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Bill Introduced to Benefit Drunk Drivers at the Expense of Workers

Wisconsin State Senate and Assembly consider bills to benefit drunk drivers at the expense of workers with health insurance.

In an unprecedented move, a bill was introduced to the Wisconsin State Senate and Assembly to benefit drunk drivers at the expense of Wisconsin workers with health insuruance.

The bills, 2013 SB 22 and AB 29, seek to overturn an over 100 year old Wisconsin law known as the Collateral Source Rule. The Collateral Source Rule requires those who injure another, whether through an auto accident, drunk driving, texting while driving, failing to move to the left for a police officer, etc., to pay the full cost of the injured person's medical bills. The Collateral Source Rule has been in effect in Wisconsin for over 100 years and has been upheld by every sitting Wisconsin Supreme Court justice.

A handful of Wisconsin Legislatures (Representatives Jacque, Bies, Craig, Czaja, Kestell, Kuglitsch, Larson, Murphy, Sanfelippo, Spiros, Thiesfeldt, Weatherston, Ripp and Marklein; cosponsored by Senators Farrow and Grothmam) want to overturn this law to allow those who injure another to argue that they are not responsible for the full cost of the injured person's medical bills, but rather only the amount paid by the injured person's health insurance.

Here is how the current law works and the proposed change. John Doe works on the assembly line at a local company. Through his employer, John pays tens of thousands of dollars over the years for health insurance. John leaves work to head home. Jack Smith is drunk and texting while driving and blows a red light injuring John. John incurs $10,000 in medical bills. John sends the bills to his health insurance company and, because of the health insurance premiums John has paid over the years, John's health insurance pays $7,000. Under the current law, Jack and his insurance company are responsible for the full amount of John's medical bills ($10,000) without regard to what John's health insurance paid. The reason for this, a reason cited for over 100 years by the Wisconsin Supreme Court, is that Jack does not get to benefit from John's foresight in buying health insurance. Under the proposed bill, Jack and his insurance company would get to argue that John is not entitled to the full amount billed by the health care providers ($10,000) but rather is entitled to only what John's health insurance company paid ($7,000). Under this proposed law, Jack reaps the benefit of John working to pay for health insurance.

In summary, the new law penalizes workers such as John and benefits drunk drivers such as Jack. If you disagree with this proposed bill, call or write your State legislature to say no to 2013 SB 22 and 2013 AB 29.

This post is contributed by a community member. The views expressed in this blog are those of the author and do not necessarily reflect those of Patch Media Corporation. Everyone is welcome to submit a post to Patch. If you'd like to post a blog, go here to get started.

