Calif. groups say bill is attempt to overturn SC decision

John O'Brien May 9, 2012, 10:00am


SACRAMENTO, Calif. (Legal Newsline) - Some groups are worried that a bill amended in the California Senate still seeks to overturn an August decision by the state Supreme Court that was a blow to plaintiffs attorneys.

As originally introduced, Senate Bill 1528 would have allowed an injured plaintiff to recover the entire cost of his or her medical care, not what was actually paid by an insurance company. Before the court's ruling, plaintiffs were eligible to be reimbursed for the retail rate of their care, not what was negotiated and actually paid for by an insurance company.

"We hold no such recovery is allowed, for the simple reason that the injured plaintiff did not suffer any economic loss in that amount," Justice Kathryn Werdegar wrote in August for a 6-1 majority in the case Howell v. Hamilton Meats.

The bill, which was discussed in a Judiciary Committee hearing on Tuesday, was introduced in February by President pro Tem Darrell Steinberg.

The original bill said it would "require, in order to ensure the public policy of all injured persons being compensated equally, than an injured person is entitled to recover the reasonable value of medical services provided without regard to the amount actually paid."

An amended version struck that portion and was replaced with, "This bill would express the intent of the Legislature to establish a framework for compensating persons with injuries due to the fault of third parties."

Several groups lined up to voice their opposition to the new bill, even in its new ambiguous state. Steinberg admitted that it is a "work in progress" and supporting testimony claimed the bill was aimed at clarifying the recovery process in the tort system.

"We don't normally get up and oppose spot bills, but I think it's quite clear that Howell is the issue," said Mike Belote, of the California Defense Counsel.

"We think the Howell case answered lots of questions and got them right. To that extent, this is modifying Howell and that's a problem. If the point of the bill is to modify Howell, then we're very concerned about that."

The Howell decision stemmed from Rebecca Howell's car accident with a driver for Hamilton Meats & Provisions.

SB 1528 is sponsored by the Consumer Attorneys of California. Past president Bruce Brusavich spoke on its behalf at the hearing.

Brusavich said counties that provide medical care are allowed to assert liens on potential judgments in personal injury lawsuits, but a 2001 decision said that liens can't be asserted against settlements. He added that the Howell decision "created even more confusion" and "left more open questions than answered questions."

"We need some clarity for all the stakeholders involved," he said.

Also testifying in support were two officials from Los Angeles County and San Diego County.

Katherine Pettibone, the legislative director for the Civil Justice Association of California, said a change is unnecessary.

"(The Howell decision) upheld long-standing notions of tort law," she said. "It upheld case law from back into the '80s. I don't see a problem. I think a framework to compensate plaintiffs already exists - a robust system here in California."

Three members of the committee voted for the bill, while two members were absent from the vote.

"The state of California as well as California's counties have a real potential stake in the success of this legislation and our being able to work something out," Steinberg said.

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