Opinion ID: 844253
Heading Depth: 1
Heading Rank: 5

Heading: Limiting plaintiff's recovery to the reasonable cost of care prevents a windfall recovery by the victim based on potentially inflated medical bills.

Text: The problem in the instant case arises due to the practice of inflating medical charges and then deeply discounting them, which has become the norm in this era of managed care. Before managed care, hospitals billed insured and uninsured patients similarly. In 1960, `[t]here were no discounts; everyone paid the same rates'usually cost plus ten percent. But as some insurers demanded deep discounting, hospitals vigorously shifted costs to patients with less clout. (Hall & Schneider, Patients as Consumers: Courts, Contracts, and the New Medical Marketplace (2008) 106 Mich. L.Rev. 643, 663, fns. omitted.) As a consequence, only uninsured, self-paying U.S. patients have been billed the full charges listed in hospitals' inflated chargemasters. . . . (Reinhardt, The Pricing Of U.S. Hospital Services: Chaos Behind A Veil Of Secrecy (2006) 25 Health Affairs 57, 62; see Health & Saf. Code, § 1339.51, subd. (b)(1) [chargemaster, or hospital charge description master is a uniform schedule of charges represented by the hospital as its gross billed charge for a given service or item, regardless of payer type].) Therefore, to reconcile the collateral source rule with the problem posed by potentially inflated medical bills, a uniform rule should apply. Irrespective of whether a plaintiff has private health insurance, is a donee or is uninsured, the plaintiff should be entitled to recover as economic damages for past medical expenses the reasonable value of the medical expenses the plaintiff incurred for tortiously caused injuries. With this approach, in the event the reasonable value of the plaintiff's treatment exceeds the amount the medical providers agreed to accept as payment in full from plaintiff's insurer, that difference is allocated to the plaintiff, rather than to the tortfeasor. This fully preserves the collateral source rule, and at the same time prevents a plaintiff from recovering excessive damages pursuant to potentially inflated medical bills.