Brett Eckstein February 28, 2013 at 04:50 PM
Ladies and gentlemen, I'd like you to consider the present debate in a slightly different context. It's obvious that there's a fundamental difference on measure medical expenses. But the proposed bill would allow the defendant to benefit benefit of ALL payments that an injured party receives, no matter what the source. This includes life insurance. So, if a defendant were to kill, say, your wife, and you and your wife decided to protect your family by buying life insurance, the defendant gets to march into court and say that your total damages are reduced by the amounts you received from the life insurance. Think about that. For those that don't know, the legislature has already capped noneconomic damages at $350,000 for a spouse that is killed. This means that the value of everyone's relationship with their spouse is limited to $350,000. If you carry more than $350,000 in life insurance, the defendant will pay $0. Imagine a defendant walking into court and getting off scot-free simply because you acted responsibly in buying life insurance. That scenario is frighteningly real. I like Kevin am a trial lawyer. And as a husband, and as a father, I choose to pay life insurance premiums to protect my family, not to benefit anyone out there that might kill either me or my spouse. Whether applied to medical expenses or any other category of damages, this bill is bad news and designed to benefit only one source: liability insurance companies.
Randy1949 February 28, 2013 at 06:03 PM
Do I understand correctly that damages will be limited to ny amount NOT covered by insurance, which would more or less mean the deductible and the co-pay when it came to medical expenses? A person injured or damaged through someone else's negligence does deserve to be 'made whole', whether that is physical injuries, property damage or loss of earnings/earning potential. What has the law in Wisconsin been so far on property damage -- that is someone damages your car to the tune of $5,000? Is the plaintiff entitled to the full $5,000 or just their insurance deductible?
Jay Sykes February 28, 2013 at 06:41 PM
@Bret Eckstein... When did the legislature reduce the non-economic damages by the amount of life insurance? What was the prior amount of the $350,000 Cap, if any, preceding the change to reduce non-economic damages due to life insurance? Bret Eckstein Sez.... "the legislature has already capped noneconomic damages at $350,000 for a spouse that is killed. This means that the value of everyone's relationship with their spouse is limited to $350,000. If you carry more than $350,000 in life insurance, the defendant will pay $0. Imagine a defendant walking into court and getting off scot-free simply because you acted responsibly in buying life insurance. That scenario is frighteningly real."
Greg February 28, 2013 at 07:04 PM
Randy, As it applies to medical damages, the Collateral Source Rule allows the injured party to be compensated based on the amount billed by the hospital rather than the amount that the insurance provider paid. The proposed change awards the injured party full compensation for medical expenses based on what was actually paid, which includes deductible, co-payments and all related medical bills. The confusion comes from the difference of what was billed by the hospital and what was paid to the hospital. So as an example: If you, Randy, did something that resulted in a person being injured and you were found to be partially or completely at fault. The person that you injured went to the hospital and was billed $100,000 for services, but because they have health insurance and the insurance provider negotiates the charges the amount paid for the services was $20,000. Under the collateral source rule you would have to pay the injured party the $100,000 that was billed rather than the $20,000 expense that was incurred.
Greg February 28, 2013 at 07:24 PM
"The collateral source rule bars the admissibility of evidence at trial to show that a plaintiff's losses have been compensated from other sources, such as the plaintiff's insurance or workers compensation." "PROBLEM: The collateral source rule keeps important information relevant to the determination of damages from reaching the jury. It allows plaintiffs to be compensated twice for the same injury."
Brett Eckstein February 28, 2013 at 07:40 PM
@ Jay Sykes. Under the bill that is the subject of this discussion, that is exactly what defendants will be allowed to do. Again, ALL payments received from others (called "collateral sources") are now going to be admissible. This includes: health insurance payments, disability insurance payments, life insurance payments, etc. It includes a host of other things as well. For example, if you miss time from work but burn through your vacation time so that you still get paid while missing work, the defendant is allowed to argue that you have no damages because you got paid anyways. Sound fair? Realize that there is no recognized claim for "lost vacation time," so if you have a job and you miss work you and you use your benefits get $0 for lost wages. Kevin is raising legitimate questions about valuing medical expenses. My point is that people realize that this bill extends far beyond that. It penalizes people. For what?
Greg February 28, 2013 at 07:42 PM
"this bill is bad news and designed to benefit only one source: liability insurance companies." What about the businesses and people that pay the premiums? Insurance companies don't print the money that they pay out. "I choose to pay life insurance premiums to protect my family" Your family will still be protected.
Brett Eckstein February 28, 2013 at 07:43 PM
@Randy1949 - property damage is a little different. If the insurance company causes $5,000 in damages to your car, you get the lesser of the repair cost or fair market value. If repaired, you'll get your deductible back no matter. The collateral source rule does not apply here.
Brett Eckstein February 28, 2013 at 07:58 PM
"What about the businesses and people that pay the premiums?" Premiums are paid to pay for damages caused. In my example, if someone kills my spouse, I cannot imagine how anyone would say that the killer should be able to reduce my damages because I chose to buy life insurance proceeds. If you feel otherwise, I think we're at an impasse. "Your family will still be protected." This shows the fundamental disagreement between you and I here. I believe in holding people fully accountable for all damages they cause. In my example, that includes no reduction in damages because I chose to buy life insurance. You disagree. Again, we are at an impasse.
