Category Archives: Trial Practice

Tennessee Supreme Court Upholds Traditional Collateral Source Rule: Defendants Cannot Introduce Evidence of Discounted Rates Paid by Plaintiffs’ Medical Insurer

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The Tennessee Supreme Court has unanimously declined to change the law on what evidence can be used to prove medical expenses in cases involving personal injury.

In Jean Dedmon v. Debbie Steelman et al., W2015-01462-SC-R11-CV (11/17/17), the Court has held that Tennessee law continues to allow plaintiffs to use full, undiscounted medical bills to prove their medical expenses instead of the discounted amounts paid by insurance companies, and defendants cannot introduce evidence of those insurance payments.

Jean Dedmon had sued for injuries she sustained in a car accident, and attached the bills from her hospital and doctors to her complaint. While the case was pending, the Tennessee Supreme Court issued its opinion in West v. Shelby County Healthcare Corporation, 459 S.W.3d 33 (Tenn. 2014), and held that based upon the specific provisions of Tennessee’s hospital lien statutes, T.C.A. §§ 29-22-101-107, the hospital’s lien was limited to the discounted amounts paid by the patients’ insurance companies.

After West, the defendants in Dedmon argued that the West decision also changed the law in Tennessee for all cases involving personal injuries, contending that personal injury plaintiffs who have insurance can no longer use the full medical bills to prove their medical expenses. The trial court agreed and limited the plaintiffs’ proof on medical expenses to the discounted payments the hospital and doctors had contractually agreed to accept from Mrs. Dedmon’s insurance company.

The plaintiffs appealed to the Court of Appeals, which reversed the trial court, holding that West does not apply in personal injury cases outside the context of the lien statute, Dedmon v. Steelman, 2016 LEXIS 386 (Tenn. App. 2016).  However, while plaintiffs who have insurance can use full, undiscounted medical bills to prove medical expenses, the Court of Appeals also said that defendants could use discounted insurance payments to prove that the undiscounted bills were not reasonable. That, of course, opens the door to collateral source evidence.

The Tennessee Supreme Court agreed that its holding in West was not intended to apply to all personal injury cases, but reversed the Court of Appeals on the collateral source issue, holding that insurance payments and other benefits received by plaintiffs that do not come from the defendant (benefits that come from “collateral sources”), may not be used to reduce the defendant’s liability to the plaintiff.

The Supreme Court explained that Tennessee has always followed the collateral source rule, and that it prevents defendants from telling juries about plaintiffs’ insurance and other such benefits.  So, after a thorough review, the Supreme Court declined to alter existing law in Tennessee, and held that the collateral source rule applies. Therefore, the plaintiffs may introduce evidence of Mrs. Dedmon’s full, undiscounted medical bills as proof of her reasonable medical expenses, and the defendants may not introduce the discounted rates paid by Mrs. Dedmon’s insurance company for any purpose.  The defendants can use other evidence to show that the full medical expenses are not reasonable, however, as long as that evidence does not violate the collateral source rule.

One very interesting point made by the Court was: “it is evident that medical expenses cannot be valued in the same way one would value a house or a car,” since “health care services are highly regulated and rates are skewed by countless factors, only one of which is insurance.” The Court concluded that there is no reason to believe that discounted insurance rates are a more accurate way to determine the value of medical services.

The bottom line:  While the Supreme Court acknowledged that the collateral source rule is imperfect, it remains the law in Tennessee.


Will Pena-Rodriguez v. Colorado Permit Challenges to Civil Jury Verdicts Based on Racial Bias?

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In Edmonson v. Leesville Concrete Co., 500 U.S. 614 (1991) the Supreme Court held that a private litigant in a civil jury trial may not use racially‐motivated peremptory strikes any more than a government prosecutor may during a criminal trial, “Racial discrimination has no place in the courtroom, whether the proceeding is civil or criminal.” The Supreme Court explained that, for the limited purpose of jury selection, private litigants act as “government actors” and thus cannot violate the jurors’ constitutionally guaranteed equal protection rights.  Although mostly used in criminal cases, such Batson challenges to a racially motivated peremptory strike are occasionally utilized in civil cases during the selection process.

Recently, in Pena-Rodriguez v. Colorado, 197 L. Ed. 2d 107 (3/6/17), the Supreme Court has held that inquiry can be made into the validity of a jury verdict to permit the trial court to consider evidence of a juror’s statement suggesting that racial bias influenced his decision to find a defendant guilty of harassment and unlawful sexual contact.  One juror told the other jurors that he believed defendant was guilty because, in his experience as a former law enforcement officer, “Mexican men had a bravado that caused them to believe they could do whatever they wanted with women”

Although Pena-Rodriguez v. Colorado involved a criminal conviction, it is likely that it will be applicable in civil cases as well, as the Supreme Court cited Edmonson after stating: “To guard against discrimination in jury selection, the Court has ruled that no litigant may exclude a prospective juror on the basis of race.”

In civil cases, racial bias can play a role, either for or against a particular litigant.  Generally the sanctity of jury verdicts is upheld by the courts and inquiry into why or how a jury reached a particular verdict has not been permitted.  However, the U.S. Supreme Court has apparently opened the door to such inquiry if there is evidence of racial bias affecting the outcome.

Georgia Court of Appeals Reverses Defense Verdict For Exclusion of Nurse’s Testimony

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The Court of Appeals has reversed a defense verdict in a Georgia medical malpractice case, Elliott v. Resurgens, P.C., 2016 3/4/16)LEXIS 119, A15A2275 (3/4/16), where the trial court excluded the testimony of a material witness, a nurse, who had not been specifically identified by name during discovery and not listed in the pre-trial order (PTO).  Elliott sued over allegedly negligent treatment that he received after undergoing spinal surgery (during which he became paralyzed from the waist down).

A critical issue in the case was when the doctor learned of Elliott’s decreased ability to move his legs.  Although the medical records indicated the doctor was at the patient’s bedside at 9:00 a.m., he denied that when called to testify for the purposes of cross-examination at the trial.  Plaintiff’s counsel asked the doctor only one question: Whether he was at Elliott’s bedside at 9:00 a.m. on December 21, 2009? When he responded that he was not, they attempted to call Nurse Sullivan as the next witness. Counsel stated that she was a nurse at the hospital, and that she would testify that she was indeed with the doctor at the patient’s bedside at 9:00 a.m. But, the trial court excluded her testimony, because her name was never disclosed during the lengthy discovery period.

The Court found that the judge had erred holding that exclusion of probative trial evidence is not an appropriate remedy for curing an alleged discovery omission. In fact, that is true even when there is no excuse for a party’s failure to faithfully engage in discovery in compliance with an extended discovery deadline. Instead, if a trial court believes that a party has failed to properly comply with discovery, the only appropriate remedy is postponement of trial or a mistrial. When objection is made to the testimony of certain previously undisclosed witnesses, the proper procedure when they were called to testify was not to object to their testifying or to the admission of their testimony, but to move for a postponement of the trial for a sufficient length of time to enable the defendant to interview them, check the facts to which they would testify, and, if indicated, arrange to secure rebuttal evidence or to impeach them.

This case illustrates strong bias against exclusion of material evidence at trial, no matter what the circumstances.

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