The Collateral Source Rule is Alive and Well

What ever happened to the Collateral Source Rule? It is alive; you just have to know how to implement it. Every California Attorney currently handling Personal Injury Litigation is all too familiar with Insurance Companies routinely reducing, or "Hanifizing", their client's medical bills. Insurance carriers are only willing to look at what is paid alien Health Insurance, not at the actual bills, the true value of the medical services rendered. This makes a huge difference buy Enzyte what is offered to settle claims. (See Hanif vs Housing Authority (1988) 200 Cal App 3rd 635, Nishihama vs City and County of San Francisco (2001) 93 Cal App 4th 298)

What's worse is that this practice is infecting the litigation process. More and more when cases go to Trial, Judges are granting defense firms' Hanif/Nishihama Motions in Limine. The result is that Juries are limited to considering only the amount paid for medical services rather than the amount billed. When Juries are permitted to see the actual medical bills, most Judges, at a post trial Hanif Hearing, slash the Jury award by the difference between the amount billed and the amount paid by the Health Insurance Provider.

You don't have to be handcuffed by Hanif. As a Personal Injury Trial Attorney, you can avoid this nightmare simply by having your client's medical treatment done on a lien instead of through his/her Health Insurance Provider. If you are confident in your case and there is sufficient insurance coverage to warrant it, there is very little risk to having these services performed on a lien basis since Health Insurance Providers invariably file liens against Third Party PI Cases anyway. The benefit, however, is enormous. When treatment is performed on a lien, the real value of medical services, not the artificial value given to them by Insurance Companies, is brought into Godzilla model Medical experts can testify that the full amount of the bills is reasonable and necessary. Hanif and Nishihama are avoided, and the Collateral Source Rule prevails.

Now that you know how to maximize the value of your client's case, the question is how to find doctors who will perform pain management or surgery on a lien basis. Many medical providers offer such services, but some are much better than others. One of the keys to maximizing your client's recovery is to get him the very best medical care from the very best providers. Make sure your doctor is Board Certified, is comfortable handling Med/Legal issues and is willing to testify both in a deposition and in court. Make sure the amount charged by the Surgery Center or Hospital is reasonable. Many less reputable facilities inflate their charges by 200%-300% so that when the case settles and they offer a 20% reduction in the bill, it sounds like a good deal. In addition to being highway robbery, obscenely inflated bills reflect poorly on even the best-presented case.

Getting the better doctors, hospitals and surgery centers to take a lien on a 3rd party personal injury case is difficult because they do not have to, and do not want to, be involved with negotiating and collecting liens. To avoid this, they work with companies like rel="nofollow" href="medicalfinanceusa.com">Medical Finance LLC, that purchase receivables, along with all the rights and interests, from medical providers. This allows medical providers to legitimately testify that they have been paid for their services, while preventing defense counsel from disclosing the factoring of the bill to the Jury (See Katiuzhinsky v s Perry (2007) 152 Cal App 4th 1288). When the case is resolved, the attorney negotiates the lien, not with the medical provider, but with the company that now owns the lien.

Defense Attorneys and Insurance Adjusters want to believe the Collateral Source Rule is dead. However, savvy case management involving treatment on liens will keep it very much alive and help ensure the maximum value of your case is achieved.

Michael D. Waks is the President & CEO of MedicalFinanceUSA.com