Court Opinion

ID: 3111273
Source: CourtListenerOpinion
Date Created: 2015-10-16 06:54:48.011991+00
Date Added: 2024-06-11T11:44:55.761352
License: Public Domain

NO. 07-09-0362-CV

                                       IN THE COURT OF APPEALS

                                  FOR THE SEVENTH DISTRICT OF TEXAS

                                             AT AMARILLO

                                               PANEL E

                                           FEBRUARY 4, 2011

                        PROGRESSIVE COUNTY MUTUAL INSURANCE COMPANY, APPELLANT

                                                  v.

                                     NATIVIDAD DELGADO, APPELLEE

                           FROM THE 237TH DISTRICT COURT OF LUBBOCK COUNTY;

                           NO. 2007-541,767-A; HONORABLE SAM MEDINA, JUDGE

Before QUINN, C.J., and PIRTLE, J., and BOYD, S.J.[1]

                                               OPINION

      This appeal involves an analysis of the limitation of  recovery  of  medical  and  health  care
expenses in a personal injury cause of action  imposed  by  the  "paid  or  incurred"  provisions  of
section 41.0105 of the Texas Civil Practices and Remedies Code.  See Tex.  Civ.  Prac.  &  Rem.  Code
Ann. § 41.0105 (West 2008).[2]   Appellant, Progressive  County  Mutual  Insurance  Company,  appeals
from a judgment entered in a negligence action in favor of Appellee, Natividad Delgado,  following  a
jury trial.  Delgado originally filed suit against George Brent Bailey, Jr.,  the  driver  whose  tow
dolly carrying an automobile became disconnected  from  his  vehicle  and  struck  Delgado's  pickup.
Delgado also sued his insurance carrier,  Progressive,  alleging  that  Bailey  was  an  underinsured
motorist.  Prior to trial, Bailey's liability insurance carrier, Safeco  Insurance  Company,  settled
Delgado's liability claim for  its  policy  limits,  $25,000.00.   In  a  single  issue,  Progressive
contends the trial court erred in entering judgment for past medical  and  health  care  expenses  in
excess of the amounts actually paid or incurred by or on behalf of Delgado.   We  reverse  the  trial
court's judgment and render judgment that Delgado take nothing.

                                              Background

      In December 2007, Delgado filed a  negligence  suit  against  Bailey  and  Progressive  seeking
damages for past medical expenses, physical  pain,  mental  anguish,  physical  impairment,  loss  of
earning capacity, and physical disfigurement arising out of a motor vehicle accident.  In June  2009,
Delgado's suit went to trial.

      At trial, counsel for both parties stipulated that:  (1) the policy  limits  for  Progressive's
underinsured motorist benefits were $25,055.00; (2) Delgado settled the  claims  against  Bailey  for
his policy limits of $25,000.00; and (3) Delgado collected $2,525.00 in  Personal  Injury  Protection
("PIP") benefits from Progressive prior to filing suit.

      At the trial's conclusion, the jury found Bailey negligent and awarded  Delgado  the  following
damages:

      a.    Medical care incurred in the past.

            1.    Covenant Medical Center                $49,269.39

            2.    Lubbock Surgical Associates      $  1,567.00

            3.    Lubbock Diagnostic Radiology           $  2,043.00

            4.    Efrem S. Alambar, M.D.                 $       89.00

      b.    Past physical pain.               .          $13,258.00

      c.    Past mental anguish.                   $     0

      d.    Past physical impairment.                    $  5,000.00

      e.    Physical disfigurement.                      $     0

      f.    Past loss of earning capacity.               $  1,200.00

      In Delgado's motion for entry of judgment, he calculated his recovery as  follows.   First,  he
deducted the PIP benefits paid by Progressive, $2,525.00, from the total jury  award  ($72,426.39  --
$2,525.00 = $69,901.36).  Delgado then calculated prejudgment interest on $69,901.36  from  the  date
suit was filed until his settlement with Bailey. He then added the prejudgment interest of  $3,351.44
to $69,901.36 for a total of $73,252.80.  Delgado then deducted the  Bailey  settlement,  $25,000.00,
arriving at $48,252.80.  Next, he calculated  prejudgment  interest  from  the  date  of  the  Bailey
settlement until the date of entry of judgment, $1,612.83, and added that amount to $48,252.80 for  a
total of $49,865.63.  Because the stipulated policy limits were $25,055.00, Delgado asked  the  court
for judgment awarding the policy limits plus court costs, $793.30, or a total of $25,848.30.

