Earlier this year, the New Jersey Supreme Court issued an opinion in the consolidated matters of Haines v. Taft/Little v. Nishimura and held that plaintiffs could not seek to board medical expenses at trial as part of their damages between their selected PIP limit and the standard PIP limit of $250,000.
As I predicted in my previous blog, legislation is already in play to reverse the Supreme Court’s ruling in Haines but it leaves more questions unanswered.
As anticipated, New Jersey State Senator Nicholas Scutari revived his bill S2432. S2432 reverses the Supreme Court’s decision, making any medical bills, even those paid for by health insurance, board-able at the time of trial for any amount that exceeds the plaintiff’s PIP policy limit. The Assembly’s official comment on S2432 states:
The bill clarifies that all medical expenses that exceed, or are unpaid or uncovered by any injured party’s automobile insurance medical PIP coverage, regardless of any health insurance coverage, are claimable by any injured party as against all liable parties. This includes any self-funded health care plans that assert valid liens.
The legislature also passed S3963, described as a clean-up bill, which now applies the NJ PIP Fee schedule “unreimbursed” medical expenses above the plaintiff’s PIP limit. S3963 also prohibits balance-billing by providers in excess of the PIP amount. The bill appears to preserve rates set for reimbursed medical expenses by secondary public or private healthcare providers, i.e., Medicare, Medicaid and employer-based healthcare plans. This bill also appears to impact subrogation/lien law in that it appears to now authorize employer healthcare liens that were funded by insurance premiums as opposed to employer and employee contributions (i.e., self-funded), which is currently prohibited by state law and federal law. Finally, the bill now authorizes recovery of attorney’s fees in which the only claim sought is for medical expenses.
S3963 also would apply to motor vehicle accidents on or after August 1, 2019, which creates two different kinds of recovery. Lawsuits which include medical expenses arising from motor vehicle accidents occurring before July 31, 2019, would not be subject to the New Jersey PIP fee schedule, meaning we’ll still be having the battle of the experts at trial to determine the reasonable value of medical expenses at the time of trial likely for the next 4 years as there is a 2-year statute of limitations for bodily injury claims arising from negligence, plus another 2 years it takes to actually try the case.
Both bills are pending on Governor Murphy’s desk. As of the time of authoring this update, there has been no decision from the Governor’s office. The bills automatically become law if the Governor does not act in 45 days.
Assuming these bills pass, I can foresee the insurance industry responding by eliminating PIP policy limits less than the default amount of $250,000, which may be a good thing. As a civil litigator, the bane of both plaintiff’s counsel and defense counsel is dealing with the headaches created by healthcare liens.
Frank Caruso is a partner with the firm in its General Liability department. Please feel free to contact him at (732) 545-4717 or firstname.lastname@example.org with any questions or issues.