Medical Billing, Insurance Write-Offs and the Collateral Source Rule
This has become a monster issue in personal injury litigation. Here's how it works:
Mr. Jones is injured in an accident but has a great recovery. His medical bills are: Billed: $136,000 but b/c of the insurance contractual-adjustment provisions, the providers accept $21,000 for the medical charges in complete satisfaction. What is his element of damages? Nobody has paid the $115,000 that's been eliminated. In Ohio, I'm allowed to introduce the lower amount as 'evidence of the value of the services rendered' according to the OHSC. This is important b/c emotional distress / pain and suffering is generally limited to 3x's economic loss, creating quite a difference.
This article discusses this issue.