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Despite 2017 Amendment to Statute, Court of Appeals Holds Section 490.715 Fails to Preclude Evidence of "Charged" Amounts of Medical Expenses at Trial

ABSTRACT: Court effectively negates statutory amendment intended to limit trial evidence to the actual cost of medical care.

In what was widely seen as an attempt to prevent plaintiffs from introducing evidence at trial of the full, undiscounted “amounts charged” for medical treatment, a revised version of § 490.715 was signed into law in 2017. It provides that “parties may introduce evidence of the actual cost of the medical care or treatment rendered to a plaintiff or a patient whose care is at issue.” See § 490.715(5)(1), RSMo. (emphasis added). “Actual cost” is defined as:

“a sum of money not to exceed the dollar amounts paid by or on behalf of a plaintiff or a patient whose care is at issue plus any remaining dollar amount necessary to satisfy the financial obligation for medical care or treatment by a health care provider after adjustment for any contractual discounts, price reduction, or write-offs by any person or entitySee § 490.715(5)(2) (emphasis added).

But in the recent case of Brancati v. Bi-State Development Agency, the Eastern District Court of Appeals held that evidence of the “amount charged” could still be introduced at trial, effectively rendering the revised version of § 490.715 meaningless. Brancati was a general liability case with stipulations that the “amount charged” for medical treatment totaled $77,515.48 while the actual “amount paid” to satisfy the financial obligation was $40,842.95. Before trial, Brancati filed a pre-trial Motion, arguing that the revised version of § 490.715 did not apply retroactively to this case. The trial court ruled that § 490.715.5, as amended, did not apply and that the parties could offer evidence of the value of medical treatment by allowing both the “amount charged” as well as the “amount paid” into evidence.

After a $625,000 adverse jury verdict, Bi-State appealed and argued, in part, that the revised version of § 490.715 applied retroactively to limit the evidence admissible regarding the cost of Brancati’s medical care to the “amount paid” and not the “amount charged.” 

The Eastern District affirmed the trial court and held that the revised version of § 490.715 did not eliminate the ability to introduce evidence of the “amount charged” for medical bills. The Court ruled that the statute did not expressly prohibit the introduction of “amounts charged” and merely permitted parties to introduce the “actual costs” of medical treatment. It also relied on Subsection 4, which provides that evidence admissible for “another purpose” may be introduced. Notably, the decision is devoid of any discussion about what other purpose was at issue to support the admission during trial of the “amount charged.” 

There are two other fundamental problems with the Eastern District’s decision, one dealing with legal and logical relevance, and the other with maxims of statutory construction. First, legal relevance requires a trial court to weigh the probative value of proffered evidence against its costs, such as unfair prejudice, confusion of the issues, misleading the jury, or wasting time. Reed v. Kansas City Missouri School District, 504 S.W.3d 235, 242 (Mo. App. W.D. 2016). Missouri courts have long held that a plaintiff may recover only those medical treatment expenses that he was liable to pay for the medical treatment, and actually incurred. See Cordray v. City of Brookfield, 88 S.W.2d 161, 164 (Mo. 1935); Zachary v. Korger, Inc., 332 S.W.2d 471, 475 (Mo. App. W.D. 1960). To allow the introduction of the full, undiscounted “amount charged” for medical expenses defies both basic principles of logical relevance (the evidence tends to make the existence of any material fact more or less probable than it would be without the evidence) and legal relevance. Evidence of the “amount charged” does not meet the litmus test of logical relevance because its introduction does not affect a plaintiff’s ability to recover the “amount paid” for medical treatment. Nor does it meet the litmus test of legal relevance because its probative value is far outweighed by the dangers of confusing the issue and misleading the jury. 

Second, this decision disregards the most basic canons of statutory construction. A fundamental principle of statutory construction is that a primary role of the courts in construing statutes is to “ascertain the legislature’s intent from the language used in the statute and, if possible, give effect to that intent.” State ex rel. Koehler v. Lewis, 844 S.W.2d 483, 487 (Mo. App. W.D. 1992). Under the “Reenactment Canon,” “when the Legislature amends a statute, it is presumed that the legislature intended to effect some change in the existing law.” State v. Liberty, 370 S.W.3d 537, 561 (Mo. banc 2012). This is because “to amend a statute and accomplish nothing from the amendment would be a meaningless act, and the legislature is presumed not to undertaken meaningless acts.” Id. By continuing to allow plaintiffs to introduce evidence of the “amount charged” for medical expenses, the Brancati court appears have rendered this legislative amendment meaningless. Further, in considering the landscape prior to the 2017 amendment, specifically that both the Eastern District and Missouri Supreme Court held that the “amount charged” for medical expenses could be introduced at trial, the language used in the 2017 statute clearly evinces an attempt to eliminate this practice. See Berra v. Danter, 299 S.W.3d 690 (Mo. App. E.D. 2009); Deck v. Teasley, 322 S.W.3d 536 (Mo. banc 2010). Likewise, this decision violates the canon that courts “must examine the language of the statutes as they are written [and] cannot simply insert terms that the legislature has omitted.” Loren Cook Co. v. Director of Revenue, 414 S.W.3d 451, 454 (Mo. banc 2013). 

A request that the Brancati case be transferred to the Missouri Supreme Court for review is presently pending.  Whether or not the Supreme Court takes the Brancati case, we are confident that we have not seen the last of litigation on this issue.