The Wisconsin budget was recently signed by the Governor. It contains a section that makes it easier for plaintiffs to collect the full value of their medical expenses from the person that hurt them. The law should help limit the expense of a lawsuit and allow people hurt through no fault of their own to receive full compensation.
The law in Wisconsin is that a person who causes injury to another is responsible for all the harm caused. If the injured person receives money from a third-party, such as a health insurance company, the recovery is not reduced by the third-party payment. Another example is if the injured person gets money from her parents to make up for the wages she lost while she was recovering from the car accident. This is called the collateral source rule. The policy behind the rule is that the wrongdoer should not benefit because the injured person had the foresight to purchase insurance, or had generous relatives.
Insurance companies do not like the rule and have tried for years to undercut it. They would challenge the medical bills presented by the injured person, and claim they were not reasonable in amount. The argument was that the injured person’s insurance company paid less than the billed amount, and therefore the hospital’s charge was not reasonable. The argument continued that the injured person should only get the amount charged by their health insurance carrier. The insurance companies made this argument even when there was no health insurance.
The insurance companies’ tactics made it more difficult to prove the medical expenses. An injured person had to hire an expert to say the hospital bill was reasonable in amount. The insurance company would hire an expert to say the hospital overcharged for its services, and the reasonable amount is the amount charged by medicare. The risk is that the injured person does not receive full payment for her medical bills.
The new law provides:
908.03 (6m) (bm) Presumption. Billing statements or invoices that are patient health care records are presumed to state the reasonable value of the health care services provided and the health care services provided are presumed to be reasonable and necessary to the care of the patient. Any party attempting to rebut the presumption of the reasonable value of the health care services provided may not present evidence of payments made or benefits conferred by collateral sources.
The law adds protection for the injured person. They should not have to hire an expert on the reasonable value of the medical bills, which saves them money. Further, the insurance company will have a more difficult time denying an injured person payment of her medical expenses.