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Collateral source, expert witness standard bills heard in special committee

  

JEFFERSON CITY, Mo. — Two of the most impact tort reform bills of this legislative session got hearings in the House Special Committee on Litigation Reform Tuesday afternoon. Rep. Joe Don McGaugh and Rep. Kevin Corlew presented their respective legislation on the collateral source rule change and the adoption of the Daubert expert witness standard.

The senate has already heard a bill similar to McGaugh’s on the collateral source rule change, and the contention over the issue between the business community against the Missouri Association of Trial Attorneys (MATA) continued in the House hearing.

Under Missouri’s current system, a jury can receive evidence in special damages and injury cases about the total amount of money a given procedure costs a hospital from the plaintiffs while a defendant can present evidence of what a plaintiff has received from insurance companies — either theirs or the defendants’ — and make a judgement anywhere in between those two amounts. Proponents of collateral source claim this condition increases insurance rates and creates confusion in the legal system.

McGaugh
McGaugh

McGaugh’s bill ostensibly would limit the evidence a jury can receive in special damages claims cases to what amount of money has been paid to satisfy the medical bills and what it costs, not factoring in what a hospital values the procedure to be.

Dana Frese, from the Missouri Organization of Defense Lawyers, said this would clear up the confusion existing in statute and help protect defendants from having to pay exorbitant sums in injury cases.

“The way the law is written now, certain portions are used to land a windfall. We don’t want to see a windfall, we want to see people made whole,” McGaugh said.

However, House Democrats on the committee had some reservations about the bill. Rep. Gina Mitten questioned if other states had seen lower premiums on their insurance rates, but neither McGaugh nor Frese could respond to speak on the policy in other states. Jay Benson of MATA instead suggested defendants found liable of injury received the most cash by saving money from not paying higher costs.

“If there is a windfall, who should get it: The person who worked hard to pay those insurance premiums or… the person who crossed the centerline and hit our client head-on?” Benson asked.

Benson also could not answer questions of whether collateral source had lowered insurance premiums in other states.

However, Benson was the only person to testify against to bill. The Missouri Chamber of Commerce and more than a dozen other industry lobbyists testified on behalf of the bill.

Corlew’s bill made up the other half of the hearing. His bill is more straight-forward; it would change the standard by which expert witnesses are judged competent from the Frye standard created in 1923 to the Daubert standard. The Daubert standard has many provisions, among them the notion that the judge has greater authority on whether or not expert testimony is based on scientific evidence derived from the scientific method.

The current standard used in Missouri’s courts only looks at the expert witness’ qualifications, so Daubert is considered more strict, and thus, better at achieving rule of law.

Corlew has presented the bill in the two previous legislative sessions, and he no doubt hopes the third time is the charm.

“This is a clear and understandable standard that courts can readily adopt,” he said. “It would bring increased efficiency in the expert qualification process.”

While many businesses supported this legislation as well as the collateral source rule change, MATA strongly opposes this bill as well under the belief it could clog up Missouri’s courts.

The United States Chamber of Commerce has also launched an ad campaign focused on Missouri urging a climate more favorable to business interests in Missouri.

“Missouri’s poor litigation environment benefits trial lawyers at the expense of small businesses and consumers,” said Lisa A. Rickard, president of the chamber’s Institute for Legal Reform. “Fortunately, the state legislature now has a chance to put jobs and justice first.”

Opposition from the chambers coincides with reports from a pro-business and litigation reform group arguing Missouri is a “judicial hellhole.”

The hearing did not officially conclude, however, as the number of people wishing to testify exceeded the two hours allotted for the hearing. The committee will next meet Jan. 25.