NEW ORLEANS (Legal Newsline) - A man who claims he was hit by a garbage truck and sued for medical costs that are twice what his hospital billed can actually collect, the Louisiana Supreme Court ruled, rejecting Progressive Insurance’s argument the plaintiff would never actually incur those costs.
Walter George was standing in front of his house in Houma in 2015 when he says a truck operated by Progressive Waste Solutions hit him with its hydraulic arm. George and his wife sued for damages, including medical charges from Champion Medical Center for $192,000.
A trial court refused to allow the medical bill into evidence because Champion had entered into an agreement with Ascendent Healthcare, a medical factoring company, under which Ascendant would collect any money from George’s lawsuit and give half of it to the hospital. George’s former lawyer, Marcus Spagnoletti, also signed a guarantee under which he agreed to turn over any proceeds from the lawsuit to Ascendant.
The plaintiffs appealed the trial court’s exclusion order to the Louisiana Supreme Court and it reversed in a Dec. 9 decision, citing the collateral source rule. That rule developed in the common law to insure defendants are punished to the full extent of their liability and plaintiffs don’t collect less simply because they had the foresight to buy insurance that covers some of the cost of their injuries.
In this case, Progressive argued the full amount of the hospital bill was irrelevant because of the 50% discount Champion agreed to take from Ascendant. The Supreme Court disagreed, however, saying there was no evidence in the record to show George was relieved of the obligation to pay the full amount. Absent that evidence, the jury could hear the entire amount regardless of what Champion actually could collect.
“The fundamental tort principle underlying all tort action in Louisiana applies here: if the defendants are found at fault, the plaintiff is entitled to be made whole through his recovery,” the court ruled. “Plaintiff is not entitled to receive more than his loss, nor should he be limited to less than his actual loss.”
The Louisiana Supreme Court limited the collateral source rule in cases where attorneys negotiate discounts because it raised “a variety of evidentiary and ethical dilemmas” including the fact a lawyer would be trying to recover a full “cost” knowing he had negotiated a lower price. But in this case, the court included, it applies.
Justice William J. Crain concurred, but said the court didn’t need to cite the collateral source rule at all since George was technically on the hook for the full $192,000 under Louisiana law.
“No discount has been negotiated for the plaintiff; thus, the collateral source is not implicated,” he said.