Monday, February 18, 2013

Bad Drivers Shouldn’t Profit Off of Good Drivers’ Health Insurance

Frank Pasternak

By Frank Pasternak

Imagine a law that will only benefit those people who do not have any health insurance and wrongdoers.

Well on February 13, Sen. Paul Farrow (who represents an area of Waukesha County that includes Pewaukee, Delafield, Hartland and Waukesha) and Sen. Glenn Grothman (who represents an area near West Bend and parts of northern Ozaukee County, including Port Washington and Cedarburg) did more than just imagine it; they introduced it. It’s Senate Bill 22, a law that would eliminate a long-standing rule of law in Wisconsin called the “collateral source rule.”

Basically, the rule says that benefits an injured person receives from sources that have nothing to do with the wrongdoer or “bad guy” causing the injury may not be used to reduce the bad guy's liability to the injured person. In other words, bad guys don’t get credit for benefits the injured person received just because the injured person was insured. This has been the law of Wisconsin for about 100 years.

The simple truth behind the rule is clear: wrongdoers should not benefit from the fact that the person they wronged was responsible enough to get insured. Unfortunately, however, as with many things, politics seems to have gotten in the way. Somehow, liability insurance companies like American Family, West Bend and others have convinced law makers, like Farrow and Grothman, that the bad guys should benefit from the fact that the injured person was responsible.

The law Farrow and Grothman have introduced will basically harm senior citizens, people who get insurance through their employer, and those on Medicaid. Ironically, the people who benefit from this law are those who do not have any health insurance and wrongdoers.

Let me explain: Say there’s a car accident where the wrongdoer ran a red light and caused four different people to incur $100,000.00 in medical bills each. All four suffered the same injuries and needed the same medical treatment. However, Victim #1 had no insurance, Victim #2 had Anthem BCBS through his employer, Victim #3 is a senior citizen on Medicare, and Victim #4 is a poor person on Medicaid.

Farrow and Grothman’s proposed law will allow into evidence the fact that Victim #2’s Anthem BCBS paid 80% of the bills due to contractual write-offs, the fact that Victim #3’s Medicare paid 60% of the bills, and Victim #4’s Medicaid paid 40% of the bills. As a result of Farrow and Grothman’s proposal, the recovery for medical bills will likely be:
  1. Victim #1 $100,000 (the uninsured guy)
  2. Victim #2 $80,000 (Employee with employer-sponsored health insurance)
  3. Victim #3 $60,000 (Senior citizen with Medicare)
  4. Victim #4 $40,000 (Poor person with Medicaid)
Now remember, the amount of the bills for all four people was the same $100,000. They all suffered the same injury in the same accident, but because of Farrow and Grothman’s proposed law, the bad guy causing the accident gets the benefit of the fact that Victim #2 was an employee with employer-sponsored health insurance, Victim #3 was a senior citizen on Medicare, and Victim #4 was a poor person on Medicaid. The other beneficiary of the proposed law would be Victim #1, the uninsured.

Under the current law, the red-light-running driver must pay the reasonable value of the injuries he caused, $400,000. Under the new proposal, the driver running the red light-will likely only pay, $280,000.

Under Wisconsin law today, the bad guy causing the accident does not get the benefit. The bad guy is simply responsible for the amount of the bills, assuming it is reasonable, and the only person who benefits is the person responsible enough to have insurance, the collateral source. Wisconsin law today says, rightfully, that bad guys do not get to benefit from good guys having insurance. The law today says that if anyone in this situation should benefit, it is the one who did not cause the accident. Surely, the one who caused the accident should not benefit.

Sadly, however, politics makes strange law, but I hope that’s not the case here. I believe in better. You deserve better. Sen. Grothman and Sen. Farrow should not support this law.

Email Sen. Paul Farrow at Sen.Farrow@legis.wisconsin.gov and Sen. Glenn Grothman at Sen.Grothman@legis.wisconsin.gov and tell them why they should not support this law. Tell Sen. Grothman and Sen. Farrow that this attempt to change Wisconsin’s 100-year-old law is unfair to Wisconsin citizens who are responsible enough to get health insurance.

The original version of this article is at Stand Up for Your Rights Wisconsin

Wisconsin Personal Injury Lawyer