Opinion ID: 835127
Heading Depth: 1
Heading Rank: 2

Heading: the collateral source statute, ors 31.580

Text: In this case, defendant acknowledges that the common law has permitted the recovery that we have described. However, defendant asserts, when the legislature adopted ORS 31.580 as a component of the comprehensive tort law revisions that it enacted in 1987, that body intended to change the common-law collateral source rule to preclude double recovery. We agree that ORS 31.580 modified the common-law collateral source rule and that it now provides the controlling law in actions for damages for bodily injury or death. We disagree, however, that ORS 31.580 prohibits double recovery. ORS 31.580(1) provides: In a civil action, when a party is awarded damages for bodily injury or death of a person which are to be paid by another party to the action, and the party awarded damages or person injured or deceased received benefits for the injury or death other than from the party who is to pay the damages, the court may deduct from the amount of damages awarded, before the entry of a judgment, the total amount of those collateral benefits other than: (a) Benefits which the party awarded damages, the person injured or that person's estate is obligated to repay; (b) Life insurance or other death benefits; (c) Insurance benefits for which the person injured or deceased or members of that person's family paid premiums; and (d) Retirement, disability and pension plan benefits, and federal Social Security benefits. By its terms, ORS 31.580 applies only to civil actions where a party is awarded damages for bodily injury or death. In those actions, subsection (1) permits, but does not require, a trial court to deduct from a plaintiff's award of damages those benefits that a plaintiff receives from a third party. Paragraphs (a) through (d) limit the circumstances in which a court may exercise its discretion to do so. Those paragraphs preclude a trial court from deducting four sets of benefits; paragraph (a) exempts from deduction those benefits that a plaintiff has an obligation to repay; paragraphs (b) through (d) exempt from deduction other specified benefits such as private and governmental insurance and retirement benefits, but do so without regard to whether a plaintiff has an obligation to repay those benefits, and paragraph (d) specifically precludes trial courts from deducting federal Social Security benefits from a plaintiff's damages award. Instead of relying on the text of ORS 31.580 to support its position, defendant requests that we look to its legislative history to discern that the legislature sought to eliminate any double recovery by plaintiff in the application of the collateral source rule. Although we will consider the legislative history of ORS 31.580, we emphasize that that legislative history cannot substitute for, or contradict the text of, that statute. [A] party seeking to overcome seemingly plain and unambiguous text with legislative history has a difficult task before it. Legislative history may be used to confirm seemingly plain meaning and even to illuminate it; a party also may use legislative history to attempt to convince a court that superficially clear language actually is not so plain at allthat is, that there is a kind of latent ambiguity in the statute. For those or similar purposes, whether the court will conclude that the particular legislative history on which a party relies is of assistance in determining legislative intent will depend on the substance and probative quality of the legislative history itself. We emphasize again that ORS 174.020 obligates the court to consider proffered legislative history only for whatever it is worthand what it is worth is for the court to decide. When the text of a statute is truly capable of only one meaning, no weight can be given to legislative history that suggestsor even confirmsthat legislators intended something different. State v. Gaines, 346 Or. 160, 172-73, 206 P.3d 1042 (2009) (s omitted; emphasis in original). Rather than disclose a latent ambiguity in its text, the legislative history of ORS 31.580 confirms our conclusion that, in enacting that statute, the legislature did not preclude double recovery of collateral source benefits. When the Senate Judiciary Committee considered the collateral source rule in 1987, it framed the policy choice as follows: The policy question here is: Should the defendant get the benefit of the plaintiff's planning and coverage from another source or should the plaintiff recover twice for some of his or her damages   ? Staff Measure Analysis, Senate Committee on Judiciary, Senate Bill (S.B.) 323, Feb. 11, 1987, Ex. G (memorandum prepared by Karsten Rasmussen) (hereinafter Staff Analysis). Some legislators sought to answer that question by requiring the trial court to deduct collateral benefits from a plaintiff's verdict except in circumstances in which the plaintiff would be required to repay the benefits or had purchased, earned, or invested toward the benefits. Those legislators introduced Senate Bill (S.B.) 323 (1987), which provided, in part: Section 13. (1) When in a civil action a party is awarded damages for bodily injury or death of a person to be paid by another party to the action, and the party awarded damages or person injured or deceased received benefits for the injury or death other than from the party who is to pay the damages, the court shall deduct from the amount of damages awarded, before the entry of final judgment, the total amount of those collateral benefits other than: (a) Benefits the party awarded damages, the person injured or that person's estate is obligated to repay; (b) Life insurance or other death benefits; (c) Insurance benefits for which the person injured or deceased or members of that person's family paid premiums; and (d) Retirement, disability or pension plan benefits. (Emphases added.) In the work sessions where that bill was discussed, members of the committee expressed a desire to prevent a plaintiff from recovering twice for the same injury; members, however, stressed the need that all economic issues [be] brought in i.e., including what the injured party had paid for the collateral damages in premiums, or what