In personal injury cases, is there a defensible strategy to significantly reduce claims for future medical damages through application of the Affordable Care Act? Time will certainly tell, but it does appear possible.
In its simplest terms, the Affordable Care Act (“ACA”) provides that all persons in the United States be afforded health insurance, regardless of health or financial situation. The essential benefits vary by state, but at a minimum, a health insurance policy must cover the following: emergency room services, hospitalizations, ambulatory services, laboratory services, maternity care, mental health and substance abuse treatment, prescription drugs, pediatric care, preventative/wellness services, and rehabilitative services.
The maximum out-of-pocket annual cost for an individual policy-holder varies by coverage plan and residence. For example, the maximum out-of-pocket annual cost in 2014 for an adult living in Cook County, Illinois was $6,600. That same year, a resident of Los Angeles County, California, paid, at most, $6,250. Before the ACA, a patient may have had to pay large premiums to secure coverage, and could quickly reach annual and lifetime limits. With the passage of the ACA, however, health insurers can no longer charge higher rates based upon medical history, and there are no lifetime limits or out of pocket minimums to cover future medical care expenses. As such, the ACA can be a useful tool when seeking to combat exorbitant future medical damages claims – rooted primarily in inflated projections of costs for necessary future medical care – in medical malpractice or personal injury cases.
Of course, given the potential for reduction in future medical costs – and overall case value – plaintiffs have strong incentive to combat arguments citing the ACA. Indeed, with the introduction of the ACA, plaintiffs can no longer feed the jury the fiction that the entire value of future medical expenses projection by an expert life care planner must come from the plaintiff’s pocket. One cannot assume that a plaintiff does not have health insurance to ease that cost, as such insurance is required by federal law. Accordingly, plaintiffs have cited the collateral source rule, subrogation, politics, and the general uncertainty of the ACA’s implementation, in efforts to preclude its introduction at trial.
The collateral source rule is the biggest hurdle to overcome in many jurisdictions. In Illinois, the rule excludes evidence of benefits received by the injured party from a source wholly independent of, and collateral to, the tortfeasor, as these benefits will not diminish damages otherwise recoverable from that tortfeasor. Defense counsel must establish arguments to defeat the collateral source rule, including arguments: that ACA compliance is mandatory; that there is no right of subrogation; and that ACA coverage is not “wholly independent” of the tortfeasor, as it operates as a “plan” funded by the defense in the event liability is incurred.
Other jurisdictions, including Illinois, are using some of the above arguments at various stages in litigation. These representative cases include: Brewington v. United States, No. CV 13-07672-DMG CWX, 2015 U.S. Dist. LEXIS 97720, at *13 (C.D. Cal. July 24, 2015); Donaldson v. Advantage Health Physicians (Mich.Cir.Ct.), First Bankers Trust Co. v. Memorial Medical Center, (Illinois Circuit Court); Joerg v. State Farm Mutual Automobile Insurance Co. (40 Fla. L. Weekly s553a); Allijah Jones, et al. v. Metro Health Center, et al. (Ohio); and Marcia Christy Guardia v. Humility of Mary Health Partners (Ohio).
In Brewington v. United States, a California bench trial resulted when plaintiff was injected with the wrong drug, causing permanent blindness in one eye, chronic pain, and depression and anxiety. In ruling on the amount of damages to award, the court considered – and relied heavily upon –the ACA. Specifically, the court directly referenced plaintiff’s access to ACA coverage.
In Donaldson v. Advantage Health Physicians, a Michigan Circuit Court order denied plaintiff’s motion in limine to preclude defendants from referencing the ACA, and plaintiff’s potential coverage under the Act. The court found that health insurance provided under the ACA is reasonably likely to continue into the future and held medical care and therapies that would be provided by insurance through the ACA could be discussed and argued at trial.
In First Bankers Trust Co. v. Memorial Medical Center, an Illinois Circuit Court order was entered allowing, in part, the introduction of the ACA. The order specified that the defense was allowed to produce evidence of the ACA as to its effect on the actual reasonable costs of medical services. Similarly, in Marcia Christy Guardia v. Humility, the court found that the ACA issue could not be avoided and it could not restrict reference to the ACA as it is “the law of the land.” Further, the court found that it could not prohibit the defendants from presenting their damage assessments for future care.
It can be beneficial to implement ACA defenses and arguments into your case at any stage of litigation, in efforts to successfully reduce claims of future medical damages rooted in the cost of necessary medical care. This can be done by asserting the ACA as an affirmative defense at the beginning of a case; integrating it into written discovery requests and interrogatories; exploring it at discovery depositions, and lining up the proper experts who have the background in ACA to support your arguments. The ACA can also be used as a settlement or mediation tool.
At trial, the ACA can be cited in motions in limine which seek to prevent plaintiff’s experts from introducing evidence of costs that cannot be incurred under the ACA. The defense may seek leave to demonstrate the maximum costs plaintiff may incur under the ACA, and may subsequently use that information to impeach life care experts.
To be sure, at any stage of litigation, securing a united front of experts who are all informed and familiar with the ACA is essential to making your arguments. The ACA can be a valuable tool in mitigation future medical damages. If the last few years are any indication, reference to the ACA, and its admissibility at trial in tort actions, will be a point of contention for years to come.