TBA Law Blog


Posted by: John Day on May 1, 2017

Journal Issue Date: May 2017

Journal Name: May 2017 - Vol. 53, No. 5

Does a minor have a right to seek recovery for medical expenses in a personal injury case?

Historically the answer was generally “no,” with several cases holding that the claim belongs solely to the parent(s) who paid the medical bills.[1] Several other decisions called the strict application of the rule into question,[2] leaving the door open to minors making a claim for medical expenses incurred during minority under certain circumstances.

A recent decision of the Tennessee Court of Appeals attempts to set the record straight, at least in a case where an exculpatory clause bars the parent from seeking recovery of medical bills incurred to treat a child. In Blackwell v. Sky High Sports Nashville Operations LLC,[3] Jacob’s mother signed the typical waiver of rights demanded by an increasing number of those who provide services (in this case, access to an indoor trampoline park).[4] Jacob was injured at the facility, and his mother filed suit for the two of them, with her seeking damages for medical expenses incurred. When the exculpatory clause was enforced against her claim, she sought to amend the complaint to permit Jacob to seek damages for the medical expenses incurred. The trial judge denied the motion to amend except to the extent Jacob sought to recover for post-majority medical expenses.

After pages of discussion on this and other matters,[5] the three-judge panel led by Judge J. Steven Stafford said in their view the “Tennessee Supreme Court does not intend to allow a child to raise claims belonging to his parent simply because the parent cannot maintain the action, either because of the expiration of a statute of limitation or repose or the waiver of that claim through an exculpatory agreement.”[6] The unanimous court then concluded that (a) Jacob could not maintain an action for pre-majority medical expenses that were paid or will be paid by his parents; and (b) Jacob may only maintain an action for those expenses he paid or is obligated to pay. The appellate court remanded to permit the trial to court to ascertain what expenses the minor had paid or was obligated to pay,[7] but barred recovery for those expenses paid by his parents.[8]

I do not know what evidence, if any, was offered into the record on the following issue, but it deserves discussion. Today, a health care insurance policy without a reimbursement provision is as rare as effective clock management by Les Miles. Most health care insurance policies include language giving a first-dollar right of reimbursement against anyone who recovers damages for personal injury for which medical bills have been paid. Tenncare does the same, allowing recovery of amounts paid against the “recipient”[9] who recovers damages from a third-party.

So, let’s assume the parent of an injured child failed to file a claim within the statute of limitations or signed an exculpatory clause but the child’s claim survives. Assume further that the child has not paid one penny in medical bills, virtually all of which were paid by a health insurance plan that has a right of reimbursement. If the child does not have the right to recover medical expenses during minority unless he or she actually paid them, does the party holding a subrogation right have the right to collect the amounts it paid from the child’s recovery of damages for loss of earning capacity and noneconomic losses? Remember, this is not a situation where the child did not seek medical expenses; instead, the child was barred from seeking expenses. Before you answer, remember the super-lien status given to self-funded plans under ERISA, the statutory right of first-dollar recovery for Tenncare, and the (albeit rare) Medicare first-dollar rights if it makes payments on behalf of a minor. Also remember that some minors are hurt on-the-job and workers’ compensation reimbursement rights have historically been first-dollar rights.[10]

Moreover, on remand, is it appropriate for the trial judge to look at any reimbursement language in the health insurance policy that paid Jacob’s medical bills and see if Jacob is at risk for having to repay medical bills from his recovery and, if so, then determine that Jacob may recover those medical expenses for the benefit of the insurer because the child “will be obligated to pay” the monies if the case is successful?

Once again, I do not know whether there was evidence of health insurance or reimbursement rights in the record or, if so, the nature or extent of the reimbursement right. But I do know this: it would be a horrible injustice for a public or private health insurer to be permitted to take dollars for medical expenses from the recovery of a child when the child was legally prohibited from seeking a recovery for those expenses. And if federal or other law requires reimbursement from funds recovered by the child, then the child should be permitted to recover the medical expenses from the tortfeasor because the child “will be obligated to pay” the expenses if the claim has merit and a recovery is obtained.

Notes

  1. Dudley v. Phillips, 405 S.W.2d 468 (Tenn. 1966); Tenn. Code Ann. § 20-1-105(a).  
  2. Palanki ex rel Palanki v. Vanderbilt Univ., 215 S.W.3d 380 (Tenn. Ct. App.) no perm. app. filed;  Smith v. King, 1984 WL 586817 (Tenn. Ct. App. Sept. 21., 1984); Wolfe v. Vaughn, 152 S.W.3d 631, 634 (Tenn. 1941).
  3. No. M2016-00447-COA-R9-CV, 2017 WL 83182 (Tenn. Ct. App. Jan. 9, 2017)
  4. The release was executed on July 3, 2012, but provided it stayed in effect for future visits to the facility. The child was injured on March 26, 2013.  
  5. Other issues addressed include the enforceability of the forum selection clause, the enforceability of the choice of law clause, and the enforceability of the waiver the mother signed against the legal rights of the son. Sky High appropriately lost those three issues. The decision on recoverability of medical expenses consumes the last 25 percent of the opinion.
  6. 2017 WL 83182 at *29, citing  Calaway ex rel Calaway v. Schucker, 193 S.W.3d 509, 519 (Tenn. 2005).
  7. Id.   
  8. Id.
  9. Tenn. Code Ann. § 71-5-117.  A “recipient” is “any person who has been determined eligible to receive benefits … and who has received such benefits. Tenn. Code Ann. § 71-5-103(10).
  10. Tenn. Code Ann. § 50-6-112.

John Day JOHN A. DAY is a personal injury and wrongful death lawyer with offices in Brentwood and Murfreesboro. He believes that subrogation and its first cousin, reimbursement, are rights that are and should stay rooted in equity.