the injured party had earned through employment. See Minutes, Senate Committee on Judiciary, S.B. 323, Mar. 3, 1987, 5-6 (Senators Wyers, Cohen, and Brockman, and Chairman Frye expressing agreement that statute should be written to prevent true double recovery). Senator Brockman argued that the exceptions essentially neutered that section of the bill. He advocated replacing Section 13 with Senate Bill (S.B.) 347 (1987), which contained wording similar to subsection 13(1) (the amount    shall be deducted by the court), but without any exceptions. Id. The committee then heard testimony and received exhibits demonstrating that, in many cases, double recovery had been addressed by agreements or law that governed the relationships between plaintiffs and the third-party benefit providers. For instance, witnesses noted, subrogation clauses in insurance agreements and government benefit schemes reduced the instances of double recovery. See Staff Analysis (noting that there were few instances of actual double recovery); Testimony, Senate Committee on Judiciary, S.B. 323, Jan. 27, 1987, Ex. C (statement of Professor Dominick Vetri) (collateral source rule becoming less and less significant because of subrogation). A judiciary committee staff member advised the committee that passage of legislation which requires that collateral benefits be deducted from the verdict[] may either eliminate subrogation or penalize the injured party. Staff Memorandum, Senate Committee on Judiciary, S.B. 323, Mar. 17, 1987, Ex. G (Memorandum Regarding Collateral Benefits prepared by Eric Carlson). After considering that and other testimony, the committee voted to remove Section 13 from the bill. Minutes, Senate Committee on Judiciary, S.B. 323, Mar. 19, 1987, 20 (motion to delete Section 13 passed over votes of no from Senators Brenneman, Brockman, and Hamby). The effect of Section 13's removal would have been to leave the issue of collateral benefits to the existing common law that permitted double recovery. S.B. 323 then went to the House of Representatives. The House reinserted, as Section 9 of the bill, a provision that authorized, but did not require, a court to deduct collateral benefits received by a plaintiff, except those benefits that a plaintiff had an obligation to repay. Section 9 provided, in part: In any action arising out of bodily injury   , in the event that the injured party    has received benefit from a collateral source for which there is not an obligation to repay, the amount or value thereof may be deducted by the court from any verdict or award in [the] plaintiff's favor prior to the entry of final judgment. Before making the deduction, the court shall determine the cost to [the] plaintiff or [the] plaintiff's estate of obtaining such benefit and shall credit the cost against the amount of the benefit to be deducted from the judgment. House Amendments to C-Engrossed S.B. 323 (emphases added). The House Committee on Judiciary discussed the policy implications of the proposed House amendment and noted that the use of the word may would grant a court discretion to consider the collateral benefits that a plaintiff had received but did not have an obligation to repay. The permissive term would authorize a court to reduce a tort verdict by the amount of those benefits, less the cost of obtaining them, when necessary to prevent an unjust result. Minutes, House Committee on Judiciary, S.B. 323, June 6, 1987, 21. Representative Bunn argued in favor of replacing the discretionary may with a mandatory shall. In advocating for that position, he articulated the same concern about a plaintiff's potential windfall that lies at the heart of defendant's argument in this case. He urged the committee that the basic concept [of the collateral source revision] says that if you are being paid from some other source that you didn't have to pay for, we're not going to have the court award a judgment paying you a second time. If you got a judgment for $100,000 of costs and you got $50,000 of costs from some other source that you didn't have to pay for then we'll reduce the judgment by $50,000 so that you don't get a surplus.   . If we use the word `may' that will destroy the section. It will not provide a meaningful collateral source [statute]. Tape Recording, House Committee on Judiciary, S.B. 323, June 6, 1987, Tape 733 (statement of Representative Bunn). In response, Representative Dix asserted that [t]he compromise that was worked out was `may,' giving a judge discretion to reduce verdicts in certain situations and that that compromise [wa]s an important ingredient in the overall package. Id. (statement of Representative Dix). Representative Bunn subsequently moved to replace the word may with the word shall and that motion was defeated with all other members on the committee voting against the change. Id. The final House version of the bill also contained the four categories of benefits that the current version of ORS 31.580 exempts from judicial reduction, regardless whether a plaintiff stands to receive a double recovery. Thus, the legislature answered the policy question posed at the outset of its deliberations by deciding that, for those listed categories of third-party benefits, the plaintiff always should receive the benefit of his or her planning and investment and should not be prevented from recovering twice. For other, unlisted, benefits, a trial court should have discretion to consider the plaintiff's planning and investment and answer the question posed based on the particular facts presented. ORS 31.580 applies to this action for damages for bodily injury. We turn therefore to an examination of how that statute treats the collateral benefits at issue in this case. The collateral benefits that plaintiff received and that are at issue here are Medicare benefits. Medicare is a federally funded and administered medical insurance program for the elderly and disabled. 42 U.S.C. §§ 1395-1395hhh. Congress established Medicare as Title XVIII of the 1965 Social Security Act. Medicare provides individuals with varying degrees of coverage for different types of medical care. Part A of the Medicare program covers hospital stays. Beneficiaries generally fund the benefits that they receive under Medicare Part A by paying payroll taxes. 