Court Opinion

ID: 9701191
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:09:34.657664+00
Date Added: 2024-06-11T18:21:20.733246
License: Public Domain

NIGRO, Justice, dissenting..
Because I cannot agree that the amount actually paid and accepted by Appellee (“Crozer”) as payment in full for the medical services rendered ($12,167.40) is the amount Appellant’s decedent (“Baxter”) is entitled to recover as compensatory damages, I must respectfully dissent. Instead, I would affirm that portion of the Superior Court’s decision in which it found that Baxter is entitled to the reasonable value of the medical services provided ($108,668.31).
*167As noted by the majority, the primary objective of a compensatory damage award is to provide just compensation for the injured party’s loss, so that the injured party may be made whole, and be restored to a position as nearly as possible equivalent to her position prior to the tort. See, e.g., Trosky v. Civil Serv. Comm’n., City of Pittsburgh, 539 Pa. 356, 652 A.2d 813 (1995); Feingold v. Southeastern Pennsylvania Transp. Auth., 512 Pa. 567, 517 A.2d 1270 (1986). To that end, compensatory damages are imposed to shift the loss from a wholly innocent party to one who is at fault. Esmond v. Liscio, 209 Pa.Super. 200, 213, 224 A.2d 793, 799-800 (1966). A personal injury plaintiffs recovery for past medical expenses made necessary by a tortfeasor’s wrongdoing is limited to the reasonable value of the medical services provided. See Kashner v. Geisinger Clinic, 432 Pa.Super. 361, 367-68, 638 A.2d 980, 983 (1994)(discussing plaintiffs right to recover reasonable value of medical services made necessary by tortfeasor’s wrongdoing and noting that trier of fact must look to a variety of factors in determining the reasonable value of the medical service provided); see also Piwoz v. Iannacone, 406 Pa. 588, 178 A.2d 707 (1962); Brown v. White, 202 Pa. 297, 312, 51 A. 962, 965 (1902); Ratay v. Yu Chen Liu, 215 Pa.Super. 547, 260 A.2d 484 (1969); 1 Summary Of Pennsylvania Jurisprudence 2d § 9:59 (West 1999).
Unlike the majority, I believe the circumstances in the instant case clearly indicate that Baxter is entitled to $108,668.31 in compensatory damages. In finding that Baxter is only entitled to $12,167.40 in compensatory damages, the majority makes much of the fact that Crozer was contractually obligated to accept that amount as payment in full. While that may be true, such reasoning fails to take into account the fact that if Baxter had not been covered by Medicare and Blue Cross 65 or some other health insurance at the time of her fall at Crozer, she would have been personally responsible to Crozer as her medical provider for her entire medical bill of $108,668.31. Perhaps more importantly, the parties actually stipulated that $108,668.31 was the reasonable value of the *168medical services rendered to Baxter following her fall.1 Thus, I agree with the Superior Court that Baxter is entitled to the reasonable value of the medical services provided to her by Crozer.2
In reaching a different conclusion, i.e., finding that Baxter is only entitled to $12,167.40 as compensatory damages, the majority determines that where the amount initially billed by a plaintiffs health care provider is greater than the amount *169eventually accepted by the provider as payment in full for its services, the plaintiffs compensatory damages for past medical expenses should be limited to the amount actually paid to the provider. By doing so, the majority carves out a broad exception to the established rule of law in this Commonwealth that personal injury plaintiffs are allowed to recover the reasonable value of the medical services made necessary by the wrongdoer’s tortious conduct. Contrary to the majority’s holding, it is the value, and not the ultimate cost, of medical services made necessary by the tortfeasor’s negligence that determines the proper measure of compensatory damages for past medical expenses. See Kashner, 432 Pa.Super. at 367-68, 638 A.2d at 983 (noting that while the amount actually paid for medical services is relevant to determining the reasonable value of those services, it is still the value of the services, and not the cost, on which recovery of compensatory damages for said services depends); see also Restatement (Second) of Torts § 924 cmt. f (1979) (“the value of medical services made necessary by a tort can ordinarily be recovered although they have created no liability or expense to the injured person”).3
In addition, by creating this exception to the rule that injured plaintiffs are entitled to recover the reasonable value of their medical services made necessary by the wrongdoer’s tortious conduct, the majority seriously undermines the collateral source rule. This Court recently defined the collateral *170source rule and described the principle behind the rule in Johnson v. Beane, 541 Pa. 449, 456, 664 A.2d 96, 100 (1995), where we stated:
The collateral source rule provides that payments from a collateral source shall not diminish the damages otherwise recoverable from the wrongdoer. See generally, Beech-woods Flying Service, Inc. v. Al Hamilton Contracting Corp., 504 Pa. 618, 476 A.2d 350 (1984). The principle behind the collateral source rule is that it is better for the wronged plaintiff to receive a potential windfall than for a tortfeasor to be relieved of responsibility for the wrong.
