Tuesday, October 26, 2010

Deck v. Teasley[1]

Opinion handed down Oct. 26, 2010
Link to Mo. Sup. Ct. Opinion

In Deck v. Teasley, the Supreme Court of Missouri reviewed an action arising out of a traffic accident. After interpreting Missouri Revised Statutes section 490.715.5, the circuit court limited the plaintiff’s evidence of medical damages to the amount of money actually paid to the providers by Medicare coverage, supplemental insurance, and the plaintiff. The Supreme Court of Missouri held that section 490.715.5 supplies a rebuttable presumption that the dollar amount paid to satisfy the medical providers is the proper value of medical treatment when determining damages. The court found that the plaintiff had properly rebutted this presumption by presenting sufficient evidence that the amount billed was the actual value of her treatment. Additionally, the court held that testimony about possible future medical treatment, including surgery, is relevant and admissible, even if such treatment is not reasonably certain to occur at the time of trial.

I. Facts and Holding

In May 2003, the defendant in this action, Delmar Teasley, caused a multi-vehicle collision that involved the plaintiff, Edith Deck.[2] As a result of the collision Ms. Deck suffered injuries that required surgery, physical therapy, and follow-up medical care.[3] Her treatment resulted in bills in the amount of $27,991.30.[4] However, the amount actually paid to the providers by Medicare coverage, supplemental insurance, and Ms. Deck to satisfy the debt was only $9,904.28.[5]

Missouri Revised Statutes section 490.715.5 was amended “in 2005 to limit the evidence litigants could introduce regarding the value of medical treatment rendered.”[6] The amendment created a rebuttable presumption that the dollar amount actually paid to satisfy the debts owed to medical providers by a plaintiff are in fact the value of the medical treatment provided.[7]

The defense filed a pre-trial motion asserting that the medical damages presented to the jury should be limited to the $9,904.28 that was actually paid to the health care providers.[8] During a hearing on the motion, the plaintiff called three witnesses to testify about the correct value of the care received by Ms. Deck.[9] All three witnesses testified that the amount billed, instead of the amount paid, is the best indication of the value of the medical services received by the plaintiff.[10] After hearing the evidence offered by Ms. Deck, the circuit court found that the presumption in section 490.715 had not been sufficiently rebutted.[11] Accordingly, the court did not allow Ms. Deck to present evidence of the total amount billed and limited the medical damage evidence to the amount paid to the providers.[12] The jury found in favor of Ms. Deck and determined that her damages were $42,500.[13]

II. Legal Background

A. Missouri Revised Statutes Section 490.715.5

Section 490.715 codifies the collateral source rule, which prohibits a tortfeasor from reducing her liability by proving that the plaintiff received payments from a collateral source.[14] Subsection 5 of section 490.715 “provides that evidence of the dollar amount necessary to satisfy the financial obligation to health care providers is admissible at trial and creates the rebuttable presumption that such amount represents the value of the medical treatment rendered.”[15] However, if any party files a motion, the court may consider the admissibility of alternative evidence, such as medical bills, actual payment for treatment, or an estimated remainder to be paid.[16]

The court noted that “[a] presumption places the burden of producing substantial evidence to rebut the presumed fact on the party against whom the presumption operates.”[17] When a party produces substantial evidence against the presumed fact, the case proceeds as if no presumption existed.[18] However, the party entitled to the presumption is still able to present evidence that supports the presumption in an effort to persuade the fact finder.[19]

During the hearing on the value of medical treatment received, three witnesses testified on behalf of Ms. Deck, stating that the amount billed was in fact the correct value of the medical services provided.[20] One of the witnesses testified that “the amount billed by a health care provider is a better indicator of the value of the goods and services than the amount that Medicare reimburses” because the amount reimbursed does not cover the provider’s cost of business.[21] The Supreme Court of Missouri concluded that the evidence presented by Ms. Deck was substantial evidence that the amount billed was probative of the value of her treatment and the presumption in section 490.715.5 had been properly rebutted.[22]

The court did briefly discuss Mr. Teasley’s point that section 490.715 was amended to prevent windfalls to plaintiffs in personal injury cases.[23] However, that argument fails to consider the fact that the statute, as enacted, created only a rebuttable presumption that the amount paid to satisfy the obligation was the value of the medical treatment.[24] The court noted that the phrase “rebuttable presumption” conforms with the notion that the measure of damages is the “value of services rendered” and not necessarily the reimbursement amounts paid.[25]