      Progressive responded by filing a cross-motion asserting that, based on the jury  verdict,  the
undisputed evidence, the parties' stipulation and the reductions sought by Progressive under  section
41.0105, the trial court should enter a take nothing judgment.  Progressive  asserted  that,  of  the
$72,426.39 jury verdict, $52,968.39 represented an award of past  expenses  for  medical  care  while
$19,458.00 represented awards for past physical  pain,  physical  impairment,  and  loss  of  earning
capacity.  Progressive next asserted that, under section 41.0105, the past medical expenses  actually
paid or incurred on behalf of Delgado were $4,763.77.[3]  After adding  this  amount,  $4,763.77,  to
the jury's awards for past  physical  pain,  physical  impairment,  and  loss  of  earning  capacity,
$19,458.00, Progressive calculated Delgado's total collectible damages  at  $24,221.77.   Progressive
then asserted that $24,221.77 was less  than  its  offsets  and/or  credits,  $27,525.00  ($25,000.00
settlement with Bailey +  $2,525.00  in  PIP  expenses).   Progressive  concluded  that  Delgado  was
entitled to a take nothing judgment.

      At the hearing on the two motions, the trial court entered as exhibits the transcripts  of  the
testimony of three witnesses who testified at trial before the jury and out of the  jury's  presence.
Denise Trejo, vendor liaison for Covenant Health System (CHS),  testified  that,  although  Delgado's
total charges were $49,269.39, the amount actually  paid  by  Delgado's  Medicare  provider,  Avantra
Insurance Company, was $3,688.06.[4]  Trejo also testified that Delgado owed $265.00 in  addition  to
Avantra's payment.  She testified that,  pursuant  to  CHS's  contract  with  Medicare  and  Avantra,
Delgado is only required to pay $265.00 and  CHS  cannot  go  back  and  actively  seek  any  further
reimbursement from Delgado for any adjustment or write-off under CHS's agreement with Avantra.

      Allison McClain, practice manager  for  Lubbock  Surgical  Associates  (LSA),  testified  that,
although Delgado's total charges were $1,634.00, the amount actually paid  by  Avantra  on  Delgado's
behalf was $672.02.  McClain also testified that LSA accepted $672.02 as final  payment  pursuant  to
LSA's managed care agreement with Avantra.  She also testified that the $961.98 adjustment or  write-
off could not be billed back to anyone including Delgado.

      Joe Maddux, Chief Operating Officer for Lubbock Diagnostic  Radiology  (LDR),  testified  that,
although Delgado's total charges were $2,043.00, the amount actually paid  by  Avantra  was  $403.60.
Maddux further testified that LDR accepted $403.60 as payment in full and, pursuant to LDR's  managed
care agreement with Avantra, the $1,639.31 adjustment or  write-off  could  not  be  billed  back  to
anyone including Delgado.  At the hearing's conclusion, the trial court denied  Progressive's  motion
and adopted Delgado's calculation of judgment.  This appeal followed.

                                              Discussion

      Progressive asserts the trial court erred in entering a judgment  including  past  medical  and
health care expenses in excess of the amounts actually paid or incurred by or on behalf  of  Delgado.
We agree.

      Although the amount of damages to which a plaintiff is entitled is a question of fact  for  the
jury to decide, the proper measure used to determine this amount is a question of law for  the  trial
court. De Escabedo v. Haygood, 283 S.W.3d 3, 6 (Tex.App. --Tyler 2009, pet. granted) (citing  Burrell
Eng'g & Constr. Co. v. Grisier, 111 Tex. 477, 481, 240 S.W. 899, 900 (1922)).  Because  Progressive's
complaint that the trial court erred in applying an improper measure of  damages  is  a  question  of
law, we review the trial court's decision de novo.  Mathews v. Sasser, 164 S.W.3d 453, 458 (Tex.App.-
-Fort Worth 2005, no pet.) (citing Alamo Cmty. Coll. Dist. v. Browning Const. Co.,  131 S.W.3d 146,
161 (Tex.App.--San Antonio 2004, pet. denied).

