Cox et al v. KLS Martin, L.P.

Filing 124

ORDER and OPINION granting 104 Plaintiff's Motion for Order Regarding Value of Medical Treatment ; granting 106 Defendant leave to present exhibits of amounts accepted by medical providers and granting defendant leave to amend exhibit list. Signed on 08/13/2012 by District Judge Ortrie D. Smith. (Will-Fees, Eva)

IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
WESTERN DIVISION
CHAD COX and COURTNEY COX,
Individually and as Natural Guardians
of J.C.,
Plaintiffs,
vs.
KLS MARTIN, L.P.,
Defendant.

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Case No. 10-1204-CV-W-ODS

ORDER AND OPINION (1) GRANTING PLAINTIFFS’ MOTION FOR ORDER
REGARDING VALUE OF MEDICAL TREATMENT, (2) GRANTING DEFENDANT
LEAVE TO PRESENT EXHIBITS OF AMOUNTS ACCEPTED BY MEDICAL
PROVIDERS AND (3) GRANTING DEFENDANT LEAVE TO AMEND EXHIBIT LIST
The parties have filed competing motions predicated on section 490.715 of the
Revised Missouri Statutes. The Court concludes that (1) Plaintiffs are permitted to
present evidence of the amount billed by medical providers for the medical services
rendered and (2) Defendant is permitted to present evidence of the amount accepted by
those medical providers. Defendants is further granted leave to amend its Exhibit List to
include business records from Children’s Mercy Hospital.
The statute permits parties to “introduce evidence of the value of the medical
treatment rendered to a party that was reasonable, necessary, and a proximate result of
the negligence of any party.” Mo. Rev. Stat. § 490.715.5(1). There is a “rebuttable
presumption that the dollar amount necessary to satisfy the financial obligation to the
health care provider represents the value of the medical treatment rendered.” Id. §
490.715.5(2). At any party’s request, the Court shall “determine . . . the value of the
medical treatment rendered,” but in no event shall evidence of the collateral source of any
payments be made known to the jury. Id.1

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The statute does not require a hearing; it only requires that the Court “determine”
the value of medical services. Even if the statute required a hearing, such a requirement
would be procedural in nature and thus not binding in federal court.

