Georgia Court of Appeals Holds that Doctor’s Interest in Outcome is Fair Game on Cross-Exam

The Georgia Court of Appeals has held that a doctor’s lien is fertile ground for cross-examination. In the case of Stephens v. Castano-Castano, the plaintiff sued for injuries arising out of a motor vehicle accident. The evidence showed that her attorney referred her to a treating physician who, in turn, treated her under the terms of a lien based on her recovery. Attempts at presuit settlement ultimately resulted in no settlement (and part of the decision deals with offers and acceptance), so a lawsuit was filed.

At trial, the defense sought to cross-examine the treating physician on the fact the attorney referred the plaintiff to him and his lien. Plaintiff moved to exclude the evidence, which was granted.

The Court of Appeals reversed, holding that the trial court should have permitted the defense to cross-examine the doctor based on the financial interest. The Court wrote:

“Dr. Chappius’ financial interest in the outcome of the case is highly relevant to the issue of his credibility and potential bias, as Dr. Chappuis has become an investor of sorts in the lawsuit. If Castano receives a large verdict amount, then Dr. Chappuis has a near certain chance of fully and quickly recovering the costs of the treatment provided to Castano at no initial cost. On the other hand, if Castano does not recover at trial, Dr. Chappuis’ chances of being fully reimbursed are more doubtful. Thus, the expert witness has a financial motivation to testify favorably for Castano, and the probative value of this testimony outweighs its prejudicial effect.”

The Court rejected the notion that the attorney’s referral was fair game, however. In so ruling, the Court wrote that “[a]t most, there is a suggestion of unseemliness which creates a danger of unfair prejudice and confusion of the issues before the jury.”

The case is Stephens v. Castano-Castano, 2018 Ga. App. LEXIS 307.

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Georgia Supreme Court Reverses Trial Court for Wrongly Giving an Ordinary Negligence Charge in a Medical Malpractice Case

On March 5, 2018, the Georgia Supreme Court reversed a $22 million verdict in a medical malpractice case, finding that the trial court had erroneously charged the jury on ordinary negligence.  On March 5, 2018, the Georgia Supreme Court reversed a $22 million verdict in a medical malpractice case, finding that the trial court had erroneously charged the jury on ordinary negligence.

On September 16, 2008, patient Ms. Brown had an epidural steroid injection administered by an anesthesiologist at a surgery center.  Ms. Brown was given the sedative Propofol prior to the procedure.  Her blood oxygen level was 100 percent when the procedure began.

Shortly after the procedure began, a pulse oximeter used to monitor the patient’s blood oxygen level sounded an alarm, indicating a drop in Ms. Brown’s oxygen in her blood.  Technicians and nurses in the room made efforts to increase the oxygen level.   The anesthesiologist stated that the machine was malfunctioning and that Ms. Brown’s true oxygen saturation level and breathing was fine.

Ms. Brown failed to resuscitate following the procedure, and EMTs responded to the practice’s 911 call for help.  The anesthesiologist told Ms. Brown’s daughter-in-law and the physician who admitted her to the hospital that the procedure had gone fine and Ms. Brown was simply having complications coming out of the anesthesia.  The anesthesiologist gave no indication that Ms. Brown might have experienced respiratory complications during the procedure.

Plaintiff’s counsel asserted both medical malpractice and ordinary negligence claims, including that the anesthesiologist improperly administered Propofol without positioning another anesthetist at the head of the table, failed to respond appropriately when the patient experienced respiratory distress and failed to contact emergency medical services promptly.

The trial judge charged the jury on both ordinary negligence and medical malpractice.

The Court of Appeals had concluded that the trial court charged correctly on ordinary negligence because a lay person would not need expert testimony to understand the meaning of data provided by pulse oximeters and blood pressure monitors and how best to respond to that information in the midst of a medical procedure.

