In 12 years of practice, every injured client I ever represented shared one common trait - they never thought it would happen to them. When I then proceeded to explain to many of them how little they could expect to recover based on employer-favorable worker's compensation laws or state-mandated minimum auto insurance coverage carried by a defendant driver they were stunned.
Given that Governor Haslam's Tort Reform is on the verge of passage without much opposition, it appears that, like my clients, most Tennesseans assume they will never be injured by another's negligence. I sincerely hope that you and your family are never harmed by a speeding trucker, a drunk driver, a careless professional, an unscrupulous insurer or a greedy financial institutiuon. However, statistically, many of us will experience one or more of these unfortunate events.
If you are affected by such events, you will be stunned by the limits the Governor's bill will have placed on the options for you and your family. Just consider one component of the bill which modifies what is known as the Collateral Source Rule. Although the bill does not mention "collateral source", the changes to the rule are real and are a hidden gem for defendants and insurers alike.
The current Collateral Source Rule recognizes personal responsibility and treats all defendants in injury suits equally. If you responsibly purchased health insurance, medical payments coverage or disability coverage for you and your family and it pays you while you are injured or out of work the person who injures you and his/her insurer does not benefit from your insurance.
For example, if you pay $400 per month for health insurance - by doing so you have paid for the right not to pay retail prices for healthcare. If you are injured and undergo a $1,000 MRI and your insurer has negotiated with the MRI provider to charge you only $500, you and/or your insurer pay only $500 and the balance is written off. At trial, you are allowed to claim the $1,000 bill in full. Why? Because you paid thousands of dollars in premiums for the right to receive the $500 reduction.
Under the Governor's bill, the Collateral Source Rule would be modified or eliminated such that you can only claim the $500 paid by your insurer. The effect is the person who injured you and his/her insurer get the benefit of the health insurance coverage you bought and paid for.
In another example, assume you are injured, out of work and receive money from a disability policy which you paid for. If you lost $10,000 in wages and your disability plan paid you $7,500 while you were off, the Governor's bill would only require the person who injured you to pay you the other $2,500. Again, the person who injured you and his/her insurer save $7,500 because you paid years of premiums for the disability coverage.
In these examples, the person who injured you caused $11,000 in actual damage, but he and his insurer paid only $3,000 in damages to you because YOU paid high premiums for additional insurance coverage. Under the same bill, a person who is injured and did not buy health or disability coverage would receive the full $11,000 in damages.
Why would a conservative Governor and Republican led Legislature reward a negligent party at the expense of a responsible individual who paid premiums and planned for unforseen injury? Why would they advocate for a rule that provides more damages for an individual who did not bother to buy health or disability coverage for his/her family? The only answer is that it will decrease the amount of claims paid by Tennessee auto and other insurers.
In short, it is a gift to insurers who have been seeking this change in the Collateral Source Rule for years. It's the perfect system - insurers collect your premium dollars; pay as little as possible if you have a health or disability claim; and then if an insured driver harms you his/her insurer pays you as little as possible from that person's premiums. What a system.
The Collateral Source Rule is a major component of the Governor's "job creating" tort reform bill. I challenge you to find one individual in the Governor's administration or in the Tennessee Legislature who can explain how this gift to insurers will create a single job. I walked the halls of the Hill last month and asked numerous legislators why they would vote for such a bill. In some cases I received blank stares asking me "what is Collateral Source?" Others simply could not believe that such an offensive rule was buried in the bill they clearly had not read. Needless to say - I was stunned.
If we cannot count on a conservative Legislature and Governor not to reward insurers at the expense of working men and women who responsibly buy insurance to protect themselves - where do we turn? If you are as bothered as me by this bill - call or e-mail members of the House Judiciary Committee (listed below) and tell them. They will pass on this bill this week. Ask them if they have paid insurance premiums for themselves and their families and, if so, why in the world would they support these changes to Collateral Source. Then ask them to remove it from the bill.
Finally, listen to former Senator Fred Thompson's testimony on tort reform before the House Judiciary Committee. If you agree that the reform bill is a solution in search of a problem disguised as a jobs machine - tell the Committee how you feel.
House Judiciary: Officers: Eric Watson (R) Cleveland – 201 WMB -615-741-7799 – firstname.lastname@example.org Jim Coley (R) Bartlett – 207 WMB - 615-741-8201 – email@example.com Vance Dennis (R) Savannah – 209 A WMB – 615-741-2190 – firstname.lastname@example.org Members: Eddie Bass (D) Prospect – 109 WMB – 615-741-1864 – email@example.com Karen Camper (D) Memphis – 20 LP – 615-741-1898 – firstname.lastname@example.org Linda Elam (R) Mt. Juliet – 212 WMB – 615-741-7462 – email@example.com Jeremy Faison (R) Cosby – 202 WMB – 615-741-6871 – firstname.lastname@example.org Jim Gotto (R) Nashville – 205 WMB – 615-741-6959 – email@example.com Jon Lundburg (R) Bristol – 20 LP – 615-741-7623 – firstname.lastname@example.org Debra Maggart (R) Hendersonville – 114 WMB – 615-741-3893 –email@example.com Judd Matheny (R) Tullahoma – 15 LP – 615-741-7448 – firstname.lastname@example.org Gary Moore (D) Joelton – 35 LP – 615-741-4317 – email@example.com Barrett Rich (R) Somerville - 117 WMB – 615-741-8690 – firstname.lastname@example.org Janis Sontany (D) Nashville – 23 LP – 615-741-6862 – email@example.com Mike Stewart (D) Nashville – 24 LP – 615-741-2184 – firstname.lastname@example.org Rick Womick (R) Murfreesboro - 207 WMB – 615-741-2804 –email@example.com