Article Summary

• For most personal injury actions filed in Louisiana after January 1, 2026, changes are coming as to how past medical expenses are awarded in a jury trial.
• These changes modify the current rules and will allow the jury to see the amounts medical providers accept as payment, regardless of who is paying their bills.
• These changes are another step in the right direction but leave several issues that will continue to artificially increase the costs of litigation in Louisiana.

Reducing Past Medical Costs in Personal Injury Litigation

Under the current healthcare system in the United States, medical providers frequently send bills for services rendered without the expectation of recovering amounts anywhere close to face value. Most of these medical providers maintain contracts with health insurers, Medicare, or Medicaid, wherein the insurance company agrees to pay a fixed amount for those services. These fixed amounts can range from pennies on the dollar up to 20-50% or more of the amount billed. The difference in what is billed and what is paid is written off as unrecoverable by the provider. For the most part, there are no rules limiting what a medical provider can charge for a particular service beyond the general market pressure of competition.

For years, personal injury plaintiffs in Louisiana were allowed to recover the amount their medical providers billed for services performed, regardless of what the provider was actually paid. Defendants, on the other hand, were not allowed to raise how much a provider was actually paid, despite often vast discrepancies. The face value of the bills were the jury’s only basis for awarding past medical expenses, thereby often providing the plaintiff with a pocketable windfall of the difference between what their doctor billed and what was actually paid or owed to the doctor.

In 2020, the Louisiana legislature passed La. R.S. § 9:2800.27, setting out a scheme, albeit a complicated one, looking to address this issue and limit the amount recoverable for past medical expenses. This rule treats past medical costs differently depending on who paid for them (i.e. health insurance, Medicare, Medicaid, Workers’ Compensation, etc.).

In most instances, the statute limits the amount the plaintiff can recover to the amount the medical provider was actually paid for their services. However, in cases where private health insurance or Medicare is paying, the jury can only be shown the total billed amount. The jury is not to be told what was actually paid or by whom. The court then holds a post-trial hearing where the difference between what was billed and what was paid is removed from the jury’s damage award and the judge adds a penalty of 40% of the reduced amount to ‘reimburse’ the plaintiff for their costs and attorney’s fees.

The result is that the jury is shown artificially inflated numbers for past medical treatment. For example, if a doctor charged $100,000 for services related to an accident, but the Plaintiff’s health insurer only paid $25,000 to the doctor for those services, the jury would be told to award the cost of related services at $100,000. After trial, the judge would reduce the $100,000 award to $25,000 and then award a penalty of up to $30,000 to the plaintiff.

Upcoming Changes

Effective January 1, 2026, the amended La. R.S. § 9:2800.27 still treats different payors differently but now gives the jury more of the information they need to make an informed decision  as to what damages to award. The revised statute also eliminates the post-trial hearing and the 40% penalty provision.

Like the current rule, the amended rule outlines what can be recovered and what the jury can see based on who is paying for the medical treatment. While it addresses more than the earlier version, some loopholes remain that we expect will be regularly exploited. Below is a breakdown of how the new rule will address various scenarios.

If Health Insurance is Paying for the Plaintiff’s Medical Treatment

If the plaintiff’s medical treatment is paid for by private health insurance, the recovery for past medical expenses is limited to the amount actually paid to the health care provider by the insurer plus any out-of-pocket costs (co-pays, deductibles, etc.). While the jury can only award the amount actually paid to the provider, they can be shown the amounts billed in addition to the amounts paid and owed to the provider.

Louisiana’s balanced billing laws prevent a medical provider from billing a patient with health insurance for amounts over the agreed contractual reimbursement rates the provider has with an insurer. See La. R.S. § 22:1871, et seq. Accordingly, it will be important to communicate this fact to the jury so there is no attempt to try to award the difference.

If Medicare is Paying for the Plaintiff’s Medical Treatment

Medicare is treated the same way as health insurance under the revised statute. The jury is to be shown both the amount billed to Medicare and the amount Medicare paid to the provider. The award is then limited to the amount that was actually paid by Medicare or by the plaintiff.

If Medicaid is Paying for the Plaintiff’s Medical Treatment

If the plaintiff’s medical treatment is being paid for by Medicaid, the plaintiff can only recover the amount Medicaid paid to the provider and any cost sharing or outstanding amounts owed to the provider. Unlike with health insurance and Medicare, when Medicaid is paying, the jury can only be shown the amount paid to the provider and is not to be shown the full billed amount.

If the Plaintiff’s Medical Treatment is Being Paid by Workers’ Compensation

If a plaintiff’s medical treatment is being paid under the Louisiana Workers’ Compensation Act, the plaintiff’s recovery is limited to the amount to be paid pursuant to the fee schedule under that Act. Because the Workers’ Compensation Act provides payment of medical treatment without contribution by the employee/plaintiff, there will not be any out-of-pocket costs to add to this recovery. As with Medicaid, the jury can only see the amount paid, not the amount billed.

When an attorney is paying for a plaintiff’s medical treatment and the medical provider has agreed to accept less than the amount billed, the revised statute provides that the award for medical treatment is limited to the amount the provider agreed to accept, and any cost sharing amounts paid or still owed by the plaintiff (not their attorney). In this instance, only the amount paid to or owed to the provider is to be shown to the jury, rather than the amount billed.

How the Rule Will Apply in Other Situations

The revised statute has a ‘catch all’ provision for instances where medical benefits are not being paid for by health insurance, Medicare or Medicaid. This section limits the recovery of past medical costs to the amount paid to a medical provider on behalf of a plaintiff, and any remaining amount owed to the provider under a contractual or statutory privilege, lien or guarantee.

It appears this provision would apply to instances where the medical provider asserts a valid lien under La. R.S. § 9:4751 et seq., or where the medical treatment is being paid for by a third-party litigation funding company ostensibly acting as a factoring company, for example.

What Issues Remain

While these revisions are a welcome improvement to how past medical costs are calculated and assessed during litigation, there are several issues we foresee arising that will need to be litigated in the Courts.

First, nothing in the original 2020 rule or in this 2026 revision addresses what should happen when a plaintiff has health insurance, Medicare or Medicaid but refuses to use it to pay for their accident-related treatment. This commonly used strategy will continue to create artificially inflated past medical damage awards that could have been addressed simply by using the plaintiff’s pre-existing and legally required health insurance. While legislation was proposed to address this issue, it did not become law, and the issue will need to be affirmatively addressed under the new statutory rules.

Second, if attorneys continue to delay their discount discussions with medical providers until after litigation, thereby skirting the clear intention of the new law, will historical agreements between attorneys and medical providers be discoverable and admissible under the new rule to show potential reductions to the jury?

Third, with the inclusion of language in the new rule regarding the recovery of past medical costs on lien, will the statutory language in La. R.S. § 9:4752 limiting such liens to the “reasonable charges or fees” of that health care provider allow a defendant to challenge the face value or billed amount as not being reasonable and therefore not recoverable? While there was proposed legislation this session to address what constituted a “reasonable” fee for a medical service, it did not become law. But if a defendant cannot challenge whether a fee is reasonable, there will be nothing to prevent a medical provider from charging whatever they want for their services and then asserting that amount as a lien under La. R.S. § 9:4752.

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