Uninsured Plaintiff Can Establish Fair and Reasonable Medical Expenses Through Physician Testimony Notwithstanding Howell v. Hamilton Meats

On June 22, the California Court of Appeal, Fourth District, issued its published opinion in Bermudez v. Ciolek (G049510) modifying an award of damages to an uninsured plaintiff for the reasonable value of past medical services based upon testimony from physicians that the expenses were fair and reasonable. The Court's ruling further clarifies an emerging issue in the computation of a plaintiff's billed versus paid damages following the California Supreme Court's ruling in Howell v. Hamilton Meats (2011) 52 Cal.4th 541 (Howell) [holding that an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more than the amounts paid by the plaintiff or his or her insurer for the medical services received or still owing at the time of trial].


In Bermudez, the plaintiff was an injured bystander when two vehicles collided and then hit him. At the time of the accident, plaintiff had no medical insurance. He was taken by ambulance to the hospital where he stayed four to five days. Plaintiff testified at trial that his outstanding medical bills were approximately $450,000. At trial, Plaintiff called several doctors as witnesses who testified as to the reasonableness of the charges for the medical procedures he underwent. With some nominal modifications, plaintiff's doctors testified that the medical charges were "fair and reasonable." Defendants also presented testimony from a doctor regarding the medical charges, who concluded that "some of the charges....were fine." The jury ultimately awarded plaintiff past medical expenses of $460,431, along with various other damages, totaling $3,751,969.

On appeal, the defendant argued that plaintiff (1) failed to meet his burden of proving that his claims for past and future medical damages were reasonable, as measured by an exchange or market value, and (2) plaintiff urged the jury to award noneconomic damages as a multiple of the improperly-grounded economic damages. In its opinion, the Court of Appeal repeated the rule announced by Howell; namely, that "a plaintiff may recover as economic damages no more than the reasonable value of the medical services received and is not entitled to recover the reasonable value if his or her actual loss was less." But, the Court of Appeal noted that Howell offered no bright line rule on how to determine "reasonable value" when uninsured plaintiffs have incurred (but not paid) medical bills.

Inasmuch as plaintiff in Bermudez was uninsured, the Court of Appeal held that the law regarding the computation of damages for uninsured plaintiffs was not changed by the holding in Howell and thus "the measure of medical damages is the lesser of (1) the amount paid or incurred, and (2) the reasonable value of the medical services provided." After a thorough discussion of Howell and its progeny, including Corenbaum v. Lampkin (2013) 215 Cal.App.4th 1308 [holding that the full amount billed for past services is not admissible as evidence of what the reasonable value of future medical services will be, nor is it relevant for purposes of determining noneconomic damages], the Court of Appeal ruled that medical testimony provided by the plaintiff's doctors that plaintiff's medical costs were fair and reasonable was sufficient to support the jury verdict (with narrow modification for the charges that plaintiff's own doctors conceded were improper).

Specifically, the Court held that, "[w]e reject [Defendant's] view that we must grant a new trial on damages or reduce the amount awarded to [Plaintiff] beyond the $46,175.41 reduction acknowledged above. This is not a case in which [Plaintiff] actually incurred a lower amount in medical costs than the initial billed amount. Nor is this a case in which [Plaintiff] simply declared that the incurred amount was reasonable. [Plaintiff] called two medical doctors to testify about the reasonable costs of procedures about which they were knowledgeable, including one expert who testified concerning the back surgery he performed himself. These experts did not merely rubber stamp all of the medical bills as reasonable; they identified lower numbers as reasonable in some cases. These doctors were qualified to provide expert opinions concerning the reasonable value of the medical costs at issue. This opinion testimony was based in part on the medical costs incurred by [Plaintiff] and in part on other factors considered by the experts, including their own experiences treating patients. This was not purely speculative evidence without any basis in the real world. . . [Plaintiff] actually suffered severe injuries and underwent expensive medical treatment. The evidence presented was sufficient to support an award of $414,255.59 in past medical damages."

The holding of the Court of Appeal in Bermudez is important because it substantiates the theory that an uninsured plaintiff can use the testimony of treating and expert physicians to support the amount of the medical expenses that were "billed" or "incurred" by the plaintiff as reasonable-even though the amounts that the plaintiff will actually pay on those bills will be a lesser sum. This holding seems to support the contention raised by many that uninsured plaintiffs will benefit at trial because their medical expenses will not be reduced by the amounts that were previously negotiated by insurers. In contrast with an insured plaintiff, who will have his/her economic damages reduced by Howell, and kept from the jury by Corenbaum, an uninsured plaintiff will be able to present the full "billed" medical expenses via the testimony of a qualified doctor, establish that those expenses are fair and reasonable, and potentially obtain a significantly larger jury verdict. Simply put, it may benefit a personal injury plaintiff to be uninsured.

This case is a reminder that defending a case with an uninsured plaintiff presents unique challenges, many of which must be dealt with at trial through effective and timely objections to testimony, which (according to the Court of Appeal) did not appear to happen in Bermudez