By diminishing the amount of compensatory damages otherwise recoverable from a wrongdoer based on payments made to the wronged plaintiff by a collateral source, the new rule advanced by the majority clearly violates the collateral source rule. According to the majority, when a medical provider contracts with a third party payor to accept an amount less than the reasonable value of the medical services provided as payment in full, the purpose of compensatory damages is no longer served by permitting an injured plaintiff to recover the reasonable value of her past medical services made necessary by the medical provider’s tortious conduct. The majority repeatedly notes that the actual medical expenses paid on behalf of Baxter by Medicare totaled $12,167.40, and contends that any further recovery against Crozer in the nature of compensatory damages for past medical expenses would constitute a windfall. Although the majority chooses to emphasize the $12,167.40 payment that Medicare and Blue Cross 65 made to Crozer on Baxter’s behalf, that is not the proper focus. Rather, the collateral source rule prohibits the wrongdoer from diminishing the damages recoverable against it based on the payments, compensation, or benefits that a collateral source confers on a wronged plaintiff on account of her injury. See, e.g., Hileman v. Pittsburgh and Lake Erie R.R. Co., 546 Pa. 433, 439, 685 A.2d 994, 997 (1996)(collateral source rule prohibits defendants from introducing evidence that the plaintiff received compensation on account of his injury from a collateral source); Beechwoods, 504 Pa. at 623, *171476 A.2d at 352 (collateral source rule was intended to avoid precluding obtainment of redress for injuries merely because coverage for the injury was provided by a collateral source, such as insurance). In the context of the instant case, then, the focus for collateral source purposes is on the payment, compensation, or benefit conferred on Baxter by Medicare and Blue Cross 65 when they fully covered her post-injury medical treatment at Crozer.
It can hardly be argued that the benefit conferred on Baxter by Medicare and Blue Cross 65 was equal only to $12,167.40, the amount allowed by Medicare and ultimately accepted as payment in full by Crozer. Instead, by fully covering Baxter’s post-injury medical services, Medicare and Blue Cross 65 conferred a benefit on Baxter equal to the reasonable value of the medical services provided, which the parties stipulated to be $108,668.31. The collateral source rule dictates that Crozer cannot profit from the benefit that Baxter received from her health insurers, but that is exactly what the majority allows today.4
*172In addition, the majority’s reliance on Comment h to the Restatement (Second) of Torts § 911 for the assessment of the reasonable value of medical services provided to Baxter is misplaced. While Section 911 generally governs valuation, Comment h deals specifically with the measure of recovery for a plaintiff “who sues for the value of his services tortiously obtained by the defendant’s fraud or duress, or for the value of services rendered in an attempt to mitigate damages.” That provision is clearly not applicable to the instant case. The majority ignores Section 920A, which specifically explains the effects of benefits provided by collateral sources:
[Collateral-source benefits] do not have the effect of reducing the recovery against the defendant. The injured party’s net loss may have been reduced correspondingly, and to the extent that the defendant is required to pay the total amount there may be a double compensation for a part of the plaintiffs injury. But it is the position of the law that a benefit that is directed to the injured party should not be shifted so as to become a windfall for the tortfeasor. If the plaintiff was himself responsible for the benefit, as by maintaining his own insurance ..., the law allows him to keep it for himself. If the benefit was ... established for him by law, he should not be deprived of the benefit that it confers. The law does not differentiate between the nature of the benefits, so long as they did not come from the defendant or a person acting for him.
Restatement (Second) of Torts § 920A cmt. b.
Furthermore, although Comment f to Section 924 of the Restatement (Second) of Torts clearly states that the “value of medical services made necessary by the tort can ordinarily be recovered although they have created no liability or expense to the injured person,” the majority inexplicably finds Section 911 “to be more applicable to the instant case.” Majority Opinion, 765 A.2d at 791 n. 4.
*173In my view, the decision of the majority improperly limits the recovery of medical expenses by creating an exception to tortfeasor liability. Although it is the tortfeasor’s responsibility to compensate for all harm that he causes, and not just the net loss of the injured party, the majority exempts tortfeasors from liability for collateral benefits received by injured plaintiffs. Based on the above analysis, I would affirm that portion of the Superior Court opinion holding that Baxter is entitled to recover the reasonable value of the medical services ($108,-668.31) provided to her by Crozer as compensatory damages. However, I cannot agree with the Superior Court’s conclusion that Crozer is entitled to a setoff for the difference between the reasonable value of the medical services ($108,668.31) and the amount that Crozer accepted as payment in full pursuant to its voluntary participation in the Medicare program ($12,-167.40). Accordingly, I would award Baxter additional compensatory damages in the amount of $96,500.91, which is the difference between the reasonable value of the medical services provided to Baxter and the amount of compensatory damages for past medical expenses awarded by the trial court.

