Butler v. Indiana Department of Insurance
2009 Ind. LEXIS 342, 904 N.E.2d 198, 2009 WL 944383 (2009)
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Rule of Law:
Under Indiana's wrongful death statute for an unmarried adult without dependents, recoverable damages for medical expenses are limited to the amount medical providers ultimately accept as full payment after contractual adjustments, not the total amount initially billed.
Facts:
- Nondis Jane Butler, an unmarried adult with no dependents, received medical services from various providers, including Clarian Health Partners, Inc.
- Butler initiated a claim for medical negligence against Clarian and others.
- Before the claim was resolved, Butler died.
- Medical providers billed a total of $410,062.46 for the care provided to Butler.
- Due to contractual arrangements with Butler's private insurer, Medicare, and Medicaid, the providers accepted $122,161.18 as full and final payment for the services.
- The providers wrote off the remaining $287,901.28, and neither Butler nor her estate was liable for this difference.
Procedural Posture:
- Nondis Jane Butler's Estate continued her medical negligence claim as a wrongful death action after her death.
- The Estate settled with the primary defendant, Clarian Health Partners, Inc., for $250,000.
- The Estate then proceeded against the Indiana Patient Compensation Fund ('the Fund') for excess damages.
- In the Marion Superior Court (trial court), the Fund moved for partial summary judgment to limit recovery of medical expenses to the amount actually paid.
- The Estate filed a cross-motion for summary judgment to recover the full amount billed by medical providers.
- The trial court granted the Fund's motion for summary judgment and denied the Estate's motion.
- The Estate (Appellant) appealed to the Indiana Court of Appeals, with the Fund as Appellee.
- The Court of Appeals affirmed the trial court's judgment.
- The Indiana Supreme Court granted transfer to review the case.
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Issue:
Does the phrase "reasonable medical...expenses necessitated" in Indiana's wrongful death statute (Ind. Code § 34-23-1-2) limit recoverable damages to the amount actually paid and accepted in full satisfaction by medical providers, rather than the total amount originally billed?
Opinions:
Majority - Justice Dickson
Yes. Under the wrongful death statute, recoverable damages are limited to the amount actually paid and accepted by medical providers. The statute is in derogation of the common law, and therefore must be construed narrowly and strictly against the expansion of liability. The statutory language authorizes recovery only for 'expenses necessitated' by the wrongful act. The difference between the amount billed and the amount accepted as full payment is not a 'necessitated' expense because no party is obligated to pay it; the debt has been extinguished. This statutory claim is distinct from common law personal injury actions where recovery is based on the 'reasonable value' of services, a standard the legislature did not employ in this specific statute.
Analysis:
This decision creates a significant distinction between damages available in statutory wrongful death actions and common law personal injury actions in Indiana. By limiting recovery to the amounts actually paid, the court prevents plaintiffs in this specific type of wrongful death case from recovering the 'written-off' portion of medical bills as part of their damages. This ruling benefits defendants and compensation funds by substantially lowering their potential liability for medical expenses. It solidifies the principle that statutes creating causes of action not recognized at common law will be interpreted strictly, limiting recovery to the explicit terms of the statute.
