I'm injured but I'm not sure how much I should get for my medical bills. What can I expect from the insurance company?
How does the state of Texas determine how much your insurance company is expected to pay for your medical bills when you suffer a wrongful personal injury?
According to Section 41.0105 of the Texas Civil Practice and Remedies code, you can recover the cost of your medical care at the rate it has been billed. This means the amount that was "paid or incurred," not what the doctor would otherwise charge if they didn't have a contract with insurance companies to accept a lesser amount for the services they provided.
If you have certain medical expenses, they must be considered "necessary and reasonable." But it has become trickier to define what costs are considered "reasonable."
"Health care providers set charges they maintain are reasonable while agreeing to reimbursement at much lower rates determined by insurers to be reasonable, resulting in great disparities between amounts billed and payments accepted."
Section 41.0105 says only the amounts charged or paid on behalf of the "claimant" may be awarded to the person injured. You would be the "claimant" if you had been injured and were seeking damages for your injuries.
In the case of Haygood v. Escabedo, the plaintiff's (Haygood) car was struck by the defendant's (Escabedo) car in a grocery store parking lot. The defendant was found to be at fault and the plaintiff sued her for damages.
The plaintiff required two surgeries for his personal injuries. He showed proof that his medical expenses from 12 separate doctors totaled $110,069.12. However, Haygood was covered by Medicare B, which "pays no more for medical and other health services than the ‘reasonable charge’ for such service."
Because of this, the doctors who treated Haygood adjusted their bills. They gave a credit of $82,329.69, which left a remaining balance of $27,739.43. When the trial began, a portion of the amount had been paid, leaving a balance of $14,482.02.
The jury sided with Haygood and determined his total expenses, including future medical care related to his injuries and mental pain and suffering, totaled $144,569.12.
The court of appeals overturned the verdict, citing Section 41.0105. The court found that "neither the claimant nor anyone acting on his behalf" would be responsible for paying the full amount of his actual care.
The case made it to the Texas Supreme Court, with Haygood using the collateral source rule. The "collateral source rule is a legal doctrine that holds that a defendant should not get the benefit of payment arrangements that might eliminate or reduce a claimant's out-of-pocket expenses."
However, the Supreme Court upheld the overturned verdict based on Section 41.0105 of the Texas Civil Practice and Remedies Code.
What does all this mean for you? If you have suffered a wrongful personal injury, you will only be able to recover what your insurance company has agreed to pay your doctors. No matter what type of insurance you have, you're still only allowed to collect the total of the costs "actually paid or incurred" on your behalf.