Paying A Plaintiff’s Medical Bills While Litigation Is Still Pending

November 16, 2021

Did you know that a person (or his/her insurer) can make a payment for medical expenses, subrogation interests, etc., to an injured party at any time before or during litigation without adversely affecting the outcome of litigation? Under Idaho Code § 41-1840, a party’s (or insurer’s) payment for bodily injury or property damage to another party does not constitute an admission of liability. It also does not waive any defenses against the injury, death, or loss for which the payment was directed. As explicitly stated in the statute, the prepayments will not be admissible as evidence at trial. Tommerup v. Albertson’s, Inc., 101 Idaho 1, 607 P.2d 1055 (1980). The party making a payment will be credited for the payment upon settlement or at the time a judgment or award is rendered.

Interestingly, the Idaho Supreme Court found an insurer can still get credit for an amount paid to the other party regardless of whether the parties were insured by the same company. Schaffer v. Curtis-Perrin, 141 Idaho 356, 359, 109 P.3d 1098, 1101 (2005). In Schaffer, the parties were insured by the same carrier. The plaintiff’s insurer paid for some of her medical expenses under her own insurance policy. The claims representative for the plaintiff’s medical expense payments then sent a subrogation claim notice to the claims representative for the defendant. Both worked for the same insurance company, but they worked in different parts of the company. The claims representative for the defendant then issued a check for the medical expense subrogation. The Supreme Court found that, regardless of the corporate umbrella structure, the plaintiff and the defendant clearly had two separate accounts with the insurance carrier; thus, they were effectively insured by two different companies. The Idaho Supreme Court allowed for the defendant to be credited for the prepayment under Idaho Code § 41-1840.

There is also no specific time frame for when prepayments can be made under Idaho Code § 41-1840. In Schaffer, the defendant’s claims representative did not make the payment for the plaintiff’s medical expenses until a year and a half after the accident. The Supreme Court found the legislature could have required a certain level of promptness to receive credit for prepayments under Idaho Code § 41-1840. The legislature did not, and the Idaho Supreme Court declined to read a timing requirement into the legislation.

As a final note, credit for prepayments under Idaho Code § 41-1840 are not just limited to verdicts after trial. Prepayments that can be credited to a verdict under Idaho Code § 41-1840 must also be credited to an offer of judgment under Idaho R. Civ. P. 68.  Carlson v. Stanger, 146 Idaho 642, 651, 200 P.3d 1191, 1200 (2008).