The Georgia Supreme Court accepted certiorari and framed the issues as:  1) whether the trial court’s instruction on ordinary negligence was proper, and 2) if not, whether that error was harmful to the defendants.  The Supreme Court concluded that the ordinary negligence charge was improper and harmful to the defendants, ordering a retrial.    The Supreme Court disagreed with the Court of Appeals’ finding that responding to medical data from medical devices did not require medical judgment.

The case is Southeastern Pain Specialists, P.C. v. Brown, et al., Georgia Supreme Court No. S17G0733, decided March 5, 2018.

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Eleventh Circuit Court of Appeals Permits Introduction of Evidence of Litigation Funding

In a much anticipated decision, the 11th Circuit, in Houston v. Publix Super Markets, Inc., 2018 U.S. App. LEXIS 2935 (11th Cir. Feb. 7, 2018), held that a district court did not err in admitting evidence at trial concerning payments made by a litigation funding company to the plaintiff’s treating doctors because the evidence was relevant to show bias on the part of the doctors who testified in the case.

Plaintiff Robin Houston sued Publix Super Markets after she slipped and fell in one of its stores.  She subsequently underwent treatment for her injuries from a number of providers, which treatment was largely funded my ML Healthcare, a “’litigation investment’ company that contracts with doctors to provide medical care for injured people with viable tort claims who lack medical insurance.”  Houston, 2018 U.S. App. LEXIS 2935, at *2.  During the litigation, Publix conducted discovery regarding the relationship between Plaintiff, her treating doctors, and third-party ML Healthcare.  Publix learned that, pursuant to its contracts, ML Healthcare purchases at a discounted rate from these physicians the medical debt that the putative plaintiffs incur during their treatment.  The contracts also grant ML Healthcare the right to later recover the full cost of the medical care provided out of any subsequent tort settlement or judgment the treated individuals receive.

Publix sought to introduce at trial evidence of these contractual relationships to show that Plaintiff’s treatment providers were biased in their testimony and that Plaintiff’s claimed medical expenses were unreasonable.  Plaintiff sought to exclude this evidence, arguing, primarily, that it was barred by Georgia’s collateral source rule.  That rule generally gives a plaintiff the right to recover damages undiminished by collateral benefits, the rationale being that a defendant should not benefit from a plaintiff’s mitigation of her losses.  Polito v. Holland, 258 Ga. 54, 55 (1988).  The collateral source rule usually serves to render evidence of litigation funding, for instance, inadmissible when it’s offered in an effort to reduce damages.  Id. at 56.  In Houston, however, Publix argued that the arrangement between Plaintiff, ML Healthcare, and non-party providers created a risk of bias on the part of the doctors, who receive referrals from ML Healthcare and who subsequently testify on behalf of the plaintiffs they have treated pursuant to those referrals.  If a doctor did not provide a favorable causation opinion – necessary to win the case – ML Healthcare likely would find other doctors who would.  Houston, 2018 U.S. App. LEXIS 2935, at *15.  Finding that such proffer, i.e. establishing bias, was distinctly non-substantive in nature, the Court held that, procedurally, an evidentiary purpose was served by the admission of the evidence, such that the collateral source rule would not prohibit the jury from hearing of ML Healthcare’s role in the litigation.

Much like the recent state court decision in WellStar Kennestone Hospital v. Roman, 2018 Ga. App. LEXIS 34 (Ga. App. Jan. 30, 2018), the 11th Circuit has now limited plaintiffs’ use of the collateral source rule to hide the interplay of non-parties’ financial gambling in litigation.  However, the Houston Court has taken it a step further than the Roman decision did.  Not only is evidence of litigation funding discoverable, it may also be admissible if an evidentiary purpose is served by its introduction.  The significance of this ruling cannot be overstated.  The Houston Court did decline to consider whether evidence of ML Healthcare’s contract rates could be used to attack the reasonableness of Plaintiff’s claimed damages, but the path has certainly been paved for the defense bar to make this argument in the future.  The Houston case discusses Alabama’s comparable collateral source rule and, in a footnote, mentions that recent legislative changes in Alabama now permit the introduction of evidence that a plaintiff’s medical bills have or will be paid.  Perhaps Georgia will one day follow suit.  I attended a seminar recently where we were encouraged to keep attacking these issues at the trial court level with the hope that eventually the Georgia legislature will come around.  If nothing else, perhaps decisions like Houston and Roman will discourage the ever rampant medico-legal loop driving personal injury litigation.

