BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 1528|
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THIRD READING
Bill No: SB 1528
Author: Steinberg (D)
Amended: 5/15/12
Vote: 21
SENATE JUDICIARY COMMITTEE : 3-2, 5/8/12
AYES: Evans, Corbett, Leno
NOES: Harman, Blakeslee
SUBJECT : Damages: medical services
SOURCE : Consumer Attorneys of California
DIGEST : This bill seeks to establish a framework for
compensating injured persons, and provides that existing
lien rights and existing law regarding medical services
shall be maintained, as specified.
ANALYSIS : Existing law provides that every person who
suffers a loss or harm from the unlawful act or omission of
another, may recover from the person at fault monetary
compensation, which is called damages. (Civil Code (CIV)
Section 3281)
Existing law provides that damages may be awarded, in a
judicial proceeding, for loss or harm resulting after the
commencement of the judicial proceeding, or certain to
result in the future. (CIV Section 3283)
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Existing law provides that, for the breach of an obligation
not arising from contract, the measure of damages, except
where otherwise expressly provided, is the amount which
will compensate for all the detriment proximately caused
thereby, whether it could have been anticipated or not.
(CIV Section 3333)
Existing law, the collateral source rule, provides that
evidence of a plaintiff's collateral source of payment for
medical services, such as payment provided by an insurer,
should not be introduced to reduce the amount of
compensatory damages to be award to the plaintiff.
(Helfend v. Southern Cal. Rapid Transit Dist. (1970) 2
Cal.3d 1, 6)
Existing law provides that, in the event the defendant so
elects, in an action for personal injury against a health
care provider based upon professional negligence, he may
introduce evidence of any amount payable as a benefit to
the plaintiff as a result of the personal injury pursuant
to the United States Social Security Act, any state or
federal income disability or worker's compensation act, any
health, sickness or income-disability insurance, accident
insurance that provides health benefits or
income-disability coverage, and any contract or agreement
of any group, organization, partnership, or corporation to
provide, pay for, or reimburse the cost of medical,
hospital, dental, or other health care services. Where the
defendant elects to introduce such evidence, the plaintiff
may introduce evidence of any amount which the plaintiff
has paid or contributed to secure his right to any
insurance benefits concerning which the defendant has
introduced evidence. (CIV Section 3333.1.(a))
Existing law provides that no source of collateral benefits
shall recover any amount against the plaintiff, nor shall
it be subrogated to the rights of the plaintiff against a
defendant. (CIV Section 3333.1.(b))
Existing law permits a health care provider to assert a
lien against an injured person's recovery from a third
party who is liable for the injuries, but limits the
proportion of the recovery that may be subject to the lien.
(CIV Section 3040)
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Existing law establishes a procedure for a hospital to
place a lien upon the damages recovered or to be recovered
by an injured person from a third party liable for the
injury. (CIV Section 3045 et seq.)
This bill:
1.Declares the intent of the Legislature to establish a
framework for compensating persons with injuries.
2.Provides that, when a person is compensated for an injury
due to the fault of another, the lien rights provided CIV
Sections 3040 and 3045.1, the medical provider provisions
under CIV Section 3333.1, and existing law regarding
claims made against a public agency or of public entities
under Government Code Section 985 shall be maintained.
Background
Under existing law, individuals who have suffered injuries
caused by tortfeasors may bring an action against the
tortfeasor for recovery of damages, including medical
costs, to compensate the individual for these injuries.
Existing law, the collateral source rule, provides that
when measuring the plaintiff's damages, evidence of the
plaintiff's insurance coverage for medical services is
inadmissible when used to reduce the amount of compensatory
damages. The collateral source rule reflects the public
policy that the tortfeasor should not be allowed to escape
liability for the plaintiff's injuries.
A recent California Supreme Court decision, Howell v.
Hamilton Meats, Inc. (2011) 52 Cal.4th 541, held that proof
of the reasonable value of medical services paid for by the
plaintiff's insurer or rendered by the provider contracting
with the insurer is inadmissible when measuring the
plaintiff's compensatory damages.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 5/29/12)
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Consumer Attorneys of California (source)
County of Los Angeles
OPPOSITION : (Verified 5/29/12)
American Insurance Association
American International Group
Association of California Insurance Companies
California Assisted Living Association
California Association of Bed and Breakfast Inns
California Association of Health Facilities
California Chamber of Commerce
California Defense Counsel
California Hotel & Lodging Association
Civil Justice Association of California
Cooperative of American Physicians
CSAC Excess Insurance Authority
National Association of Mutual Insurance Companies
Pacific Association of Domestic Insurance Companies
The Doctors Company
ARGUMENTS IN SUPPORT : The author writes:
It is a goal of our tort system to ensure that injured
people are compensated. Although plaintiffs have an
existing right to sue and the collateral source rule
precludes a deduction of compensation to the injured
party for amounts paid by the injured party's insurer,
a recent California Supreme Court decision, Howell v.
Hamilton Meats, Inc. , 52 Cal.4th 541 (2011), created
uncertainty as to the measure of compensation. The
Howell court held that proof of reasonable value of
medical services paid for by the injured party's
insurer or rendered by the provider contracting with
the insurer is not admissible when measuring the
plaintiff's compensatory damages.
Howell brought up other issues regarding third party
compensation related to plaintiff injury cases,
including: How does Medi-Cal recover costs? How are
providers affected? How are county governments who
provide needed services to their community affected?
How are our public Hospitals affected?
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Because of the variety of stakeholder interests in
injury awards, the author has committed to working with
all affected stakeholders to find a reasonable solution
for all affected parties. This bill is not intended to
impact MICRA �Medical Injury Compensation Reform Act].
JJA:do 5/29/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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