Insurance Law | Jury Awards $19 Million To Man That Had A Portion Of His Medical Bills Wrongly Denied

A case out of California highlights the risk insurance companies run when they second guess medical professionals in a first party context.

The plaintiff in this case, Thomas Nickerson, is a paraplegic former Marine. While attempting to get into his  van, he slipped and broke his leg in two places. Thomas was then admitted to the Veterans Administration Hospital. Doctors at the Veterans Administration Hospital determined that Thomas needed to stay for 109 days. As such, Thomas accrued approximately  $38,150 in medical bills.

Thomas submitted his claim for the hospital stay to his insurance company, Stonebridge Life Insurance. Stonebridge, however, claimed that an 109 day hospital stay was too long and not “medically necessary.” Instead, Stonebridge opined that only a 19 day stay was appropriate.

The case went to trial. After only a two-hour deliberation, the jury awarded Thomas $35,000 for pain and suffering and $19 million in punitive damages.

From my perspective, the punitive damage award is high and may be reduced on appeal, especially in light of the fact that Thomas’s actual damages are below $100,000. However, this case highlights a practice that can be very dangerous for insurance companies: second guessing medical professionals.

This entry was posted in Bad Faith, Compensation and Damages, Insurance, Claims Handling, insurance Bad Faith, Claim Denials, Jury Verdicts, Personal Injury, Trial/Litigation and tagged , , , , , , , . Bookmark the permalink.

One Response to Insurance Law | Jury Awards $19 Million To Man That Had A Portion Of His Medical Bills Wrongly Denied

  1. Bill Fazio says:

    Seems high, did the plaintiff’s former Marine status play a role? Second guessing is a serious pitfall but so is taking a sympathetic plaintiff to court. Post-verdict sturcturing may be an interesting option for both the insurers (to reduce outlay) and the plaintiff (to avoid risk of significant reduction).


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