In a footnote, the court pointed out that the legislature attempted to make unpaid medical bills inadmissible.[26] However, that attempt was unsuccessful, and the “rebuttable presumption” language was inserted in the final version of the bill.[27] The court construed this language to mean that a party is now able to introduce evidence that the value of services is higher than the amount paid to healthcare providers.[28]

The court held that the lower court was in error when, instead of determining whether substantial evidence had been presented, it weighed the evidence presented by both parties to determine the value of the medical treatment.[29] The court acknowledged that the language in section 490.715.5(2) that “the court may determine . . . the value of the medical treatment rendered” could be interpreted to allow the trial judge to make the determination of the value of medical treatment.[30] However, this interpretation is not “supported by a full reading of section 490.715.5, because the creation of a rebuttable presumption indicates that, if the presumption is rebutted, the jury would be presented evidence as though no presumption existed.”[31] The court determined that excluding the evidence of the amount billed to Ms. Deck was prejudicial and, therefore, she was entitled to a new trial on damages.[32]

B. Cost of Future Medical Treatment

Ms. Deck also argued that the trial court erred by not allowing expert testimony relevant to future medical expenses.[33] The court discussed the relevant law; however, it did not decide the issue because the case was remanded on the issue of damages.[34] Ms. Deck wanted to offer the testimony of a doctor who would testify that another MRI and future surgery might be necessary.[35] The trial court excluded the testimony because the doctor did not testify “to a medical degree of certainty that surgery would be needed.”[36]

In Swartz v. Gale Webb Transportation Company, the court stated that testimony about possible future medical treatment is admissible “for the purpose of establishing the nature and extent of the plaintiff’s present injuries.”[37] The court stated that plaintiffs are only entitled to recover for future injuries if the injury is reasonably certain to occur in the future.[38] However, expert testimony regarding the possibility of future medical treatment is admissible to help the jury determine the extent and nature of a plaintiff’s current injuries, even if the future treatment may not occur.[39]

III. Comment

Deck v. Teasley prevents section 490.715 from having its intended effect of limiting medical damages to amounts paid or reimbursed to the service providers. When creating a “rebuttable presumption” the legislature likely intended that plaintiffs are entitled to only recover monies that were actually paid on their behalf. Allowing plaintiffs to receive the money billed allows them to recover considerably more money than what was paid. Deck has essentially established that section 490.715 is a low hurdle for plaintiffs to overcome in order to recover the amount billed for their treatment.[40]

After the decision in Deck, the ball is back in the legislature’s court.[41] If it truly intended to limit plaintiffs’ recovery to the amount paid it will need to pass legislation with stronger language than a “rebuttable presumption.” With this decision, the amended statute’s impact on personal injury cases will be next to nothing. As in Deck, medical providers are likely to testify that their reimbursement rates do not represent the value of their services.[42] The lower courts are now on notice that, if they choose to limit medical damages to the amount paid under section 490.715 based on testimony that the amount billed is a better indicator of the value of medical services provided, they will likely face automatic reversal.

- Lawrence Hall

[1] 322 S.W.3d 536 (Mo. 2010) (en banc).
[2] Id. at 537.
[3] Id.
[4] Id.
[5] Id.
[6] Id. See also Mo. Rev. Stat. § 490.715 (2009).
[7] Id. at 537-38.
[8] Id. at 537.
[9] Id. at 538.
[10] Id.
[11] Id.
[12] Id.
[13] Id.
[14] Id. See also Mo. Rev. Stat. § 490.715.5 (2010)
[15] Id. at 539. See also Mo. Rev. Stat. § 490.715.5 (2010).
[16] Id.
[17] Id.
[18] Id.
[19] Id.
[20] Id. at 540
[21] Id.
[22] Id. at 541.
[23] Id.
[24] Id.
[25] Id.
[26] Id. n.2.
[27] Id.
[28] Id.
[29] Id.
[30] Id. at 541-42.
[31] Id. at 541.
[32] Id. at 542.
[33] Id.
[34] Id.
[35] Id.
[36] Id.
[37] 215 S.W.3d 127 (Mo. 2007) (en banc).
[38] Deck, 322 S.W.3d at 543.
[39] Id.
[40] Id. at 536.
[41] Id.
[42] Id. at 540.