An Illinois appeals court overturned a $165,353 workers compensation medical award and more than $46,000 in legal fees and costs, ruling that an injured worker was entitled only to reimbursement for amounts actually paid to his medical providers.
In Jenkins v. McLaughlin Body Co., the Appellate Court of Illinois, Fourth District, ruled Wednesday that a lower court improperly based its judgment on the face value of Cory Jenkins’ medical bills rather than the negotiated amounts paid by his health insurer.
Mr. Jenkins sustained a compensable workplace injury in 2016 while employed by McLaughlin Body Co. A workers compensation arbitrator ordered the company to pay his related medical bills pursuant to state law.
The medical providers originally billed $165,353.54, but UnitedHealthcare, which insured Mr. Jenkins through a subsequent employer, paid $47,594.83 after negotiated reductions and write-offs. Mr. Jenkins also made out-of-pocket payments, and several bills remained unpaid.
A Rock Island County judge entered judgment against McLaughlin for the full billed amount and later awarded Mr. Jenkins $41,316.32 in attorney fees and $5,651.22 in costs.
The appeals court said the lower court effectively overruled the arbitrator’s direction that the bills be paid under certain sections of the law that limit an employer’s liability to the negotiated rate or to another applicable statutory amount.
Requiring McLaughlin to reimburse Mr. Jenkins for the original charges rather than the amounts accepted by the providers would give him a “windfall,” the court said.
The court rejected Mr. Jenkins’ argument that using the amount paid by UnitedHealthcare improperly gave McLaughlin a credit for benefits provided by a plan to which the company had not contributed.
The insurer’s payment was not a deduction from McLaughlin’s obligation, the court said. Rather, it established the amount of the obligation because the providers had accepted it in satisfaction of their bills.
The court also overturned the attorney fee and cost awards, finding no evidence that McLaughlin refused to pay the compensation it owed. The company had issued a $54,546.05 check covering the medical reimbursement and interest, but Mr. Jenkins rejected it because he disputed the calculation.
This article was first published by Business Insurance.
