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Are They Getting Away with That?
A Discussion and Analysis of
Two Ongoing Discovery Disputes
1. Objections to Discovery of
"Bills Actually Paid" (Omaha area)
2. Objections to Discovery of Plaintiffs'
Full Medical History (Lincoln area)
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Issue 1: Are discounted medical bill rates (a/k/a amounts
actually paid for services) discoverable in a personal injury
action?
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Nebraska Revised Statute § 52-401 (Hospital Medical Lien Statute)
"For persons covered under private medical insurance or another private health benefit plan, the
amount of the lien shall be reduced by the contracted discount or other limitation which would have
been applied had the claim been submitted for reimbursement to the medical insurer or administrator of
such other health benefit plan. The measure of damages for medical expenses in personal injury claims
shall be the private party rate, not the discounted amount." Neb. Rev. Stat. § 52-401.
The Collateral Source Rule Prohibits:
• Evidence that the claimant has received compensation from some other source for damages sought.
• Evidence relating to the discounted amount of measure of damages for medical expenses in a personal
injury case.
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DEFENSE ARGUMENTS IN SUPPORT OF DISCOVERABILITY
3.
Evidence of the discounted rate is admissible for purposes other than the measure of damages.
Even if not admissible, evidence of bills actually paid is discoverable as it may lead to discovery of
other admissible evidence.
Evidence of private party rate should be admissible for public policy grounds.
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Evidence is admissible to determine if private party rate is "fair and reasonable." (MRI example)
Although the measure of damages in a personal injury case is determined by the private-party rates,
those rates must be "fair and reasonable," and when disputed, these rates become a question of fact
for the jury. Renne v. Moser, 241 Neb. 623, 634, 490 N.W.2d 193, 200 (1992).
• "The evidence at issue would be offered as to whether the rates were "fair and reasonable" and
would be admissible in this context, making this evidence discoverable. In determining what a "fair
and reasonable" rate is, the amount that third parties paid helps to determine an objectively fair and
reasonable rate. See Thomas R. Ireland, Ph.D., The Concept of Reasonable Value in Recovery of
Medical Expenses in Personal Injury Torts, J. Legal Econ., March 2008, at 87, 89-90 (noting that
courts typically avoid saying the "reasonable value" is always the amount billed, but instead
understand that medical care providers may sometimes charge fees that are not "reasonable," and
that, in his opinion, it is likely that third-party payments are many times closer than private party
rates to a "reasonable value" as legal economists would determine).
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1. Evidence of the discounted rate is admissible for purposes other than
establishing the measure of damages:
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Other Permissible Uses
Evidence of dates/times of treatment (if in dispute).
Impeachment (Example)
Difficult to foresee all possible uses for the evidence which should weigh in favor of it being
discoverable.
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Neb. R. Disc. § 6-326(b)(1): "Parties may obtain discovery regarding any matter, not privileged, which
is relevant to the subject matter involved in the pending action, whether it relates to the claim or
defense of the party seeking discovery or to the claim or defense of any other party, including the
existence, description, nature, custody, condition, and location of any books, documents, or other
tangible things and the identity and location of persons having knowledge of any discoverable matter. It
is not ground for objection that the information sought will be inadmissible at the trial if the information
sought appears reasonably calculated to lead to the discovery of admissible evidence."
• Inadmissible ≠ undiscoverable
• Discovery could lead to important information pertaining to treatment sought, names of medical
providers, names of pharmacies with providers, names of pharmacies with prescription records, or
amounts related to special damages.
• Records don't always match bills.
• This is a piece of Plaintiff's medical history.
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2. Even if not admissible, evidence of the discounted rate is discoverable as it may
lead to discovery of admissible evidence.
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Discovery of the discounted rate supports the likelihood of settlement of cases which would otherwise
go to trial.
Nebraska courts favor compromise of disputes through negotiation. Baker v. Blue Ridge Ins. Co., 215
Neb. 111, 113, 337 N.W.2d 411, 413 (1983).
When discussing whether the Supreme Court of Nebraska should allow discovery of insurance
agreements even if inadmissible, the Court emphasized, "Knowledge as to defendant's insurance
permits a more realistic appraisal of a case and . . . leads to settlement of cases which otherwise would
go to trial." Walls v. Horbach, 189 Neb. at 480-81 (ellipsis in original) (internal citations omitted).
This decision was later codified in Neb. Ct. R. Disc. § 6-326(b)(2). The evidence at hand is akin to
insurance-agreement evidence in that it provides "a more realistic appraisal of a case" regardless of
whether the information is admissible or not. Walls, 189 Neb. at 480-81. Therefore, even if a judge
were to determine that the evidence is inadmissible, it should follow the Supreme Court's rules of
discovery for insurance agreements and hold that evidence of third-party payments will be allowed for
discovery despite its inadmissibility.
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3. Strong policy reasons support the discovery of this evidence.
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Issue 2:
Objection to Blanket Requests for Medical
Records (or Any Medical Records More than 10 Years
Old)
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• Neb. Rev. Stat. §27-504 creates a privilege between a patient and his or her physician.
