Coordination of Benefits              April 2011 | Vol. 19, No. 2 

If a person suffering from a chronic medical condition gets in an auto accident that exacerbates the condition, the evidence may not clearly indicate that the medical expenses paid for by the plan were caused by the accident. Between 1999 and 2004, a participant had back problems and had spinal fusion performed at the plan’s expense. In 2004, she was involved in a car accident, which was the other driver’s fault. Two years after the accident, her pain steadily increased and she had a spinal cord stimulator implanted, costing the plan $62,000. Very soon thereafter, she sued the driver who hit her in 2004 and settlement discussions ensued. The plan and its insurer sought recovery of benefits paid for the spinal cord stimulator. The court ruled against the plan, holding that a preponderance of evidence showed no relation between the 2004 accident and the need for the implant. Medical Condition Predated Accident, So Court Denies Reimbursement Claim 

It is not unusual for a person who is suffering from a chronic medical condition to be involved in an auto accident that exacerbates the condition. In those cases, when a self-insured ERISA health plan incurs expenses arising from the auto accident, it would typically have a right to reimbursement from any tort settlement or judgment that the plan participant achieves. In those cases, there would be clear medical evidence that the injuries exacerbated the pre-existing condition. 

However, in some of those cases, the evidence that the injuries arising from the auto accident may not clearly indicate that the accident was the event that caused the need for the medical expenses. And as is typical in such cases, there may be contradictory or unclear evidence regarding the effect of the accident on the pre-existing condition. 

A recent decision of a U.S. District Court in Illinois sheds some light on how such a case can be resolved. The case is Rotech Healthcare v. Huff, 2011 WL 873150 (C.D. Ill., March 8, 2011). 

The Facts

Synthia Ann Huff was an employee of Rotech Healthcare and was covered by its self-insured health plan. She had been experiencing back and leg pains since 1995, and in May 2004 underwent a spinal fusion. She had some residual pain following the surgery, but in September 2004, her doctor, Eric Potts, concluded that she had responded well to therapy and the spinal fusion was still present. At the time, she was covered by Rotech’s self-insured plan administered by Care First Blue Cross/ Blue Shield. There were no issues related to her medical expenses or coverage. 

On Oct. 24, 2004, she was involved in an auto accident caused by Robert Hawkins, who disregarded a stop sign and struck her vehicle. She was transported to a hospital where she was given treatment and released that evening. However, her pain increased and she was seen by Dr. Potts several times during 2004 and 2005. By June 2006, Potts concluded that the conservative treatment was not alleviating her pain, so he referred her to another doctor, Derron Wilson, from the group practice that was treating her. At that time, the Rotech plan had replaced the administrator with United Healthcare. In September 2006, Wilson implanted a spinal cord stimulator. The Rotech plan paid almost $62,000 for her treatment since July 1, 2006. 

On Sept. 21, 2006, Huff filed a lawsuit in state court against Hawkins seeking money damages for the injuries she sustained in the collision. In July 2007, she signed answers to interrogatories under oath, stating that she received services from her doctors and was unable to work on specified days from Oct. 20, 2004 through Jan. 25, 2007, and that she received payment from the Rotech plan for the injuries alleged in her complaint in the amount of almost $62,000. 

In a deposition taken in August 2008, Potts testified that he believed that the pain Huff had in October 2005 was related to the underlying disease she had before the collision. His opinion was that “none of the medical care that was provided to Huff after Jan. 1, 2005 was causally related to the automobile collision she was involved in on Oct. 20, 2004.” 

In a deposition also taken that day by Wilson, he said he thought that the motor vehicle accident aggravated her conditions, but when asked if he had an opinion based upon a reasonable degree of medical certainty on whether the collision Huff was involved in resulted in an aggravation of her pain, he said that it would be “speculation” to relate the need for the implant to the accident.

But when pressed further in his deposition on whether the accident aggravated her condition, he said, “I think it’s more likely than not to have aggravated her underlying symptoms.”

Based on this, Hawkins’ auto insurer offered to settle the tort claim for $25,000. Huff did not accept this offer, but moved to adjudicate the subrogation lien in the state court action. United Healthcare removed the case to the federal court to hear that motion. The court granted Huff’s motion to remand the case back to the state court. That led Rotech to file this case in the federal court on Oct. 1, 2009, and on Dec. 15, 2010, both parties moved for summary judgment. 

The Decision

The court concluded that based on the documents described above, there was no reasoned basis for a determination that the plan paid benefits to Huff for injuries sustained in the October 2004 accident that would require her to reimburse the plan for the benefits it provided. It said that such a determination could only have been made based on “selective readings.” It concluded that Wilson’s statement was speculation, and that Rotech’s reliance on it was “downright unreasonable.” It said:

This court concludes that there is no rational support in the record for Rotech’s choice to rely on Dr. Wilson’s vague, unspecified opinion rather than Dr. Potts’ opinion. Dr. Wilson testified that he could not give an opinion regarding whether the treatment he provided was necessary because of the collision because any such opinion “would be speculation.” 

It also concluded that Rotech’s reliance on Huff’s sworn answers to the interrogatories was also unreasonable. It said, Huff apparently sincerely believed that the treatment she received from the time of the accident to 2007 was caused by the accident. However, there is no reason to believe that Huff has any medical expertise. Following Dr. Potts’ deposition testimony, Huff had to re-evaluate her case and conclude that she could not recover for any treatment she received after the end of 2004 or for any pain and suffering and lost wages after the end of 2004. That is why she is now willing to settle her case for $25,000, if the lien is declared invalid. 

Rotech argued that Huff should be judicially stopped from changing the position she took in her answer to interrogatories. The court rejected this argument, pointing out that the doctrine is equitable and is “intended to protect the courts from being manipulated by chameleonic litigants who seek to prevail, twice, on opposite theories.” In order for judicial estoppel to apply, “the party to be estopped must have convinced the first court to adopt its position; a litigant is not forever bound to a losing argument.” 

Apparently, it was not enough to rely on find statements in an overall record to support a claim for reimbursement when the preponderance of the evidence leads to the conclusion that there was no relation between the accident and the need for additional expensive treatment. 

The firm opinion of Potts that the accident was irrelevant to the need for the implant could not be offset by an admittedly speculative opinion to the contrary by a doctor who had not followed the patient beyond doing the implant surgery. 

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This entry was posted by cmonfils on Tuesday, May 3rd, 2011 at 7:43 pm and is filed under Subrogation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.