The SCOTUS has decided the Sereboff v. Mid Atlantic Medical Services, Inc. case – the long awaited case that was to tell us about an ERISA plan’s right to seek reimbursement of medical payments from a tort recovery.
The Court held that the payments were recoverable.
The case was decided on May 15, 2006. The case number is 05-260.
The USSC has ruled that a state may not enforce its Medicaid lien out of money paid to the plaintiff for losses other than medical expenses. The case is Arkansas Department of Health and Human Services v. Ahlborn, No. 04-1506 (decided May 1, 2006).
Arkansas had a statute that permitted it to have its Medicaid subrogation interest paid out of a tort recovery by the plaintiff. Arkansas took the position that it was paid “off the top,” without regard to whether the money was paid for medical bills or some other compensable loss. That statute was held to be in violation of federal law.
The USSC addressed the issue of the parties potentially setting up an artifical allocation of settlement monies for medical expenses fopr the purposes of defeating Medicaid subrogation. The Court said “[e]ven in the absence of such a post-settlement agreement [about what portion of the settlement proceeds should be allocated to medical expenses], though, the risk that parties to a tort suit will allocate away the State’s interest can be avoided either by obtaining the State’s advance agreement to an allocation or, if necessary, by submitting the matter to a court for decision. For just as there are risks in underestimating the value of readily calculable damages in settlement negotiations, so also is there a countervailing concern that a rule of absolute priority might preclude settlement in a large number of cases, and be unfair to the recipient in others.”
The House of Representatives is trying to limit the right of tort victims again.
This time, the effort is to give even greater power to holders of ERISA subrogation interests.
The House has passed a pension bill (H.R. 2830) that included this language:
This is not a new opinion, but I came across it recently and thought it was worthy of mentioning here. It sets forth the elements that must be proved in a medical monitoring case under West Virginia law. The plaintiff must prove that:
“(1) he or she has been significantly exposed; (2) to a proven hazardous substance; (3) through the tortious conduct of the defendant; (4) as a proximate result of the exposure, plaintiff has suffered an increased risk of contracting a serious latent disease relative to the general population; (5) the increased risk of disease makes it reasonably necessary for the plaintiff to undergo periodic diagnostic medical examinations different from what would be prescribed in the absence of the exposure; and (6) monitoring procedures exist that make the early detection of a disease possible.”
Remember that the Sixth Circuit Court of Appeals recently held that Tennessee would recognize a cause of action of medical monitoring. Read my post about the case here.
A new opinion by the Western Section Court of Appeals in a personal injury case has me scratching my head.
The male plaintiff King was hurt in a car wreck. He claimed damages for loss of earning capacity. He was self-employed in the limestone business and his earnings history in the business was a real issue. The jury awarded $1,050,000 in damages on this element. The trial judge approved the award. The Court of Appeals reversed, saying that the amount was speculative.
Specifically, the Court said “King had no contracts for the sale of limestone. Additionally, King’s main customer bought from other sellers of limestone. Given the track record of King’s business and the uncertainty of sales of limestone, any showing of lost business profits would be speculative and not admissible to show lost earning capacity.” (Footnote omitted.)
The United State Supreme Court has agreed to hear a case concerning an ERISA plan’s legal right to sue a plan participant for reimbursement. As John Wood explains, “This important issue typically arises when an ERISA health plan pays medical bills for an injured participant. If the participant recovers from a third-party tortfeasor, the plan then seeks to recover its reimbursement interest from the participant.”
Read more about the issue and the case here at John’s erisaontheweb blog.
When you can’t prove a current injury but can prove that, because of the fault of another, you need to be regularly followed by a health care provider you seek damages for “medical monitoring.” The claim arises is toxic tort and products liability cases.
In a case of first impression, the Sixth Circuit Court of Appeals has ruled that Tennessee law would recognize a cause of action for medical monitoring. The court said “there is something to be said for disease prevention, as opposed to disease treatment. Waiting for a plaintiff to suffer physical injury before allowing any redress whatsoever is both overly harsh and economically inefficient.” (Emphasis supplied). The case, Sutton v. St. Jude Medical S.C., Inc., was brought as a class action on behalf of a proposed class of persons who underwent cardiac by[ass surgery using a medical device called the Symmetry Bypass System Connector.
Read more here.
Another state has ruled tht a plaintiff “may present to the jury the amount that her health care providers initially billed for services rendered” rather than the amount paid by the plaintiff’s insurer.
The case is Arthur v. Catour; read the opinion of the Illinois Supreme Court here. The decision cites to the law of other jurisdictions on the issue.
Day on Torts