Greg February 28, 2013 at 07:59 PM
Brett, Is the purpose of a personal injury claim to compensate the injured person for a loss or to punish the person that is considered responsible for the injury?
Mr Lundt February 28, 2013 at 08:02 PM
Big deal this happens today. You are creating a problem were none exists in reality. There is an accident and one person has soft tissue injuries and see a Chiropractor for three months. THe other person breaks a rib. Often times the Chiropractor bills will exceed broken rib bills. However the amount of the bills are a element of the amount of the settlement not THE determining factor. So today other factors help determine the final payout---that happens today and this bill will not ---in real terms---change that. So the insurance company get reimbursed for their medical bills and the injured party gets paid based on the merits of the case. Just like today and totally reasonable.
Brett Eckstein February 28, 2013 at 08:10 PM
It's actually both. Kevin referenced the Orlowski decision, handed down last term where all 7 supreme court justices (meaning all "liberal" and "conservative" justices) agreed that the collateral source rule fulfills both purposes of tort law. here's what the court said: Within our law on damages we have adopted the collateral source rule, which provides that "a plaintiff's recovery cannot be reduced by payments or benefits from other sources." The policy justifications for the collateral source rule have been summarized in a number of ways. Each case emphasizes the policies relevant in that particular case. In this case, we highlight three policies central to the collateral source rule. First, is to deter a tortfeasor's negligent conduct "by placing the full cost of the wrongful conduct on the tortfeasor." Second, is to fully compensate the injured party. Third, is to allow the insured to receive the benefit of the premiums paid for coverage that he or she had the foresight to purchase.
Greg February 28, 2013 at 08:27 PM
"if someone kills my spouse" "the killer"??? What if your wife is injured and dies? If she slips on a wet floor is the janitor the "killer" or is the business owner the "killer"? If she slips in your tub are you the killer? The impasse happens because the personal injury lawyers will lose money due to this bill, and from word one have not been able to be honest with their opposition to the bill. The blog started with "Bill Introduced to Benefit Drunk Drivers at the Expense of Workers" and the lawyers opposing the bill have twisted most everything since.
Randy1949 February 28, 2013 at 08:34 PM
There's negligence -- a custodian who neglects the ice on the front steps of his building and the wife falls down and breaks her neck -- and then there's criminal negligence -- driving the wrong way down the expressway with a BAC of three times the legal limit. That's a killer.
Greg February 28, 2013 at 08:37 PM
Does the new law prevent the jury from awarding the plaintiff damages that do the following and more? First, is to deter a tortfeasor's negligent conduct "by placing the full cost of the wrongful conduct on the tortfeasor." Second, is to fully compensate the injured party. Third, is to allow the insured to receive the benefit of the premiums paid for coverage that he or she had the foresight to purchase.
Jay Sykes February 28, 2013 at 08:57 PM
I was trying to limit the scope of my question to the initial example. This piece of legislation covers lots of ground, so that was not very effective in this forum. Health insurance only has value if you 'use it'; it has no fungible 'cash value'. As it is required by federal law, without lifetime payout or insure-ability limits, The ACA insurance mandate makes it fair game as a collateral source. Life Insurance, Vacation and to some extent Disability Insurance it would seem should be excluded collateral sources as they may potentially fit your penalty theory or unjust enrichment. I really never know know what to do with the word 'fair' without understanding how other states have structured their laws on this subject. That would include a through analysis of the intended and unintended consequences.
Kevin R Martin February 28, 2013 at 10:10 PM
This proposed bill creates a problem where none exists. I'll try to show by example. Person A sees a chest surgeon for their broken ribs after getting into an accident. The chest surgeon charges $150 for the office visit. As part of their claim, Person A is entitled to the receive the "reasonable value" of the services provided by the chest surgeon. Under the current law, the "reasonable value" is the amount "charged" by the chest surgeon. Under the proposed bill, the person who caused the accident would claim that the "reasonable value" is the amount "paid" by health insurance. I'll show the absurdity this creates. If Person A has health insurance through their employer, the "reasonable value" under this bill is the amount paid by health insurance. If the person has not met their deductible, the "reasonable value" is now higher because the health insurance has not kicked in yet to pay anything. If Person A has insurance through HIRSP, the "reasonable value" is lower as the amount paid is by HIRSP is lower. Medicaid - lower yet; Medicare - even lower. Even more absurd is If Person A has no health insurance. Now the "reasonable value" is the amount charged by the chest surgeon because there is no health insurance company to pay anything. The "reasonable value" of medical services has never in the history of this State been premised on the amount "paid" because of this very discrepancy.
Mr Lundt February 28, 2013 at 10:24 PM
Kevin here is where your logic fails. This part of the bill allows you to recover your out of pocket medical costs. So Person A= $5000 bill Person B= $7000 bill Each are entitled to receive ONLY the total amount of their bill. Person A does not get to profit an additional $2000. In the end EACH party end up getting their OOP paid for--no more no less. This has NOTHING to do with pain and suffering or any other claims. THat is handled separately.
Brett Eckstein February 28, 2013 at 10:30 PM
