In March 2014, plaintiff Dawn Verci filed a negligence lawsuit against defendants Michael High and International Union of Operating Engineers, Local No. 649. She claimed that as a result of the defendants’ negligence, she was injured and underwent medical treatment that cost more than $1 million.
The majority of her medical charges were from Dr. Richard Kube of the Prairie Spine and Pain Institute and the Prairie Surgicenter. The reasonable value of these medical services provided by Dr. Kube was a major issue of contention.
In January 2019, the trial court entered an order (1) prohibiting defendants from cross-examining Kube for his associated medical entities regarding their own cash advertised pricing at trial and (2) allowing defendants’ billing expert, Rebecca Reier, to testify at trial regarding her opinions on the reasonable value of Kube’s medical services.
Soon thereafter, the parties in the case filed a joint petition for an interlocutory appeal. The trial court granted the petition and certified two questions challenging the court’s order.
The appellate court answered both certified questions in the affirmative and remanded the case for further proceedings.
In the underlying lawsuit, Verci claimed that as a result of the defendants’ negligence, she was physically injured, required to undergo medical treatment, and incurred over $1 million in charges for her treatment. Approximately $800,000 of Verci’s alleged medical expenses arose out of treatment she received from Dr. Richard Kube at the Prairie Spine and Pain Institute and the Prairie Surgicenter. Both entities are owned and operated by Dr. Kube.
In the discovery phase of the case, these defendants disclosed the identity of an expert, Rebecca Reier, to present testimony regarding the reasonable value of the plaintiff’s medical services. Reier prepared a report, which was provided to the plaintiff.
In her report, Reier reviewed Dr. Kube’s total charges of $810,937.04 and concluded that “the Usual, Customary and Reasonable total charges for the same geographic area for the same services are approximately $148,118.” (Emphasis in original.) One of the bases of Reier’s conclusion was the cash price as advertised by Prairie Spine and Pain Institute and Prairie Surgicenter on Healthcare.com.
Reier determined that the charges submitted to plaintiff by Dr. Kube are more than 547% higher than the prices advertised online by both entities for the same procedures. Sources Reier used in determining the usual, reasonable, and customary charges for the medical services plaintiff received include “Fair Health Data Systems,” “Optum National Fee Analyzer 2012-2016 – Fair Health Database,” and “The American Hospital Directory CMA and Fair Health Database.”
Reier testified that she believed that the cash price a medical provider offers to patients has some bearing on the reasonable value of the service provided. She did not think a provider would offer a cash price that would cost him or her to lose money. She would not expect the cash price for a service to be 6-and-a-half times less than a charged price.
Dr. Kube also provided deposition testimony. He testified that the cash price of a procedure “represents or illustrates what I think would be a fair reimbursement for my services under that [cash] model and everything that it entails.”
On Jan. 25, 2019, the trial court entered an order stating:
“1. Defendant will not be allowed to cross-examine Dr. Kube or his associated medical entities with regard to their own cash advertised pricing at trial.
2. Rebecca Reier, defendant’s billing expert, will be allowed to testify at trial regarding her opinions on the reasonable value of the medical services at issue in the litigation. Plaintiff is allowed to cross-examine Reier with regard to the data she relies on as the basis for her opinions.”
The parties filed a joint petition for appeal, pursuant to Illinois Supreme Court Rule 308.
The Illinois appeals panel stated that Illinois and most other states follow a reasonable value approach to collateral source rule. As a rule of evidence, it prevents defendants from introducing any evidence that all or part of a plaintiff’s losses have been covered by insurance. Wills v. Foster, 229 Ill.2d 393, 400 (2008). “Courts applying this approach hold that the plaintiff is entitled to recover the reasonable value of medical services and do not distinguish between whether a plaintiff has private insurance or is covered by a government program.” Id. at 407. “The vast majority of courts to employ a reasonable-value approach hold that the plaintiff may seek to recover the amount originally billed by the medical provider.” Id. at 410. Under the reasonable-value approach, the plaintiff may place the entire billed amount into evidence, provided that the plaintiff also establishes the bill’s reasonableness. Id. at 414.
When a bill has not yet been paid, the plaintiff “can establish reasonableness by introducing the testimony of a person having knowledge of the services rendered and the usual and customary charges for such services.” Arthur v. Catour, 216 Ill.2d 72, 82 (2005). When a witness is shown to possess the requisite knowledge, the reasonableness requirement necessary for admission of the bill is satisfied if the witness testifies that the bill is fair and reasonable. Id.
After the plaintiff presents testimony that a bill is reasonable, the defendants can still challenge it. “[D]efendants are free to cross-examine any witnesses that a plaintiff might call to establish reasonableness, and the defense is also free to call its own witnesses to testify that the billed amounts do not reflect the reasonable value of the services.” Wills, 229 Ill.2d at 418; see also Baker v. Hutson, 333 Ill.App.3d 486, 494 (2002) (“The defendant may rebut the prima facie reasonableness of a medical expense by presenting proper evidence casting suspicion upon the transaction.”). However, defendants cannot introduce evidence that the plaintiff’s bills were settled for an amount less than the billed amount because to do so would undermine the collateral source rule. Wills, 229 Ill. 2d at 418.
In this case, the error the trial court made was in refusing to allow defendants to cross-examine Dr. Kube about the cash prices that the medical entities own and operates advertise for their services. This was error because the range of fees Kube charges for the services plaintiff received is admissible and not barred by the collateral source rule.
For the reasons stated above and others, the Illinois Appellate Court entered both certified questions in the affirmative finding that the trial court erred in allowing Reier to testify regarding the reasonable value of the medical services plaintiff received. The case was returned to the trial court for further disposition.
Dawn Verci v. Michael High and International Union of Operating Engineers, Local No. 649, 219 IL App (3d) 190106-B (modified upon denial of rehearing, Jan. 23, 2020).
Kreisman Law Offices has been handling Illinois jury trials, federal court litigation, appeals, catastrophic injury lawsuits, truck accident cases and motorcycle accident lawsuits for individuals, families and loved ones who have been harmed, injured or died as a result of the carelessness or negligence of another for more than 40 years in and around Chicago, Cook County and its surrounding areas, including Elmhurst, Elmwood Park, Lansing, Lemont, Morton Grove, Niles, Winnetka, Wilmette, Waukegan, Joliet, University Park, Melrose Park, Hinsdale, Aurora, Arlington Heights, Orland Park, Chicago (Wicker Park, Bucktown, Logan Square, Roscoe Village, Bronzeville, Back of the Yards, Pilsen, South Chicago, South Shore, Kenwood, Woodlawn, Austin, North Lawndale), Richton Park, Long Grove, Niles, Des Plaines and Naperville, Ill.
Robert D. Kreisman has been an active member of the Illinois and Missouri bars since 1976.
Related blog posts: