WHAT’S THE REASONABLE MEDICAL EXPENSE FOR TWO ASPIRIN? IT DEPENDS...

B Y : P E T E R C O L L I N S , J R . , G U S T R O S E N F E L D

Splitting headache after an accident. You see an ER nurse, an intern, a radiologist and the ER Physician. CT Scan is negative. You get two aspirin.

ER billed your insurer $4.00 for the aspirin. Your insurer paid $0.20 each, a total of 40 cents. Your advocate wants to list that aspirin as $4.00 to the jury.

Which is the “reasonable expense” of that aspirin?

We have a vigorous debate on the admissibility of medical expenses. Judges issue Minute Entries in different directions. State Bar Jury Instruction Committee debates. As of today, no Court of Appeals has directly addressed it. This article discusses the arguments, various rulings, and suggests a defense perspective. (A longer version with references is available upon request.)

PLAINTIFF TACTICS

Personal injury Plaintiffs are entitled to compensation only for those medical expenses that were reasonable and necessary. Burns v. Jaquay, 32 Ariz. 375, 379 (App. 1988).

Plaintiffs routinely disclose the full medical expenses caused by the accident, using Plaintiff treating physicians as witnesses. They disclose providers as percipient witnesses, claiming that each would testify to reasonableness of expenses. Those witnesses are not listed as experts, and no foundation for their opinions on medical expenses is provided.

These physicians may have an excellent basis for medical opinions, but rarely have basis for opinions on reasonable costs of medical care. This is a separate intellectual regime, where most physicians have no basis. But see Benedict v. Total Transit Inc., 499 P.3d 339 (App. 2021), where a physician was allowed to testify regarding reasonableness because he testified he was "aware" of billing practices. Plaintiff always cite Lopez v. Safeway, 212 Ariz. 198 (App. 2006) (See discussion below).

More recently, we have seen Plaintiffs’ Requests for Admissions that medical expenses are reasonable and necessary. Last year, Pima County Judge Metcalf ruled that a simple denial was insufficient: that the defense must assert – with expert testimony – that the medical bills were NOT reasonable or necessary.

Plaintiffs attack defense expert witnesses for lack of foundation for opinions on the reasonableness of bills, when they base their opinions on national statistics. (Klopotowski v. Arizona, MCSC, CV 2020-054681 (1.26.22).

The mere existence of the bills proves neither reasonableness nor necessity, both of which are required for disclosure and for admission at trial. The bills alone do not accurately describe the procedures performed, the treatment provided or any basis that they represent the reasonable, customary cost of the services rendered.

Defendants must take issue with Plaintiff's failure to comply with Rule 26.1(d). Insist that Plaintiffs disclose – by expert testimony with all the foundational requirements - that medical expenses were reasonable. There is no presumption in Arizona that medical bills, standing alone, are admissible without the requisite foundation. In fact, Arizona law states exactly the opposite.

LaBombard v. Samaritan Health System, 195 Ariz. 543, 552 (App. 1998) held: full “billed charges” are not the measure of reasonable and “ customary charges. " In Canyon Ambulatory Surgery Ctr. V. SCF Arizona, 225 Ariz. 414, 422-24, (App. 2010) the Court required proof that amount billed was a reasonable charge and held: the "billed amount" was not the reasonable charge.

In Larsen v. Decker, 196 Ariz. 239 (App.2000), the Court held that trial court did not abuse its discretion when it found that no foundation existed that medical bills were caused by and were reasonable and necessary results of Plaintiff’s accident.

Plaintiff counsel routinely argue – incorrectly - that Larson never decided that case on the medical billings. A careful reading shows they are wrong. The Court of Appeals affirmed the trial court's exclusion of medical records and expenses for lack of foundation.

2. Hearsay. No exception applies.

The only exception that could apply to this issue is Rule 803(6), records of a regularly conducted activity. But Rule 803(D) requires testimony from a custodian or other "qualified witness. " The defense should be aggressive in asserting the lack of qualification of Plaintiff's witnesses in this specific area. In Lopez v. Safeway, defense counsel made a tactical decision to stipulate that the bills would be deemed reasonable and customary. Id. at FN 4. Thus, the Court never reached this issue. Defendants should never so stipulate.

4. Collateral Source? No.

Plaintiffs claim this is a collateral source violation but it is not. The defense expert's position relies on national standards for costs.

One key is what the doctor accepted as payment in full. Judge Silver issued an excellent opinion in Jiménez v Progressive Preferred Insurance Company, 2020 WL 2037113, summarizing many decisions, and held: “Accordingly, the Court holds the “ reasonable expenses incurred for necessary medical expenses” are those expenses which the healthcare provider accepts as payment in full. ” (Para 10).

A. Challenge incomplete

Disclosure Statements. Force Plaintiffs to disclose the basis for "expert" opinions. B. Depose doctors. Challenge their personal knowledge of billings. Ask what they accepted as full payment. C. Hire experts. Multiple experts analyze reasonable expenses. They do not use collateral sources, but national databanks on actual reasonable costs. D. Start early. Challenge Plaintiffs’ lack of foundation at every opportunity.

E. Research Published Rates.

Every hospital is required to file “ usual and customary ” charges with ADHS.

I. CONCLUSION

Be aggressive. Start early. Challenge Plaintiffs on their lack of disclosure. Depose doctors. Ask specific questions to challenge their foundation. Use published materials. Hire experts early.

Don’t swallow the aspirin. Spit it out.