In two recent opinions, the California Court of Appeal has clarified and expanded the scope of the California Supreme Court’s holding in Howell v. Hamilton Meats and Provisions, Inc., 52 Cal.4th 541 (2011), regarding the amount of damages a plaintiff may claim for medical services. In Howell, the court held that an injured plaintiff whose medical expenses are paid by a private insurer can recover as damages no more than the amount that the plaintiff’s medical providers, pursuant to a prior agreement with the insurer, had agreed to accept as full payment for the services. The plaintiff’s recoverable loss is limited to the amount paid or incurred for past medical services. The court stated that amounts in excess of what was paid or incurred “are neither paid to the providers on the plaintiff’s behalf nor paid to the plaintiff in indemnity of his or her expenses,” and “ because they do not represent an economic loss for the plaintiff, they are not recoverable.”
In Luttrell v. Island Pacific Supermarkets, Inc., 215 Cal.App.4th 196 (2013), the Court of Appeal held that Howell also applies where the medical services are paid by Medicare or Medi-Cal, rather than a private insurer. Noting the holding of Hanif v. Housing Authority, 200 Cal.App.3d 635 (1988), that medical damages should be limited to the amounts Medi-Cal had paid to the plaintiff’s medical providers because the plaintiff’s economic loss was only what Medi-Cal had paid, the Luttrell court stated that the source of the medical payments – whether private insurer or Medicare/Medi-Cal – did not change the final result: that plaintiff Luttrell “had no liability for past medical services in excess of those payments, so he is not entitled to recover anything more than the payment amount.”
In Corenbaum v. Lampkin, 2013 WL 1801996 (Cal.App. 2d Dist.), the Court of Appeal held that evidence of the full amounts billed by the plaintiffs’ medical providers was not relevant to the amount of damages for past medical services, for future medical services, or for noneconomic damages. In Corenbaum, the trial court had allowed evidence of the full amount billed to be heard by the jury, but then held a post-verdict hearing on reduction of the plaintiffs’ medical expenses to the amount incurred, at which it refused to reduce the amounts billed. Noting that Howell had not included within its holding the issue of the admissibility of such evidence, the Corenbaum court held that evidence of the amount billed was irrelevant to the issue of damages for past services, and was therefore inadmissible. Similarly, the court held that, because evidence of the amount billed for past damages was irrelevant, such evidence could not be relevant to determining the amount of the plaintiffs’ future medical expenses. Further, the court stated that evidence of the full amount billed for prior medical services could not support expert opinion on the “reasonable value” of future medical services.
And finally, the Corenbaum court held that evidence of the full amount billed for past medical services is not relevant to the issue of noneconomic damages for the plaintiffs’ pain and suffering. While noting that the determination of damages for pain and suffering is a difficult task, highly subjective, and within the discretion of the jury, the court stated that, where such evidence was inadmissible for other purposes, it could not be made admissible for use by the plaintiffs’ counsel as a “point of reference” or an “argumentative construct” regarding the dollar amount claimed for pain and suffering.
The Luttrell and Corenbaum opinions will provide guidance to trial courts regarding the determination of economic damages for medical expenses and what evidence is relevant and admissible for proving those damages. In applying Howell to cases where Medicare/Medi-Cal pays the medical providers, and in finding that evidence of the full amounts billed is irrelevant to a determination of past and future medical expenses, as well as of damages for pain and suffering, these opinions impose significant limitations on plaintiffs’ damages claims.