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LaFountaine's Successful Unprecedented Argument Saves Client $120,000 |
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 District Court Decision – Johnson v. Mid American Auction Co., Inc., is a District Court decision recently received in a case Quinlivan & Hughes attorney Michael D. LaFountaine is handling. The decision is of importance because it deals directly with the issue of whether the “gap” created by a discount taken by Medicare is treated the same as the “gap” created when a private insurer takes a discount off of total medical bills and the provider accepts partial payment in full satisfaction of those bills.
In Swanson v. Brewster, 784 N.W.2d 264 (Minn. 2010) the Supreme Court ruled that the “gap” is a collateral source and, therefore, does not provide a windfall to the plaintiff if a jury awards the total medical expenses to the plaintiff in its verdict. Rather, the “gap” created by the discount is written off from the total medical expenses awarded as a collateral source and not payable by the defendant to the plaintiff.
In the District Court Order issued by Judge Carlson, Seventh Judicial District, Todd County, the issue of whether the Medicare discount is the functional equivalent of a discount taken by a private insurer is answered. Judge Carlson ruled that it was and, as you can see in reviewing the Order, in that case resulted in a savings of over $120,000 to the defendant.
Plaintiffs’ attorneys argue that the Swanson v. Brewster decision is very narrow and limited in application and applies exclusively to payments made by private insurers. Judge Carlson disagreed and ruled in favor of Mr. LaFountaine’s client broadening the Swanson rule to include Medicare payments.
To our knowledge this is the first District Court decision dealing with Medicare under these circumstances.
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