Does it prevent the jury from figuring out damages? No. But it allows the defendants to introduce evidence that for 100 years has been precluded because the evidence has absolutely is absolutely irrelevant on the measure of damages. That's the point of Kevin's original article. My point is that life insurance is in the same boat as health insurance which is in the same boat as other employer benefits (such as vacation time, sick time, paid time off, or what have you). There is no meaningful distinction between these collateral sources. My goal is to challenge you as to why it is that a defendant should get the benefit of ANY of these collateral sources. Let me leave you with this: If you truly believe that defendants should be allowed to reduce their liability for damages they caused based on payments the plaintiff receives from other places, I hope that you never feel the sting of the position you advocate, because it has the potential to be horrible.
Jay Sykes February 28, 2013 at 10:45 PM
@Kevin R Martin.... Person A gets a $1,000,000.00 Hospital bill from accident. Person B is determined to be 100% liable: Example #1: Person A has No insurance, what is the maximum person A can collect under current law from Person B under current and then proposed law as it relates to the hospital bill? Example #2: Person A has O deductible Insurance policy that pays $500,000.00 as negotiated full and complete hospital payment. What is the maximum person A collects under current and then proposed law from person B as it relates to the hospital bill? Example#3: Person A has O deductible Insurance policy that pays $250,000.00 as negotiated full and complete hospital payment. What is the maximum person A collects under current and proposed law from person B as it relates to the hospital bill?
Hershal Webster February 28, 2013 at 10:47 PM
The "reasonable value" should be determined by the jury. The jury should be presented all numbers and the lawyers can make their case for reasonable value. As courts and lawmakers have come to understand the details of hospital pricing and billing practices, specifically that chargemaster/list prices are set to be discounted not paid, they have begun to adopt policies to limit the recovery of medical expenses to “the amounts actually paid or incurred on behalf of the patient.” Times change and some 100 year old laws need to change with them. When this law was written the reasonable value, of the services provided above, was probably a chicken.
Hershal Webster February 28, 2013 at 10:52 PM
All answers are $1,000,000.00
DICK STEINBERG March 01, 2013 at 12:41 AM
For the readers it would be of service if the bloggers post the proposed law. SB 22 can be found under WI. SB 2013 22. Question: what is the harm to allow the medical payment facts and subrogation rights to be transparent ? Subrogation payments can be settled by a compromise amount to the subrogated insurance carrier. In law school it is taught the a trial is a search for the truth. (member of State Bar of Wisconsin for 55 years and former trial lawyer and municipal judge)
Kevin R Martin March 01, 2013 at 01:19 AM
@Dick Steinberg I believe the first sentence of my post listed the bills. This bill does not change subrogation law, only the collateral source rule. Aside for allowing a defendant to benefit from the injured person's health insurance premiums, the potential harm is also the these rulings could have on health care providers. If a jury determines the reasonable value of the health care providers service is the amount paid by Medicare or Medicaid, and a judge enters an order to that effect, what is to stop a Wisconsin commercial health insurer from arriving at the same conclusion. If Wisconsin commercial health insurers reimburse at the same rate as Medicare / Medicaid, the effect on physicians would be devastating. You are right that a trial is a search for the truth. But this search does not allow a free-for-all in the evidence to be admitted at trial. As you know, irrelevant evidence is not admissible. This bill would allow evidence of life insurance proceeds, social security benefits, and more. Every circuit court judge that I have been in front of has concluded that there is no relevance to this evidence. Every appellate and supreme court decision has concluded that there is no relevance to this evidence. Now a bill drafted and supported by auto insurance companies seeks to turn over a century of precedent on its head.
Greg March 01, 2013 at 01:39 AM
"what is to stop a Wisconsin commercial health insurer from arriving at the same conclusion" They would have a provider network that would be so small that their product/services would become worthless. Under the Obamacare 80% rule the insurance providers want the doctors to be paid well. If there is no relevance to the evidence you should have no problem keeping it from being admitted, correct?
Greg March 01, 2013 at 01:43 AM
Link to the proposed bill: https://docs.legis.wisconsin.gov/2013/related/proposals/sb22
Steve ® March 01, 2013 at 01:47 AM
Obamacare will take care of everyone Bren. You voted and promoted it, so now are you saying it won't?
Greg March 01, 2013 at 02:24 AM
"My goal is to challenge you as to why it is that a defendant should get the benefit of ANY of these collateral sources." Just like in the proposed bill, the key word is MAY. I don't think that a defendant should get the benefit of collateral sources, they may get the benefit. Why do you think that the plaintiff SHOULD get a phantom medical settlement? I know why, it's money in your pocket. Your claim that having your actual medical expenses paid, is or could be "horrible" needs to be expanded upon. Your job is to convince the jury how horrible it is, if the jury agrees they may adjust the payment accordingly. It may be horrible for the defendant to face financial ruin so that you and your client can vacation on an undeserved judgment.
Kevin R Martin March 01, 2013 at 02:56 AM
Greg, the picture next to your name is Uncle Sam flipping the bird and Obama's face in place of Uncle Sam. What is that?
NObama 2012 March 01, 2013 at 03:00 AM
A golfer hooked his tee shot over a hill and onto the next fairway. Walking toward his ball, he saw a man lying on the ground, groaning with pain. "I'm an attorney at Cannon & Dunphy," the wincing man said, "and this is going to cost you $5000." "I'm sorry, I'm really sorry," the concerned golfer replied. "But I did yell 'fore'." "I'll take it," the Cannon & Dunphy attorney said.

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