42 U.S.C. § 1395i(a). If beneficiaries have not worked a sufficient period of time to be eligible for Medicare Part A, then they may qualify for those benefits by paying premiums. Id. § 1395i-2a(d). Part B of the Medicare program provides medical and other health services, including physicians' services, medically necessary outpatient procedures, and preventative care. Id. § 1395x(s). Beneficiaries fund the benefits they receive under Medicare Part B by paying monthly premiums and a yearly deductible. Id. §§ 1395j-l. [5] The Medicare provisions of the Social Security Act assure beneficiaries that, except for deductibles and copays, they will not be required to pay for covered medical expenses. The Medicare provisions achieve that result in the following ways. [6] With respect to the services provided under part A of the Social Security Act, beneficiaries are entitled to have Medicare make payments on [their] behalf. Id. § 1395d(a). Medicare makes those payments directly to providers of hospital services. Id. § 1395g. Providers of hospital services must sign an agreement with Medicare not to charge beneficiaries for services for which beneficiaries are entitled to have payment made by Medicare. Id. § 1395cc(A)(1). With respect to services provided under Part B of the Social Security Act, Medicare beneficiaries are entitled to have Medicare make payments to [them] or on [their] behalf. Id. § 1395k(a)(1). There are two types of physicians under Part Bparticipating physicians and nonparticipating physicians. Participating physicians make an annual election to accept assignment of Medicare claims from Medicare beneficiaries. Nonparticipating physicians do not make an annual election to accept assignment, but may do so on a case-by-case basis. [7] Medicare pays an assigning physician directly, and assigning physicians agree to accept payment from Medicare as payment in full for their services. Id. § 1395u(b)(3)(B)(ii)(I). If a nonparticipating physician does not accept assignment from a Medicare eligible patient, then Medicare will pay the patient, not the physician. Id. § 1395u(b)(6). In that instance, the Social Security Act prohibits the physician from billing or collecting from the patient an amount that exceeds a statutorily defined limiting charge. 42 U.S.C. § 1395w-4(g)(1)(A)(i). [8] In this case, plaintiff's medical providers billed him $38,977 for their services. If plaintiff had not qualified for Medicare benefits, then he would have been liable for the entire amount that the providers had billed him. Instead, Medicare satisfied those bills by requiring that those providers accept Medicare payments of $13,400 as payment in full for their services. Defendant accepts that the amounts that Medicare actually paid his medical providers are exempt from deduction under ORS 31.580(1)(a), which exempts benefits that the plaintiff, the injured party, or that person's estate is obligated to repay. As defendant states it: Whether they are considered social security benefits, insurance benefits, or some other type of benefit, medical bill payments actually made by Medicare and for which Medicare has a right to reimbursement are clearly, under ORS 31.580(1)(a), a collateral source that may not be deducted from the judgment. (Emphasis in original omitted; emphasis added.) Defendant argues, however, that, because plaintiff does not have an obligation to reimburse Medicare for the write-offs that the Social Security Act requires, ORS 31.580(1)(a) does not apply to those write-offs and does not preclude their deduction. [9] However, as we have explained, if Medicare benefits fall into one of the categories set forth in ORS 31.580(1)(b), (c), or (d), then the trial court was precluded from reducing plaintiff's verdict by the amount of those benefits without regard to whether plaintiff had an obligation to repay them. One of those paragraphs, ORS 31.580(1)(d), specifically exempts federal Social Security benefits from deduction, and Medicare benefits are, as defendant acknowledges, benefits established as part of the Social Security Act. The Court of Appeals conducted a detailed analysis of the text of ORS 31.580(1)(d) and decided that that provision is not limited to Social Security retirement benefits but encompasses the benefits provided by all Social Security programs, including Medicare. White, 219 Or.App. at 74-75, 182 P.3d 215. In this court, defendant does not contend that the Court of Appeals erred in its analysis. Defendant instead points to similar statutes in other states that specifically mention Medicare benefits and argues that the lack of specificity in ORS 31.580(1)(d) makes that text ambiguous. Defendant then cites to legislative history that indicates that one legislator believed that Medicare and Medicaid payments would be treated as health insurance benefits under ORS 31.580(1)(c). Minutes, House Committee on Judiciary, S.B. 323, June 6, 1987, 21. Neither defendant's citation to other state statutes nor the legislative history of ORS 31.580 convinces us that paragraph (d) of that statute is ambiguous. For the reasons explained by the Court of Appeals, we think that the term federal Social Security benefits is comprehensive and includes Medicare benefits. If plaintiff had not been an eligible Medicare beneficiary, then he would have been entitled to recover and retain the jury award of $37,600, the reasonable medical expenses that plaintiff's providers had charged to him. Under ORS 31.580, plaintiff's status as a Medicare beneficiary and his receipt of Medicare benefits do not permit a different result. The legislature precluded the trial court from making any deduction from the jury verdict for Social Security benefits. In doing so, the legislature did not indicate an intent to distinguish between the payments that Medicare makes and the requirement that it imposes on medical providers to accept those payments in satisfaction of their charges; the legislature exempted from judicial deduction Social Security benefits; it did not exempt Social Security payments. Thus, the trial court in this case was correct to deny defendant's post-trial motion under ORS 31.580 to reduce the jury's award of medical expenses.