Tennessee Court Confirms Collateral Source Rule Still Applies

In personal injury cases, one of the biggest questions that a jury must determine is how much a plaintiff should get, if anything, in damages. Damages are usually the collection of costs like medical bills, lost wages, pain and suffering, damage to property, and other expenses that a plaintiff has incurred. In some instances, however, the amount that the plaintiff was initially charged for an expense is not the same as the amount that was ultimately paid. For example, perhaps a car dealership quoted the plaintiff a certain price, but the plaintiff’s friend agreed to cover half the cost. In these types of situations, a common question in calculating damages is whether the jury should look at the total expense incurred or the total expense paid.

In a recent Tennessee car accident case, the Tennessee Court of Appeals addressed this precise question. At the time, A.S. and L.S. were driving their vehicle when they were hit by a truck driven by a Tennessee Department of Transportation employee. The employee turned in front of their car without giving them time to stop, and they experienced both physical injuries and damage to their property. At the time of trial, A.S. and L.S. both presented evidence of their medical bills to support their claim for damages based on medical expenses. The Department of Transportation argued that both plaintiffs had received medical discounts on their bills, and the amount of those discounts should be provided to the jury under a Tennessee statute that provided for the presentation of “actual damages.”

In response, A.S. and L.S. argued that the collateral source rule prevented defendants from using evidence that a debt had been reduced or forgiven. The idea behind the rule is that the true measure of the damages a plaintiff has faced is the damages that were billed, even if those bills were later decreased. Ultimately, the jury was allowed to review evidence of the full amount billed, and the Department of Transportation appealed.

On appeal, the Tennessee Court of Appeals turned to a recent decision by the Tennessee Supreme Court addressing the applicability of the collateral source rule. In that case, the Supreme Court declined to modify Tennessee’s existing collateral source rule and held that defendants were precluded from submitting evidence related to the diminishment of a plaintiff’s expenses. The Court of Appeals acknowledged that that case was good law, and it decided that the only question that remained to be determined was whether the Supreme Court case applied to A.S. and L.S.’s case.

The Court of Appeals concluded that it did. In so deciding, it noted that similar cases had adopted the Supreme Court’s holding in determining that “actual damages” under Tennessee law did not mean the damages billed to a plaintiff after any reduction in bills but meant the compensatory damages that plaintiffs were entitled to receive, which included all expenses originally billed and other expenses such as pain and suffering or emotional distress.

The Court of Appeals further noted that had the Tennessee legislature ever intended to limit a plaintiff’s recovery only to those amounts they actually paid, it could have stated so explicitly in legislation. Since it did not do so, the courts declined to limit a plaintiff’s recovery in this way.

Accordingly, the Court of Appeals affirmed the application of the collateral source rule and upheld the prior decision to award A.S. and L.S. the full extent of the medical bills they received.

Plaintiffs who may have previously negotiated medical bills, or have been fortunate to have their medical bills cut down in the course of repayment, should be aware that this holding, and the Supreme Court case on which it relies, make clear that plaintiffs can recover the full amount of the original medical bills they received, as long as those bills are related to the injuries they incurred. Experienced Tennessee auto accident attorney Eric Beasley can help you make sure that you are recovering all of the damages to which you are entitled in your case. For more information or to discuss the circumstances of your case, contact the Law Office of Eric Beasley today at 615-859-2223.

Related Blog Posts:

Tennessee Court Reminds Plaintiffs To Be Wary of Statute of Limitations, Tennessee Personal Injury Blog, January 4, 2018.

Sixth Circuit Overturns Harsh Pleading Standards in Auto Accident Case, Tennessee Personal Injury Blog, December 6, 2016.

Determining Damages In Tennessee When The Jury’s Verdict Exceeds The Amount Requested, Tennessee Personal Injury Blog, November 2, 2016.



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