TALLAHASSEE – The Florida Supreme Court has reversed a decision by an appellate court to include evidence of a plaintiff’s eligibility for future benefits under Medicare to determine future damages.

On Oct. 15, 2015, in Joerg v. State Farm, the High Court vacated the 2nd District Court of Appeal’s decision to grant State Farm’s request to use the claimant’s future Medicare entitlement to reduce the amount awarded for future medical expenses.

“This young man (Luke Joerg) was on Medicare disability, and as a result, his past medicals were the Medicare disability number,” William Large, president of Florida Justice Reform Institute, told the Florida Record. “The court said it was improper to rely on those numbers for future medical in trying to determine what the future medical (awarded) would be because the Medicare program itself might not always (be) available for this person.”

The High Court pointed out that in a previous case (Florida Physician’s Insurance Reciprocal v. Stanley) the court ruled that evidence of free or low-cost services to anyone with disabilities from government agencies is admissible in court to determine future damages, but that the common-law collateral source rule was limited to benefits “earned in some way by the plaintiff.”

Since Joerg did not contribute to his Medicare benefits, the court held that the appellate court’s decision that Joerg’s Medicare benefits are unearned and therefore inadmissible was incorrect.

In 2007, Luke Joerg was injured when he was struck by a vehicle while riding his bicycle. His father, John Joerg, filed a lawsuit against State Farm on behalf of his son for medical expenses Luke Joerg sustained as a result of the accident.

In accordance with the collateral source rule, John Joerg subsequently filed a motion to exclude evidence of any collateral source benefits Luke Joerg was entitled to, including discounted benefits under Medicare and Medicaid.

The collateral source rule prohibits evidence from being presented in court that shows a plaintiff received compensation from some source other than the damages sought against the defendant. The rule dates back to 1853 and aims to promote justice and hold defendants liable for their faults.

John Joerg’s motion was granted, but only in respect to past medical bills. John Joerg filed a motion to reconsider.

The trial court vacated its prior ruling and allowed State Farm to present evidence of future medical bills for specific treatment or services available “to all citizens regardless of their wealth or status.” The court, however, prohibited State Farm from presenting evidence of Luke Joerg’s future Medicare or Medicaid benefits.

Following a four-day trial, the jury awarded the plaintiff, $1,491,875.54 in damages, including $469,076 for future medical expenses

State Farm appealed the verdict, arguing that Luke, a developmentally disabled adult, was a recipient of Medicare benefits, and since Luke Joerg’s benefits were free and unearned, based on the Stanley decision, evidence of his benefits should not have been excluded. The 2nd District court agreed and reversed the jury’s verdict.

But the Florida Supreme Court disagreed and ruled that the appellate court misapplied the Stanley case.

“To affirm the decision (by the appellate court) below would result in a new trial in which State Farm would be permitted to present confusing, prejudicial, and speculative evidence of Luke Joerg’s future entitlement to Medicare benefits, when State Farm would not otherwise be permitted to seek a reduction of the value of these benefits from any award Joerg might receive,” the Florida Supreme Court opined. “This we cannot allow. We conclude that the trial court properly excluded evidence of Luke Joerg’s eligibility for future benefits from Medicare, Medicaid, and other social legislation as collateral sources.”

A growing number of legislators in Florida have voiced concern over issues raised in determining damages awarded in the tort system. Specifically, in accuracy in damages, the original bill is presented to a jury and does not always reflect the actual amount the plaintiff paid due to a co-pay, or other form of relief.

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Florida Justice Reform Institute
210 S Monroe St
Tallahassee, FL 32301-1824

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