## Facts

- Eddie Hoffman was rear-ended in October 2010 in Baton Rouge, Louisiana, by a vehicle driven by Carolyn Elzy.
- Hoffman sued Elzy and Elzy’s liability insurer, 21st Century North America Insurance Company, seeking personal-injury damages.
- At trial, Hoffman offered medical bills totaling $4,528.
- The defense introduced evidence that, under a discount arrangement negotiated by Hoffman’s attorney with the provider, about $2,050 was written off, leaving $2,478 actually owed.
- The discount did not arise from Hoffman’s health insurance or a similar third-party payor arrangement; it resulted from negotiations connected to the litigation.

## Issues

1. Whether an attorney-negotiated medical provider write-off constitutes a collateral source under Louisiana’s collateral source rule, permitting recovery of the full billed amount rather than the discounted amount actually owed.

## Decision

- The Louisiana Supreme Court affirmed the lower courts.
- The court held that an attorney-negotiated medical discount/write-off is not a collateral source benefit.
- Hoffman could recover only $2,478 in past medical expenses, not the $2,050 written off.
- The award remained $4,500 in general damages and $2,478 in medical expenses.

## Legal Principles

- Under Louisiana’s collateral source rule, a tortfeasor generally may not reduce damages based on payments or benefits the plaintiff receives from sources independent of the tortfeasor.
- Louisiana applies a “benefit-of-the-bargain” approach: collateral source treatment typically requires that the plaintiff provided consideration for the benefit (e.g., insurance premiums).
- A medical write-off is not recoverable as damages when the plaintiff did not pay consideration for the discount and is not legally obligated to pay the written-off amount.
- Attorney-negotiated medical discounts tied to litigation are excluded from the collateral source rule, in part to avoid inquiries into attorney-client fee arrangements and related privilege concerns.

## Conclusion

Attorney-negotiated medical provider write-offs are not collateral sources in Louisiana; a plaintiff may recover only the amount actually owed or paid for medical services, not the written-off portion.


Hoffman v. 21st Century N. Am. Ins. Co., 2015 WL 5776131 (La. 2015)