. It bears noting that Crozer could have litigated the reasonable value of the medical services it provided to Baxter in the trial court and could have argued to the trier of fact that the amount accepted as payment in full for such services from Medicare and Blue Cross 65 is the most accurate barometer for calculating the reasonable value of the medical services provided to Baxter. But Crozer forewent that opportunity, and instead opted to stipulate to the reasonable value of the services while arguing that: (1) Baxter’s compensatory damages should be limited to the amount of the payment from Medicare and Blue Cross 65; and (2) it was entitled to a setoff in the amount of the difference between the reasonable value of the medical services provided and the amount accepted as payment in full from Medicare and Blue Cross 65.

. As the majority notes, however, the Superior Court also found that Crozer is entitled to a setoff in the amount of the difference between the reasonable value of the medical services provided ($108,668.31) and the amount accepted as payment in full ($12,167.40). I disagree with this finding. "It is only where the tortfeasor himself makes a payment towards his tort liability that the payment will have the effect of reducing his liability.” Kashner, 432 Pa.Super. at 368, 638 A.2d at 984. No such payment in the form of free medical services or a voluntary relinquishment of a right to collect occurred in the instant case. Crozer was required, pursuant to its preexisting contract with the federal government to participate in the Medicare program, to provide the services in question for $12,167.40. In my view, Appellant should not be made to bear the cost of Crozer's agreement with the federal government, and Crozer should not be granted a setoff simply because it chose to become a Medicare provider and subsequently treated Baxter for the injuries she sustained due to Crozer’s own negligence. See Restatement (Second) of Torts § 920A(2)(1979)("[B]enefits conferred on the injured party from other sources are not credited against the tortfeasor’s liability, although they cover all or a part of the harm for which the tortfeasor is liable.”). As noted by Judge Olszewski in his dissenting opinion below, "[Crozer] did not contribute anything to [Baxter] that [Baxter] had not already received from Medicare.” Moor-head, 705 A.2d at 456 (Olszewski, J„ dissenting). Thus, I would reverse the decision of the Superior Court to the extent that it granted Crozer a setoff in the amount of the difference between the stipulated reasonable value of the medical services provided and the amount that Crozer accepted as payment in full for such services pursuant to its voluntary participation in the Medicare program.

. I further note that the majority ignores the fact that the underlying bases for tort recovery of medical expenses and the payment of an insured’s medical benefits are distinct. The basis for the former is liability — -an injured party is entitled to receive compensation, including the reasonable value of medical services, from a culpable tortfeasor. The basis for the latter is contractual — health insurers are contractually obligated to pay medical benefits to, or on behalf of, their insureds. See Michael F. Flynn, Private Medical Insurance and the Collateral Source Rule: A Good Bet?, 22 U. Tol. L. Rev. 39, 65 (1990). Likewise, medical providers are sometimes contractually obligated to accept as payment in full reimbursement from health insurers which is less than the reasonable value of the services actually provided to the insured. By concluding that the contractual obligations between an insured and his or her health insurer and a medical provider and that insurer diminish the insured’s recovery of compensatory damages, the majority blurs the distinction between the bases for tort recovery of medical expenses and payment of an insured’s medical benefits.

. In support of its conclusion, the majority also claims that awarding Baxter the additional amount of $96,500.91 would violate the tenets of fair compensation. The majority claims that its conclusion is consistent with several theories: that damages cannot be presumed, that damages must be reasonably precise, that duplicative recovery results in unjust, enrichment, that the injured person should be compensated with the least burden to the wrongdoer, and that a plaintiff has a duty to mitigate damages.
There were no presumed damages in this case. In fact, the parties stipulated to the exact amount of the medical expenses: $108,668.31. While it is true that an injured party cannot recover twice for one injury, under the collateral source rule, the tortfeasor is required to pay for all the harm he causes, even if this creates a double compensation for part of the plaintiff’s injuries. Restatement (Second) of Torts § 920A cmt. b. Moreover, the principle behind the collateral source rule, that it is better for the wronged plaintiff to receive a windfall than for the tortfeasor to pay less than the damages he owes, specifically refutes the majority's contention. Johnson v. Beane, 541 Pa. 449, 456, 664 A.2d 96, 100 (1995).
Finally, the majority finds that the principle of damage mitigation applies in the instant case. For example, the majority cites Robison v. Rupert, 23 Pa. 523 (1854), where this Court held that the plaintiff could not receive full compensation for damages caused when the defendant shot into a crowd of youths rioting outside his home. I fail to see how this rule of law applies to the instant case. Moreover, it stretches the *172bounds of relevance to analogize a patient injured by the negligence of a medical provider to the trespassing plaintiff in Robison, who was injured after provoking the defendant landowner.