Baldwin Haspel Burke & Mayer LLC

Maritime Update: La. Supreme Court Rules Collateral Source Rule Does Not Apply to Medical Expenses Charged Above the Amount

Bill Schwartz - 

In the case of Simmons v. Cornerstone Investments, LLC decided by the Louisiana Supreme Court on May 8, 2019, they held that in a tort case against a third party tortfeasor, the collateral source rule did not apply to medical expenses charged above the amount actually incurred. They upheld the decision by the trial judge to properly exclude such expenses from the jury’s consideration.

By way of background, in this case the medical bills charged by the health care provider totaled $24,435. This amount was reduced to $18,435 under the Workers’ Compensation Act Medical Reimbursement Schedule. Thus, $6,000 in medical expenses was written off. The Court stated that the collateral source rule “is tethered to payments actually received by the plaintiff.” The Court noted that “receipt” is interpreted as including payments made on behalf of the plaintiff. The Court termed the written off amount a “phantom charge” that would never be paid by plaintiff because he was not obligated to pay it. Accordingly, plaintiff’s patrimony was not diminished because he did not incur the fictional expenses. The Court said there was no basis to differentiate the written off expense pursuant to Workers’ Compensation from expenses written off pursuant to a Medicaid program, as they decided in their prior ruling in Bozeman v. State, 03-1016 (La. 7/2/04), 879 So. 2d 692, or as they ruled regarding an attorney-negotiated discount in Hoffman v. 21st Century North American Ins. Co., 14-2279 (La. 10/2/15), 209 So. 3d 702.

This Simmons majority opinion was authored by Justice Clark. Justice Hughes concurred with reasons and Justice Genovese dissented with reasons.

Click here to view the entire case.

If you have any questions regarding this maritime matter, please contact Bill Schwartz at (504) 569-2900 or wschwartz@bhbmlaw.com.


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