While the statute directs the Court to “determine” the value of medical treatment,
the Missouri Supreme Court has held this provision does not permit the Court to
conclusively decide the amount of reasonable medical expenses. Deck v. Teasley, 322
S.W.3d 536, 541-42 (Mo. 2010) (en banc). Instead, the Court is only to decide whether
the presumption has been rebutted; if it has been rebutted, all admissible evidence
regarding value is presented to the jury “as if no presumption exists.” Id. at 539-41. The
presumption is rebutted if the plaintiff presents “substantial evidence,” which is defined to
be evidence that, if believed, has “probative force” on the issues. Id. at 540.
The statute provides a non-exhaustive list of factual matters to consider in
determining whether the presumption has been rebutted, including (1) the medical bills
incurred, (2) the medical bills paid, and (3) the unpaid amount that the plaintiff will be
“obligated to pay to any entity” in the event of a favorable verdict. Other factors
recognized, or testimony accepted, by Missouri courts as rebutting the presumption
include: whether the amounts charged are customary and reasonable, whether the health
care provider typically attempts to recover the full amount of the bill, and the extent to
which the amount accepted represents the value of the medical services. Deck, 322
S.W.3d at 540-41; Wheeler v. Phenix, 335 S.W.3d 504, 518 (Mo. Ct. App. 2011);
Montgomery v. Wilson, 331 S.W.3d 332, 340 (Mo. Ct. App. 2011).
Here, Plaintiffs have submitted an affidavit from Karen Austin, who is a billing
records custodian at Children’s Mercy Hospital. In her affidavit, Austin states that her job
duties include “participat[ing] in the process of billing patients for various services” and
that the amounts charged to Plaintiffs “are the amounts routinely charged by this facility
during the relevant time period for the services described therein. These amounts are
reasonable in that they are similar to and competitive with the amounts that similar
medical facilities charge for similar services at this time and place.” Austin’s affidavit is
very similar to the affidavits found acceptable in Wheeler. While there were nine such
affidavits in Wheeler, the contents of those nine affidavits were similar. 335 S.W.3d at
518.
Defendant counters with two arguments, the first of which does not address the
contents of Austin’s affidavit. Defendant contends Plaintiffs failed to comply with
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Missouri’s statutory provisions governing the mechanics for submitting affidavits to rebut
presumptions. Specifically, section 490.525.4 requires that affidavits used to rebut
presumptions be provided to opposing counsel at least thirty days before trial
commences. However, to the extent the statute purports to impose time limits or
requirements, the statute is procedural and not substantive and is not controlling in
federal court. In addition, since the filing of Defendant’s response, the parties have
agreed that the trial must be continued for reasons unrelated to this issue. Thus,
Austin’s affidavit has been filed within the time limits delineated in section 490.525.4.
Defendant’s second argument contends Plaintiffs lack expert testimony that is
necessary to demonstrate the reasonableness and necessity of the procedures
themselves. Austin states the services were ordered by a doctor, which she is permitted
to say -- but Austin is not a doctor and therefore is not qualified to state the services were
medically necessary. Defendant is correct in arguing that Plaintiffs must prove the
medical services were necessary in light of Defendant’s conduct; Plaintiff’s concede this
point. E.g., Plaintiff’s Suggestions in Support (Doc. # 104) at 5 n.2. However, this
obligation arises at trial, not at this juncture. If no such evidence is presented at trial,
then Plaintiffs cannot recover any medical expenses and evidence regarding the amount
of the medical expenses becomes irrelevant and inadmissible. Plaintiffs’ ability to
recover medical expenses is not an issue before the Court; the only issue is this:
assuming Plaintiffs are able to recover such expenses, may Plaintiffs offer the amounts
originally billed as proof of the amount of those expenses? The Court answers this
question in the affirmative.
Defendant’s motion argues that if the Court concludes Plaintiffs are entitled to offer
the original bills in evidence, then it must be allowed to offer evidence of the amount
Children’s Mercy Hospital accepted in satisfaction of the medical bills. On this point, the
parties and the Court agree. Defendant’s request to amend its Exhibit List to include
relevant documents is granted.
Defendant also uses this argument as a vehicle to also argue that only medical
records from the date the broken distraction device was discovered (June 18, 2009) to the
date J.C. was discharged after the broken distraction device was repaired (June 30,
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2009). Defendant bases its argument on the Court’s April 11, 2012, Order, but that
Order does not specifically address the “start date” for medical damages. Plaintiffs
probably incurred few medical expenses for treating a condition that was not yet known to
exist – particularly given that Plaintiffs are not seeking (and cannot recover) damages for
the necessary procedures associated with the implantation and explantation of the
distraction device. That said, it is possible there are such expenses: for instance,
diagnostic tests designed to ascertain the problem might have been conducted before it
was actually determined that the implant was defective. Regardless, while a
contemporaneous objection based on relevance may be well-taken, the present motions
are not the appropriate mechanism for resolving this issue.
The Court grants both parties’ motions. The Court concludes the presumption
described in section 490.715 of the Revised Missouri Statutes has been rebutted, and
both sides may present the jury with evidence bearing on the reasonable value of
Plaintiffs’ medical expenses. Defendant is also granted leave to amend its Exhibit List to
include documents obtained from Children’s Mercy Hospital showing the insurance
adjustments and the amounts accepted in full satisfaction of services provided to J.C..

IT IS SO ORDERED.

/s/ Ortrie D. Smith
ORTRIE D. SMITH, SENIOR JUDGE
UNITED STATES DISTRICT COURT

DATE: August 13, 2012

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