Appeals court will determine if collateral payment evidence admissible
in medical malpractice case
Case law does not address the specific question of whether a defendant
can introduce evidence that a plaintiff received "collateral
source" payments, such as life insurance proceeds, when the
jury is not deciding the damages amount in a medical malpractice action.
That issue is currently before a Wisconsin appeals court.
By Joe Forward, Legal Writer,
State Bar of Wisconsin
Sept.
23, 2010 – A Wisconsin appeals court will decide whether evidence
that a widow received a $1.4 million life insurance payout and large
monthly Social Security payments should have been admitted in a medical
negligence trial against three Door County physicians.
In 2009, a jury in Door County Circuit Court entered a judgment in
favor of the doctors, who were sued for medical negligence after William
Weborg died of sudden cardiac arrest in 2004. Weborg’s wife,
Theresa Weborg, and the Weborg children (collectively, Weborg) sought
money compensation for loss of society, companionship, and compensation
for financial losses.
In pretrial proceedings, the circuit court judge granted the
doctors’ motion to allow evidence that Weborg received $1.4
million in life insurance proceeds and Social Security death benefits of
$3,300 per month (collateral source payments) as a result of her
husband’s death.
On appeal, Weborg’s appellate counsel argues that evidence of
such payments “could have done nothing but prejudice the jurors
against Mrs. Weborg and her case” and “was not relevant to
any issue the jury would have to decide.”
The appellants’ call the case one of “first impression
regarding the application of Wis. Stat. section 893.55(7) related to
life insurance and Social Security payments.”
The doctors argue that such evidence was admissible because Wis. Stat.
section 893.55(7) explicitly allows a party to introduce evidence of
collateral source payments that were made to the plaintiff in actions to
recover damages for medical malpractice claims.
Section 893.55(7) states: “Evidence of any compensation for
bodily injury received from sources other than the defendant to
compensate the claimant for the injury is admissible in an action to
recover damages for medical malpractice.”
Weborg argues that under the Wisconsin Supreme Court’s
interpretation of section 893.55(7) in Lagerstrom v. Myrtle Werth
Hosp. – Mayo Health Sys., 2005 WI 124, 285 Wis.2d 1 700
N.W.2d 201, collateral source evidence is permissible, but not
mandatory.
The Wisconsin Supreme Court in Lagerstrom held that a circuit
court must instruct a jury that it cannot reduce the reasonable
value of medical services on the basis of collateral source payments,
but such evidence may be used to determine the reasonable value.
“The majority of the court [in Lagerstrom] interpreted
Wis. Stat. section 893.55(7) in a manner that does not allow evidence of
collateral source payments to be admitted the way it was in our
case,” counsel for Weborg wrote in a brief for the appellant.
Weborg’s counsel argued that section 904.01 requires that trial
evidence be relevant to the issues to be determined by the jury. The
life insurance and Social Security payments were not relevant, Weborg
argues, because the parties stipulated to damages of $1 million.
That is, the jury was not required to determine the amount of damages
in the event that Weborg was successful in establishing negligence.
The Wisconsin Association of Justice (WAJ) and the Wisconsin Medical
Society (WMS) filed opposing amicus curiae briefs in the case,
Weborg v. Jenny, 2010AP000258.
The WAJ sides with Weborg, arguing the doctors are “unable to
identify a single legitimate relevant purpose for admitting
evidence” of life insurance and Social Security payments and the
collateral source payment evidence was prejudicial.
Asserting that section 893.55(7) was enacted, in part, to curb rising
health care costs, the WMS argues that in light of the policies
underlying enactment, collateral source payments should never be
“deemed inadmissible on relevance grounds.”
“There can be no doubt that the evidence at issue here is within
the scope of section 893.55(7) and is admissible,” counsel for WMS
wrote.
