On August 18, 2011, the California Supreme Court issued their decision in the matter of Howell v. Hamilton Meats (2009) 179 Cal.App.4th 686, a hotly contested decision from the Fourth Appellate District of the Court of Appeal. In that case, the Court of Appeal had reversed the trial court’s granting of defendant’s post-trial motion to reduce the jury’s special verdict award for plaintiff’s past injury related medical expenses from the full amount of the medical bills to the amount that the providers accepted as payment in full from the plaintiff’s private health insurance company, a difference of $130,286. The Court of Appeal had reversed the order with directions for the court to reinstate the award of economic damages and to enter judgment accordingly holding that an order reducing the award for injury related medical expenses violated the collateral source rule. The Court of Appeal determined that in a case in which the plaintiff has private health care insurance, that the negotiated rate differential was a benefit within the meaning of the rule. The decision was appealed. Amicus briefs were filed on behalf of both parties.
The 6 to 1 decision of the California Supreme Court held that “....that an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more than the amounts paid by the plaintiff or his or her insurer for the medical services received or still owing at the time of the trial.” The decision of the court now prevents plaintiffs from recovering in damages any more than the actual harm that they suffered.
For defendants, this decision will have a favorable impact on both pending cases and, of course, new cases filed in the future. After years of uncertainty caused by conflicting appellate opinions, the Supreme Court has provided defense attorneys with a solid basis to reduce personal injury damage claims.