On Monday, November 23, 2009, the Court of Appeal in San Diego issued a published opinion applying the "collateral source rule" as a basis for rejecting the "Hanif" reduction of the medical damages recoverable in a personal injury case. (Howell v. Hamilton - filed November 23, 2009) Cal.App.4th (D053620).

The Court reasoned that the right to a reduction contained in the medical insurance contract was a "benefit" that had been procured by plaintiff and thus constituted a collateral source.

The "Hanif" reduction generally allows Plaintiff to introduce into evidence the "billed" amount of medical specials, in part, for the jury to consider as one factor to consider in awarding general damages.  Post-verdict, the trial court will reduce the medical specials awarded to only the amount "actually paid" to the health care provider(s) by health insurance.

Howell would apply to private pay insurance cases only and the decision itself cannot overrule Hanif or Nishihama because it is a court of co-equal jurisdiction, but it will tend to throw the cases into turmoil.

Therefore, this case is likely to be reviewed by the California Supreme Court so there is a single authority on the issue.  However, the earliest the California Supreme Court would likely make any such decision is early 2011, which still puts the issue at the forefront of all Bodily Injury (BI) cases for at least the next 12 months.

If and when the case is before the California Supreme Court, we will work with the Northern California Association of Defense Counsel in preparing an amicus letter and brief to the Court.

If you have any questions on this case, please contact us at info@vanlevylaw.com