Howell damages

What it is

"Howell" is shorthand for the measure of past medical damages in California. Providers bill one amount and accept a lower one from health plans under their contracts. The difference, often large, can't be recovered as damages.

The California rule

In Howell v. Hamilton Meats & Provisions, Inc. (2011), the California Supreme Court held that a plaintiff whose providers accepted reduced payments under prior agreements with the plaintiff's health plan can recover no more than the amounts actually paid, plus any amounts still owed. Evidence of the full billed amount is not relevant to past medical damages in that situation. The collateral source rule survives: the jury still isn't told that insurance paid the bills.

Later cases address plaintiffs who don't fit that pattern. In Bermudez v. Ciolek (2015), the Court of Appeal held that for an uninsured plaintiff, the measure is the lesser of the amount paid or incurred and the reasonable value of the services, and billed amounts can be evidence of that value. In Pebley v. Santa Clara Organics (2018), a plaintiff with insurance who chose to treat on a lien was treated as uninsured for this purpose. Future medical damages are proved separately, usually by expert testimony.

Why it matters to a plaintiff firm

Howell changes what the specials total means. Firms gather both billed and paid figures, state paid amounts for insured treatment in the demand, and decide early, with the client, whether lien treatment makes sense.