Howell vs. Hamilton Meats & Provisions, Inc.

In Howell v. Hamilton Meats & Provisions, Inc., plaintiff sustained injuries in a vehicle accident caused by the negligent driving of defendant’s employee. The trial granted defendant’s motion to reduce by $130,286.90 a jury’s special verdict award for plaintiff’s past injury-related medical related expenses to $59,691.73. The appeals court reversed and remanded stating that in a personal injury case in which the plaintiff has private health care insurance, the negotiated rate differential is a benefit within the meaning of the collateral source rule, and thus the plaintiff may recover the amount of the differential as part her recovery of economic damages for the past medical expenses she incurred for care and treatment of her injuries.
The Howell court disagreed with the earlier appellate decisions (Nishihama/Hanif), and ruled that the amount of medical expenses written off by the medical providers was to be awarded to the plaintiff by application of the collateral source rule. The collateral source rule applies when an injured party obtains compensation for medical expenses from an independent source. Application of the rule results in a plaintiff being awarded the amount of money paid for example, by the plaintiff’s health insurer, notwithstanding the fact that the plaintiff did not pay that money. The Howell court’s application of the collateral source rule allows the plaintiff to be paid money for “medical expenses” over and above what her insurance carrier paid to fully compensate her medical providers for their expenses.
The Howell opinion distinguished the Hanif decision by noting that the plaintiff in Hanif was a Medicare beneficiary and, as such, had no legal obligation to pay the amount originally billed by that plaintiff’s medical providers. The Howell decision does not explain how the plaintiff is in any different position once the decision had been made by her medical providers to write-off the amount that she had previously been obligated to pay them.
The Howell opinion disagreed with the Nishihama decision by noting that this former case focused on the fact that the medical provider’s lien rights in that case were extinguished once it agreed to accept payment from the medical insurer in full as well as because the Nishihama opinion did not conduct an analysis of the collateral source rule.
The Howell decision is not binding authority until after the time to request review by the Supreme Court expires. It would not be unreasonable to believe that such review would be granted given that opinion’s stated disagreement with the Nishihama decision.

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