January 19, 2021

Medical Payments for Personal Injury Cases
A Two-Minute Read: 539 Words

In general, orthopaedic surgeons are paid for their medical care by commercial or government payers. In other cases, patients may not be insured by traditional health insurance and other payment arrangements would need to be made. 

The Texas Supreme court heard a case on January 5, 2021, regarding the issue of whether defendants in personal injury litigation are entitled to discovery of non-party treating physicians’ business records and commercial health insurance rate contracts. Legislation has already been introduced in the 2021 Texas Legislature (SB 207 in the Texas Senate) that would create a dramatic effect on what physicians can get paid in this type of work.

Orthopaedic surgeons will frequently treat patients who have been involved in injuries at work or in motor vehicle accidents who ultimately, either before or after treatment, file lawsuits, and these lawsuits may include medical costs. For some orthopaedic surgeons, personal injury cases are a routine part of the surgeon’s elective practice. For orthopaedic surgeons who handle trauma, these cases may inadvertently become a part of their practice. Ultimately, all physicians, hospitals, and ASCs could be impacted by both the Supreme Court Case and the bill in the Texas Legislature. 

The Texas Supreme Court Case
The Texas Supreme Court heard oral arguments regarding IN RE K&L AUTO CRUSHERS, LLC AND THOMAS GOTHARD, JR. on January 5, 2021, and if the Court decides against the orthopaedic surgeon, it would drastically affect what records are discoverable from physicians who treat patients involved in personal injury litigation. In these cases, physicians are a non-party, meaning they are neither the defendant nor plaintiff; instead, they have provided a service in the normal business of their practice.

The defendant sent subpoenas to the plaintiff’s medical providers seeking discovery of the physician's reimbursement rates with private insurers and government payers for the medical services and equipment billed by the providers to the plaintiff. 

Click here to view the oral arguments. Click here to view the case filings. Click here to view TOA’s amicus brief.

The Texas Supreme Court could rule whether physicians’ insurance contracts are discoverable at any moment. Or the Court could wait to offer a ruling until after the Texas Legislature concludes on Memorial Day to give the Legislature an opportunity to settle the issue through legislation.

Texas Legislature: January Through Memorial Day
Major legislation, SB 207, which would make physician rates discoverable and allow the courts to take into account government payer rates, has already been filed in the Texas Legislature.

Under SB 207, physicians and providers who end up treating patients involved in litigation would be required to provide their contracted health insurance rates to the courts. In addition, physicians would be required to produce a 12-month average of the amounts accepted in payment (whether in cash, write-off, or insurance payment) for all other patients in their practice who received the same or similar services. The proposed legislation is in direct opposition to the concepts found in the out-of-network balanced billing and surprise billing compromises from the 2019 Texas Legislature by allowing auto and business insurances to utilize government and private insurance rates as a benchmark for ultimate payment to physicians. 

TOA is leading the stakeholders in discussions to amend this legislation. Stay tuned.

Adam Bruggeman, MD
Past President | Texas Orthopaedic Association