Citation. 536 U.S. 934
Brief Fact Summary. The Appellee, Anderson (Appellee), was sent by the Appellant, Montgomery Ward & Co., Inc. (Appellant), to the University of Arkansas for Medical Sciences (UAMS) hospital for treatment, after she fell at Appellant’s store. Appellee reached an agreement with UAMS, discounting her bill by fifty percent. Appellant moved to prohibit Appellee from presenting her total UAMS bill as proof of her medical expenses, Appellee claimed that the collateral source rule would prohibit Appellant from introducing evidence of the discount.
Synopsis of Rule of Law. The collateral source rule prevents the introduction of evidence of payments received by an injured party from sources collateral to the wrongdoer.
Issue. Was the trial court correct in determining that the forgiveness of a debt for medical services is a collateral source to be sheltered by the rule?
Held. Yes. Judgment affirmed.
* A trial court must apply the collateral source rule to exclude evidence of payments received by an injured party from sources collateral to the wrongdoer. This rule applies unless the evidence of the benefits from the collateral source is relevant for a purpose other than the mitigation of damages.
* In a previous case [Bell v. Estate of Bell, 318 Ark. at 490, 885 S.W.2d at 880 (1994)], this same Court found that although the defendant argued that the collateral source rule is inequitable because it results in double recovery for the plaintiff, public policy supports the rule because the plaintiff, rather than the alleged torfeasor, should be entitled to the benefit of the collateral source. This is especially true due to the fact that the claimant has usually incurred the detriment of the collateral source, in the form of things such as paid insurance premiums or lost sick leave. The Court finds that the policy allowing for the collateral source rule is equally applicable in the present case.
Discussion. The Court pointed out four situations in which the collateral source rule is inapplicable: (1) to rebut plaintiff’s testimony that he was compelled by financial necessity to return to work prematurely or forego additional medical care; (2) to show that the plaintiff had attributed his condition to some other cause, such as sickness; (3) to impeach plaintiff’s testimony that he had paid his medical expenses himself; (4) to show that the plaintiff actually continued to work instead of being out of work.