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Lagerstrom v. Myrtle Werth Hospital-Mayo Health System7/14/2005
This is an appeal from a judgment and order of the Circuit Court for Dunn County, William C. Stewart, Jr., Judge. This wrongful death medical malpractice case comes before this court on certification from the court of appeals pursuant to Wis. Stat. § 809.61 (2001-02).
Following a jury's verdict, the circuit court entered judgment in the amount of $55,755 plus costs in favor of Klover Lagerstrom, individually as surviving spouse of Vance H. Lagerstrom and as Special Administrator of the Estate of Vance H. Lagerstrom, deceased, referred to collectively as the estate, against Myrtle Werth Hospital-Mayo Health System, ABC Insurance Company, its insurer, Red Cedar Clinic-Mayo System, and DEF Insurance Company, its insurer, referred to collectively as the defendants. The circuit court's order denied a post-verdict motion under Wis. Stat. § 805.14(5)(c) to change the answers on the special verdict; the estate appealed.
The primary issue presented is whether the circuit court erred under Wis. Stat. § 893.55(7) in admitting evidence of collateral source payments in this medical malpractice action, in refusing to admit evidence of the estate's potential obligation to reimburse Medicare, and in instructing the jury that it may, but need not, consider the collateral source payments in determining the reasonable value of the medical services rendered. A second issue is whether the circuit court erred in not awarding the estate $7,610.10 for funeral expenses.
Wisconsin Stat. § 893.55(7) reads:
Evidence of any compensation for bodily injury received from sources other than the defendant to compensate the claimant for the injury is admissible in an action to recover damages for medical malpractice. This section does not limit the substantive or procedural rights of persons who have claims based upon subrogation.
We conclude that the text of § 893.55(7) explicitly allows evidence of collateral source payments to be introduced in medical malpractice actions but fails to state the purpose for which the evidence is admitted. We further conclude that if evidence of collateral source payments from sources including Medicare, other state or federal government programs, medical insurance or write-offs, and discounted or free medical services is presented to the fact-finder, then the parties must be allowed to furnish the jury with evidence of any obligations of subrogation or reimbursement. Because the statutory text does not inform a fact-finder what to do with the evidence, in interpreting the statute and determining what a fact-finder must do with the evidence we consider the text of the statute, the legislative history, the legislative goal, and three common-law concepts encompassed in medical malpractice actions and Wis. Stat. § 893.55(7), namely thereasonable value of medical services, the collateral source rule, and subrogation. We conclude that the circuit court must instruct the fact-finder that it must not reduce the reasonable value of medical services on the basis of the collateral source payments. Although the jury is instructed not to use the evidence of collateral source payments to reduce the award for medical services, evidence of collateral source payments may be used by the jury to determine the reasonable value of medical services.
We further conclude that regardless of the interpretation of Wis. Stat. § 893.55(7) adopted, because the jury in the present case was advised of the collateral source payments and the net amount the estate paid for medical services, but was not advised of the estate's potential obligation to reimburse Medicare for medical services, the jury was not able to assess the reasonable value of medical services
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