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.
- Jury awards paraplegic former Marine $19 million (seattletimes.nwsource.com)
- Jury awards paraplegic former Marine $19 million (sfgate.com)