Sometimes the black letter law passed by the legislature is unclear. The legislature can’t anticipate every possible fact scenario when they pass a law, so it lay to the courts to interpret the law and give guidance to what it means. This interpretation is called case law. When the court decides a certain meeting to the law it essentially answers a legal question. Lawyers and other courts then can rely on that ruling when they have a similar issue in their case. The following case answers the question above.

Martinez v. Milburn Enters., 233 P.3d 205 (Kan. 2010).

This case addresses the following issue:

Will benefits a plaintiff receives from a health insurance provider reduce the amount of monetary damages a plaintiff can recover from a defendant?

This case explored the issue of whether benefits received by a plaintiff from a health insurance provider reduced the amount of monetary damages a plaintiff could recover from a defendant. In exploring this issue, the court held that benefits received by the plaintiff from a source wholly independent of the wrongdoer (such as a health care provider) would not reduce the damages otherwise recoverable from the wrongdoer. Id. at 208.

On July 23, 2005, the plaintiff slipped and fell while shopping at defendant’s business. Id. She underwent back surgery and was ultimately billed $70,496. Id. The hospital accepted $5,310 in satisfaction of the bill: $4,689 from plaintiff’s private health insurance provider and $621 from plaintiff as her deductible and co-pay. Id. Pursuant to its contract with the health insurance provider, the hospital wrote off the balance of $65,186. Id. The plaintiff filed a suit to recover the full damages ($70,496) and the defendant asked the district court to prevent plaintiff from claiming the full damages. Id. In response, the district court limited the plaintiff’s recovery to those amounts actually paid by the health insurance provider and the plaintiff ($5,310) and prevented her from submitting evidence of medical expenses in excess of that amount. Id. As a result, the plaintiff appealed the court’s decision to withhold the $65,186. Id.

In order to address the plaintiff’s appeal, the Supreme Court of Kansas first looked to the description of the collateral source rule. Id. According to the court, the collateral source rule prevented benefits (such as the hospital writing off $65,186 because of their contract with the health insurance provider) received by the plaintiff from a source wholly independent of the wrongdoer from reducing the damages otherwise recoverable from the wrongdoer. Id. Consequently, the plaintiff argued that the district court failed to apply the collateral source rule and, as a result, $65,186 of the original hospital bill, $70,496, was incorrectly withheld from the jury’s consideration of her damages. Id.

The Supreme Court of Kansas next looked to the district court’s reasoning for withholding the $65,185 from jury consideration. Id. The district court stated the plaintiff’s recovery should be limited to the amount actually paid by the private insurance provider. Id. at 209. Furthermore, the district court found that allowing the write-off amount ($65,185) was a misleading piece of evidence that did not actually occur as damage to the plaintiff. Id. Moreover, the district noted the plaintiff’s only medical damage was $5,310 and to require the defendant to pay for some amount that was not paid would be giving the plaintiff the benefit of receiving more than her actual damages. Id.

After reviewing the district court’s reasoning, the Supreme Court of Kansas examined the defendant’s arguments for upholding the district court’s decision. Id. First, the defendant argued that requiring the defendant to pay more than the amount necessary to satisfy the plaintiff’s financial obligation violated fundamental fairness. Id. Second, the defendant argued that the entire purpose of damages was to make the plaintiff “whole”—put the plaintiff in the position he or she would have been had the injury not occurred. Id. And, awarding the plaintiff the additional $65,186 would make her more than whole. Id. Finally, the defendant argued the plaintiff was only entitled to recover the “reasonable value” of her medical care and expenses. Id.

After analyzing the district court’s reasoning and the defendant’s arguments, the Supreme Court of Kansas held that the collateral source rule did not apply to prevent evidence of (1) the amount originally billed by the health care provider for the plaintiff’s medical treatment ($70,496) or (2) the reduced amount accepted by the provider in full satisfaction of the amount billed ($5,310). Id. at 208. The court determined neither was prevented because they both were relevant to prove the reasonable value of the medical treatment, which was a question for the jury. Id. Therefore, the jury could use both numbers to determine the plaintiff’s damages. Id.