Opinion ID: 2584655
Heading Depth: 1
Heading Rank: 3

Heading: Bates v. Hogg

Text: Kansas appellate courts first considered the applicability of the collateral source rule to write-offs in Bates v. Hogg, 22 Kan.App.2d 702, 921 P.2d 249, rev. denied 260 Kan. 991 (1996). Hogg's pickup struck Bates' vehicle and injured Bates. Hogg filed a motion in limine to limit Bates' evidence of economic damages to the amount actually paid by Medicaid to medical care providers on her behalf. The district court granted the motion and prohibited Bates from presenting evidence of the market value or list price of her medical treatment. 22 Kan.App.2d at 703, 921 P.2d 249. The question presented in Bates was the same one presented in the instant case except that the write-off was pursuant to a Medicaid contract rather than a private insurance agreement. The Court of Appeals panel first pointed out that the `purpose of awarding damages is to make a party whole by restoring that party to the position he [or she] was in prior to the injury.' 22 Kan. App.2d at 704, 921 P.2d 249 (quoting Samsel v. Wheeler Transport Services Inc., 246 Kan. 336, 352, 789 P.2d 541 (1990), overruled in part on other grounds 248 Kan. 824, 844, 811 P.2d 1176 (1991)). It then explained the reasonable value of the medical cost of restoration: The fundamental principle of the law of damages is that a person who suffers personal injuries because of the negligence of another is entitled to recover the reasonable value of medical care and expenses for the treatment of his or her injuries, as well as the cost of those reasonably certain to be incurred in the future. (Emphasis added.) 22 Kan.App.2d at 704, 921 P.2d 249 (citing 22 Am. Jur. 2d, Damages § 197, p. 169). The Bates panel concluded that the collateral source rule simply was not applicable to its facts. It reasoned that because medical providers, by agreement and contract, may not charge Medicaid patients for the difference between their normal charges and the amount actually paid by Medicaid, then the amount allowed by Medicaid becomes the amount due and is the `customary charge' under the circumstances. Bates, 22 Kan. App.2d at 705, 921 P.2d 249. The panel further agreed with the taxpayer-based public policy rationale of a North Carolina federal court: `It would be unconscionable to permit the taxpayers to bear the expense of providing free medical care to a person and then allow that person to recover damages for medical services from a tort-feasor and pocket the windfall.' 22 Kan.App.2d at 706, 921 P.2d 249 (quoting Gordon v. Forsyth County Hospital Authority, Inc., 409 F.Supp. 708, 719 (M.D.N.C.1976)). In effect, the Bates panel endorsed limited application of the collateral source rule. Plaintiff was allowed to seek recovery of damages for the amount of medical expenses that was actually paid by a nonwrongdoer, i.e., from a source collateral to the wrongdoer. Plaintiff was not allowed, however, to seek recovery of damages for the amount written off because it was paid by no one. Judge, now Chief Judge, Rulon dissented, opining that a plaintiff should be allowed to recover the reasonable value of medical services rendered to treat an injury regardless of what amount was actually paid. 22 Kan. App.2d at 709-10, 921 P.2d 249.