Indiana Supreme Court Decides Patchett v. Lee

In Stanley v. Walker, the Indiana Supreme Court held that Indiana’s collateral-source statute permitted a defendant in a personal injury suit to introduce evidence of discounted reimbursements negotiated between the plaintiff’s medical provider and his private health insurer, as long as the defendant did not mention insurance. 906 N.E.2d 852 (Ind. 2009). 

On October 21, 2016, in Patchett v. Lee, 29S04-1610-CT-549, the Indiana Supreme Court extended its holding in Stanley to apply not just to payments between providers and private health insurers, but also to reimbursements by government payers, like the Healthy Indiana Plan (HIP).  

In Patchett, the defendant, Mary Patchett, admitted to negligent driving that resulted in serious injuries to the plaintiff, Ashley Lee.  Lee was enrolled in HIP.  On the one hand, Lee argued that to prove the reasonableness of her medical services, only a health-care payment that was transacted at arm’s length was admissible into evidence.  On the other hand, Patchett contended that the precedent in Stanley allowed any accepted health-care payment into evidence, whether that payment was negotiated or simply imposed. 
In this groundbreaking case, the Indiana Supreme Court reversed the holding of the trial court and Court of Appeals and held that a factfinder may hear evidence of the reduced amounts a provider accepts as full payments, even if the payer is a government healthcare program, like HIP.  

While not specifically addressing Medicare or Medicaid, we anticipate this ruling will also allow admission of those payments as “accepted reimbursements from government payers.” 
Click here for a full text of the opinion

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