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Tennessee Supreme Court Holds That Full and Undiscounted Medical Bills may be Submitted as Proof of Reasonable Medical Expenses

The Tennessee Supreme Court has issued its long-awaited decision in the Dedmon v. Steelman case. This case has direct and significant consequences to personal injury litigation in Tennessee. In short, defendants may not argue that the amount actually received by a medical provider is the reasonable amount of a plaintiff’s medical bills.  Plaintiffs may submit undiscounted medical bills in full as proof of reasonable expenses.

The Tennessee Supreme Court granted an appeal in Dedmon to address whether its ruling in West v. Shelby County Healthcare Corp., 459 S.W.3d 33 (Tenn. 2014) applies in personal injury cases. In West, the court held that a hospital’s reasonable charges under Tennessee’s hospital lien statute are the amount the hospital accepts from the patient’s private insurer, not the full amount of the medical bills sent to the patient.

The Supreme Court released its decision on November 17, 2017.  The court held that the collateral source rule applies to personal injury claims in which the collateral benefit at issue is private insurance. Consequently, plaintiffs may submit evidence of the injured party’s full, undiscounted medical bills as proof of reasonable expenses. Furthermore, defendants are precluded from submitting evidence of discounted rates accepted by medical providers from an insurer in order to rebut the plaintiff’s proof that the full, undiscounted charges are reasonable.

The court reasoned that to allow defendants to submit discounted rates would conflict with the collateral source rule. However, defendants remain free to submit any other competent evidence to rebut a plaintiff’s proof on the reasonableness of medical expenses, so long as that evidence does not conflict with the collateral source rule.

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Georgia Court of Appeals Affirms Exclusion of Doctor’s Substance Abuse

In a lengthy ruling covering many issues related to a trial, the Georgia Court of Appeals affirmed the exclusion of a doctor’s past substance abuse issues on the grounds of relevance. In the case of Doherty v. Brown, et al., issued on November 18, 2016, the Court addressed numerous issues arising out of a $22 million verdict against a pain physician and his practice group. The Plaintiff claimed that the doctor’s past substance abuse issues went to the question of “patient safety.” The doctor moved in limine and the trial court granted the motion. When Plaintiff attempted to bring it up at trial, the doctor objected and the trial court sustained the objection. On appeal, Plaintiff claimed the evidence should have been admitted. The Court disagreed, holding that the trial court properly exercised its discretion to exclude the evidence because there was no proof the doctor was impaired at the time of the surgery at issue.

The take-home is that the appellate courts have repeatedly held that evidence of a physician’s past substance use or abuse is not relevant to the issue of malpractice unless there is proof of impairment at the time of the incident.

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Welcome to our Health Law & Regulation Update Blog!

Welcome to our blog! Through this blog, the members of the Health Care practice group at Carlock Copeland & Stair will share legislative, case law, regulatory, and administrative law updates and trends. We plan to cover topics such as medical malpractice, tort reform, HIPAA and medical privacy compliance, EMTALA compliance, and overpayment reviews, audits, and fraud matters. We hope you will check with us often to get the latest updates.

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Carlock Copeland Health Law and Regulation Update

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Carlock, Copeland & Stair, a civil litigation firm, has a reputation for forceful, creative and cost-effective advocacy on behalf of its clients. Formed in 1970 with five attorneys operating out of a downtown Atlanta office, we now have over 80 civil litigation attorneys handling legal matters across the Southeast from offices in Atlanta, GA, Charleston, SC and Chattanooga, TN.

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