• However, filing a personal injury claim waives physician-patient privilege to all information concerning the
health and medical history relevant to the matters which the plaintiff has put at issue. Vredeveld v. Clark,
244 Neb. 46 (1993). The court in this case cited to State ex rel Mapes v. District court, 250 Mont. 254,
822 P.2d 91 (1991), stating "plaintiff waives her physician-patient privilege to the extent necessary for
the defendant to discover whether plaintiff's current condition is the result of some other cause."
• Like other confidentiality privileges, this privileged communications between a patient and physician can
be waived. "When a party claims damages for physical or mental injury, he or she places the extent of
that physical or mental injury at issue and waives his or her statutory right to confidentiality to the extent
that it is necessary for a defendant to discover whether plaintiff's current medical or physical condition is
the result of some other cause." State ex rel. Mapes v. Dist. Court of Eighth Judicial Dist. In & For Cnty.
of Cascade, 250 Mont. 524, 530, 822 P.2d 91, 94-95 (1991)
- 2 Examples
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BACKGROUND
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The type, nature and permanency of the injury are all relevant.
• For instance, The Supreme Court of Colorado has held general "garden variety" claims of general
pain and suffering may not be enough to discover a complete medical history. See Weil v. Dillon
Companies, Inc 109 P.3d 127, 130-32 (Colo. 2005) (holding “garden variety mental suffering claim”
raised in complaint did not inject plaintiff's mental.
• The test is whether the claimant significantly injected his physical and mental condition as the basis
of his claim. Hoffman, 87 P.3d at 863–64; Johnson, 977 P.2d at 157; Clark, 668 P.2d at 10. This is
determined on a case-by-case inquiry into “the cause and extent of the injuries which form the basis
for a claim for relief.” Samms v. Dist. Court, 908 P.2d 520, 525 (Colo. 1995) (citing Clark, 668 P.2d
at 10. Weil., 109 P.3d 127, 131 (Colo. 2005)
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Step One: Determine the nature of Plaintiff's damage claims to determine the
extent to which Plaintiff's medical history is "at issue".
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Step Two: Determine the Nature of the Objection.
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Assuming you can clear the first hurdle and establish that the Plaintiff's medical condition is "at issue",
there are three possible grounds for objecting to a complete medical history:
1.
Overbroad and Unduly Burdensome
2.
Not Calculated To Lead to Discovery of Admissible Evidence
3.
Privacy Grounds
Make sure to pin the Plaintiff down because objections often combine and confuse these factors.
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Responding to "Overly Broad and Unduly Burdensome" Objections.
The purpose of this objection is to prevent broad discovery requests where the burden and expense of
responding to discovery outweigh the likely benefits of that discovery.
NOTE: The Plaintiff in a personal injury case bears no burden and no expense in responding to one
of these subpoenas.
ALSO NOTE: Most medical records custodians have internal records retention policies which limit the
breadth of discovery.
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Responding to "Not Calculated to Lead To the Discovery of Admissible Evidence".
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Depending on the nature of the injury claimed, this is an easy argument to make. (Example)
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Tougher cases (no permanency, singular injury)
i) Prior records can be relevant to causation
ii) Holistic approach to medical history
A complete medical history is necessary to understand the claimant's pain and suffering. See Personal Injury Forms:
Discovery & Settlement. John A. Tarantino, David J. Oliveria, James Publishing (1985) citing Dar. et. al "The Effect of
Past Injury Pain on Threshold and Tolerance," 60 Pain 189 (1995) See also Jones & Subar, Proving What Seems
Unprovable," 32 Trial 12 at 47.49 (December 1996) describing ways to prove client's pain and suffering at trial,
including the importance of obtaining a complete medical history."
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"The mischief of an arbitrary time limit, such as five years preceding the incident alleged in the complaint, should be
obvious. A claim of permanent disability as a result of lower back problems asserted ten years before an accident is
far more relevant to a personal injury claim alleging damage to the inter-vertebral discs and related nervous system
than a back strain two years preceding the accident. Likewise, that a physician diagnosed a herniated disc at the L45 level of the lumbar spine twelve years before the incident is highly relevant to a plaintiff who claims that she
herniated her disc at L4-5 as a result of a motor vehicle accident." "Privacy vs. Honesty – The Necessity of Full
Disclosure of Medical Records" Illinois Association of Defense Trial Counsel - By: James E. DeFranco and Darrell J.
Flesner DeFranco & Bradley, P.C., Swansea.
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Responding to Objections Based on Privacy Issues.
Privacy concerns are secondary once a Plaintiff puts their medical condition "at issue".
Play your trump card: agreeing to a protective order should short circuit this objection.
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Final Words On These and Other Discovery Disputes:
Courts should err on the side of allowing discovery.
• The discovery rules were broadly written so as to allow discovery of any relevant matter not
privileged. State ex rel. Acme Rug Cleaner, Inc. v. Likes, 256 Neb. 34, 41, 588 N.W.2d 783,
787 (1999).
• The Nebraska Supreme Court has stated that “relevancy” for discovery is broader than
relevancy for trial. Stetson v. Silverman, 278 Neb. 389 (2009). Information must appear
reasonably calculated to lead to discovery of evidence. The primary purpose of the
discovery process is to explore all available and properly discoverable information to
narrow the fact issues in controversy so that a trial may be an efficient and economical
resolution of a dispute. . . . The discovery process also provides an opportunity for pretrial
preparation so that a litigant may conduct an informed cross-examination.
2.
Prejudice is Key
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