Critics call them “phantom damages,” while supporters simply call them a “fair market valuation.” When individuals seek damages for a personal injury claim, some states require victims to seek only damages they actually paid out of pocket for their injuries, while other states allow victims to seek damages based on the fair market value of care for a particular injury. South Carolina allows victims to sue for the fair market value that medical care would cost for a given injury, regardless of how much the person’s insurance actually paid for care.
According to a recent summary report published by the Florida Justice Reform Institute, list prices of health services may be anywhere from three to four times the amount actually paid by Medicaid, Medicare, or a private health insurance. This is due to the fact that plans like Medicaid and insurers often negotiate their own fee schedules with providers. Recent reports have suggested that the gap between the list price of services and the actual amounts paid out by insurance is growing.
Personal injury lawyers like Doug Churdar with Churdar Law Firm often arrive at an estimate of damages based on fee schedules listed by hospitals and other providers. When determining future medical expenses, lawyers will often use these tables to make reasonable estimates for their clients.
However, critics have argued that victims of personal injury collect more money than they should because their health insurance often pays less than these tables suggest. Critics call these damages, “phantom damages” because they claim that they don’t reflect damages accurately.
However, not all patients are insured, and when predicting future medical costs, personal injury lawyers cannot assume that their clients will continue to be insured in the future. Insurance is often contingent on which state a person lives, whether a person is employed, and whether a person qualifies for certain government safety net policies. Damages in personal injury cases are intended to protect victims in the future and ensure that their medical expenses are paid—regardless of their circumstances or future employment. Individuals who are uninsured are charged “sticker price” rates for health services rendered and personal injury damages are designed to ensure that victims can pay the sticker price should they need to do so in the future.
Personal injury lawyers also argue that the rates that insurers negotiate with hospitals is a private contract, and that when victims are insured, they have often paid monthly premiums over time which are not included in the amount of money collected for damages in a personal injury case.
The debate often extends to whether a jury in South Carolina should be allowed to consider medical expenses as billed and whether this evidence should be submitted in court. One writer for the South Carolina Law Review argues that medical inflation in recent years warrants a re-assessment of current laws regarding damages.
The arguments for assessing damages based on health insurance rates seem to stem primarily from a frustration with inflated health costs. Perhaps a more serious assessment of the ways in which uninsured patients are disenfranchised by these inflated rates should be considered before these same patients become further disenfranchised by being denied damages to pay these same medical bills.
The way a personal injury lawyer assesses damages in South Carolina can make a huge difference on the award amount a client receives. Lawyers often have to negotiate a range of concerns before determining an amount to seek in damages. Fill out a free case evaluation form at www.churdarlaw.com.

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