      The plain language of section 41.0105 provides that medical expenses subsequently  written  off
by a health care provider do not constitute medical expenses actually incurred by the claimant or  on
his behalf where neither the claimant nor anyone acting on his behalf will ultimately be  liable  for
paying those expenses.  See Matbon, Inc. v. Gries, 288 S.W.3d 471, 481 (Tex.App.--Eastland  2009,  no
pet.); De Escabedo, 283 S.W.3d at 7-8);  Mills  v.  Fletcher,  229 S.W.3d 765,  769  (Tex.App.--San
Antonio 2007, no pet.). See also Tate v. Hernandez, 280 S.W.3d 534, 540-41 (Tex.App.--Amarillo  2009,
no pet.).  Here, the health care providers were  actually  paid  $4,763.77  in  medical  expenses  by
Avantra on Delgado's behalf,[5] and there is no legal means for the medical providers  to  bill  back
or seek reimbursement of their remaining balances from anyone, including Delgado.

      Accordingly, Delgado's collectible damages total  $24,221.77  ($4,763.77  in  medical  expenses
plus $19,458.00 awarded by the jury for past physical pain, physical impairment, and loss of  earning
capacity).  Because Progressive's offsets and/or credits, $27,525.00  subsume  Delgado's  collectible
damages, the trial court should have granted Progressive's motion for entry of judgment  and  entered
a take nothing judgment.[6]    Accordingly, Progressive's single issue is sustained.

                                              Conclusion

      The trial court's judgment is reversed and  judgment  is  hereby  rendered  that  Delgado  take
nothing.

                                        Patrick A. Pirtle
                                             Justice

-----------------------
[1]John T. Boyd, Chief Justice (Ret.), Seventh Court of Appeals, sitting by assignment.  Tex.  Gov't.
Code Ann. § 75.002(a)(1) (West 2005).

[2]Section 41.0105 of the Texas Civil Practice and Remedies Code states as follows:

      In addition to any other limitation under law, recovery of  medical  or  health  care  expenses
      incurred is limited to the amount actually paid or incurred by or on behalf of the claimant.

Tex. Civ. Prac. & Rem. Code Ann. § 41.0105 (West 2008) (hereinafter referred  to  as  "§  41.0105  or
"section 41.0105").

[3]Progressive asserted that the medical expenses actually paid  or  incurred  by  or  on  behalf  of
Delgado were as follows:

      (1)  Covenant Medical Center            $3,688.06

      (2)  Lubbock Surgical Associates        $   672.02

      (3)  Lubbock Diagnostic Radiology       $   403.69

            Total:                            $4,763.77

[4]Due to a dispute with Avantra,  CHS  refunded  to  Avantra  $2,258.12  of  the  $3,688.06  payment
reducing Avantra's payment to $1,429.94.  At the time of trial, CHS was attempting to  negotiate  the
disputed payment with Avantra and sought to recover back  the  refund,  $2,258.12.   Trejo  testified
that the most CHS would be  paid  by  Avantra,  if  their  negotiations  were  successful,  would  be
$3,688.06.  Because the calculations in Progressive's  motion  assumed  CHS  was  successful  in  its
negotiations and Delgado did not dispute Trejo's figures before the trial  court  or  on  appeal,  we
accept, for purposes of this appeal, Avantra's original payment of $3,688.06 as the  amount  actually
paid on Delgado's behalf.

[5]There is no evidence of record that Delgado paid the $365.00 balance owing to CHS  at  trial.   If
he paid the balance, the amount of the medical expenses actually paid or incurred  by  Delgado  would
increase to $24,586.00.  This amount  is  also  subsumed  by  Progressive's  offsets  and/or  credits
totaling $27,525.00.

[6]Although Progressive's judgment calculations failed to account  for  pretrial  interest,  we  find
that the amount of prejudgment interest would also be subsumed by this offset.