Recent Court Ruling Will Reduce Amount of Money Awarded to Plaintiffs

October 19, 2011

The Supreme Court of California recently denied plaintiff Rebecca Howell full compensation for her medical expenses from Hamilton Meats & Provisions, the company whose truck struck Hamilton's vehicle while making an illegal u-turn.

As a result of the accident, Howell suffered through two spinal surgeries, among other medical treatments. The initial bill for her medical expenses came to almost $190,000. Fortunately, Howell had the foresight to purchase health insurance to cover unforeseen medical costs like these, but doing so denied her almost $130,000.

It turned out that Howell's health insurance company negotiated with her medical care providers to reduce her medical expenses so that the insurance company ended up paying a little less than $60,000 of the $190,000 bill.

When Howell filed suit against Hamilton Meats & Provisions for damages that occurred as a result of her accident, the court considered the discrepancy between the initial $190,000 medical bill and the $60,000 her insurance company ended up paying. The Court decided that Howell was only entitled to damages equaling the total of the amount paid rather than the true cost of her care, which was the original amount billed.

In addition to this ruling, the Court also decided that if a jury previously awarded a sum to a plaintiff that is greater than the actual payment for medical expenses, the defendants can move for a new trial to reduce the "excessive damages." Plaintiffs would have the choice to either accept the new, reduced award or endure a new trial.

The Howell v. Hamilton Meats & Provisions decision will have drastic effects both on future cases and on past ones. The professional association Consumer Attorneys of California is concerned that the ruling will negatively impact injured plaintiffs, since it favors the companies that have committed the injury by allowing awards to be based solely on what was actually paid versus the true cost of the care. The fact that defendants could move for a new trial once damages have already been awarded to a plaintiff, effectively denying part of their settlement, is also disturbing.

The ruling also raises the question of whether Howell would have been better off foregoing health insurance in this case, since she may have had to pay the full $190,000 out of pocket without the advantage of an insurance company negotiating team. This may have increased the amount actually paid for her care, thus increasing her award. Of course, taking such a risk with one's general health is not wise or advised. But it does make one consider if these new rulings that favor companies rather than plaintiffs puts the injured public at a gross disadvantage.

If you are concerned about the ways in which the Howell decision may affect you or a loved one, please contact an experienced personal injury attorney about your situation.

Article provided by The Law Offices of Scott Warmuth
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