.  Instead, he stated they fell within a range of reasonable charges. The appellate court stated he did not tie the amount charged to the reasonable value of that service.

Next, the court stated that precedent requires determining the reasonable value of medical services through the market value, which is the amount that was sought and paid for the services.  The court stated that the lower court’s admission of this expert testimony was an error.

The court also agreed with Ms. Cowan’s contention that the trial court should have allowed evidence of the amount typically paid to medical providers for the services Ms. Frisk received.  They stated that when an uninsured plaintiff seeks medical damages, evidence of what is paid in the medical marketplace is relevant to understanding what is a reasonable value for those services.  Defendant tortfeasors must be allowed to present evidence that shows the amount billed is not the reasonable value of those services, and a lesser amount would reflect the market value.

The court remanded the matter for a retrial only on determining the amount of damages awarded to Ms. Frisk for past and future medical expenses.

The car accident attorneys at Sharifi Firm represent injured Southern California residents and can guide you through the process of organizing your evidence in support of your claim for damages.  Contact our office by calling (866) 422-7222 for a free, confidential consultation today.

More Blog Posts:

California Court of Appeals Allows Cross-Defendant to Recover Costs in Car Accident Lawsuit, Remands to Determine Reasonable and Necessary Costs, Southern California Injury Lawyer Blog, February 22, 2016

California Court of Appeal Holds Evidence of Industry Custom Relevant in Lawsuit for Compensation Following Car Accident, Southern California Injury Lawyer Blog, January 21, 2016

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