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Injury Claims Against Guaranty Association

Injury Claims Against Guaranty Association

Brien Roche

The Virginia Guaranty Association is a state-created entity.  It steps in on behalf of insurance companies that have gone belly-up.  It has the right to defend the defendant.  The defendant is the person that caused the plaintiff’s injury.  The suit then is against the defendant but may be defended by an attorney on behalf of the Guaranty Association and also an attorney on behalf of the actual defendant.  Typically they are the same attorney.

The Guaranty Association, as a state-created entity, is entitled to certain protections.  

Injury Claims against Guaranty Association-Setoff for Medical Bills Paid

The Guaranty Association is entitled to a set-off or reduction of the amount it owes, in the amount actually paid by health insurance.  See MacDougal, 61 Va. Cir. at 220 (“health insurance benefits actually paid are an offset from covered claims”) (emphasis added).  However the Association remains responsible for the entire judgment that might be obtained against the defendant, up to the amount of $300,000 (Va. Code § 38.2-1606(A)(1)), minus the amount actually paid by health insurance.

Therefore if plaintiff obtains a judgment against defendant for $500,000 for her pain and suffering, inconvenience, any wage loss, and her total medical expenses attributable to this collision, the Guaranty Association will be responsible for the total “covered claims” up to the amount of $300,000, minus the amount “actually paid” by health insurance.  In other words the Guaranty Association is responsible for $290,000 of that $500,000 judgment if the benefits actually paid are $10,000.

Exhaustion

There is nothing in the MacDougall case or in Va. Code § 38.2-1600 et seq. to suggest that the Guaranty Association statutes have in any way abrogated or restricted the application of the collateral source rule. Nor are there any other Virginia cases which so hold. The only limited exception or “carve out” to the collateral source rule is found in Va. Code § 38.2-1610 (A) and (A1), which provides for an “exhaustion” of other insurance before the Guaranty Association must pay, and which further provides that the amount payable on a “covered claim . . . shall be reduced by the amount of any recovery under such program” or under an “insurance policy.” (See Va. Code § 38.2-1610 (A) and (A1)). Therefore § 38.2-1610 does not impact the application of the collateral source rule. It just means that, at the end of the case, the Guaranty Association may have a credit or reduction in the amount it owes for Plaintiff’s medical expenses in the amount recovered under Medicaid or some other insurance. 

Injury Claims Against Guaranty Association-Collateral Source Rule

None of the Guaranty Association statutory provisions limit the application of the collateral source rule. In other words, in a personal injury action, Plaintiff will be allowed to put on evidence of medical expenses related to this collision. Furthermore the Defendant (or the Guaranty Association, in the event it defends the defendant) will not be allowed put on evidence or make reference to any payments toward those medical expenses that have been paid by collateral sources, including Medicaid, or any “write-offs” or “write downs” by her medical providers for those medical expenses. See, e.g., Llewellyn v. White, 297 Va. 588, 601 (2019); Radvany v. Davis, 262 Va. 308, 310 (2001); Acuar v. Letourneau, 260 Va. 180, 192 (2000).

So under Virginia law the prohibition against evidence or references to collateral sources likewise applies to amounts covered or paid by Medicaid or Medicare. See, e.g., Ayers v. AFS of Hot Springs, Inc., 2014 Va.LEXIS 20 at *2, 9 (Va. 2014) (Supreme Court agreeing that references to “health insurance, Medicare, Medicaid, ‘write-offs,’ [and] ‘write-downs’” were considered references to inadmissible collateral sources, and that “it is not disputed that counsel for AFS asked a question about collateral source funding in violation of the terms of the agreed upon order in limine”)

Also see Marshall v. Moniz, 2011 Va. Cir. LEXIS 292 at *3 (York Co. Cir. Ct. 2011) (wherein the court granted plaintiff’s motion in limine to exclude other collateral sources and that the values, facts, etc., of any insurance, Medicaid, Medicare, Social Security, including disability payments, etc., of Plaintiff shall not be introduced, referred to or otherwise used at trial).

Medicaid et al.

Hence except for the limited “exhaustion of other insurance” or “set-off” provisions of § 38.2-1610, there would be no reduction whatsoever of any amounts paid by Medicaid. This reading of Va. Code § 38.2-1600 et seq. is consistent with all of the cases that have construed the Guaranty Association statutes. See, e.g., Bogle Dev. Co. v. Buie, 250 Va. 431, 434 (1995); Northland Insurance Co. v. Virginia Property & Casualty Insurance Guaranty Ass’n, 240 Va. 115, 118-19 (1990); and Virginia Property & Casualty Insurance Guaranty Association v. International Insurance Co., 238 Va. 702, 706 (1989).

Call, or contact us for a free consult. Also for more info on injury claims against Guaranty Association see the Wikipedia pages. Also see the post on this site dealing with collateral source issues.

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Injury Claims Against Guaranty Association

Injury Claims Against Guaranty Association

Brien Roche

The Virginia Guaranty Association is a state-created entity.  It steps in on behalf of insurance companies that have gone belly-up.  It has the right to defend the defendant.  The defendant is the person that caused the plaintiff’s injury.  The suit then is against the defendant but may be defended by an attorney on behalf of the Guaranty Association and also an attorney on behalf of the actual defendant.  Typically they are the same attorney.

The Guaranty Association, as a state-created entity, is entitled to certain protections.  

Injury Claims against Guaranty Association-Setoff for Medical Bills Paid

The Guaranty Association is entitled to a set-off or reduction of the amount it owes, in the amount actually paid by health insurance.  See MacDougal, 61 Va. Cir. at 220 (“health insurance benefits actually paid are an offset from covered claims”) (emphasis added).  However the Association remains responsible for the entire judgment that might be obtained against the defendant, up to the amount of $300,000 (Va. Code § 38.2-1606(A)(1)), minus the amount actually paid by health insurance.

Therefore if plaintiff obtains a judgment against defendant for $500,000 for her pain and suffering, inconvenience, any wage loss, and her total medical expenses attributable to this collision, the Guaranty Association will be responsible for the total “covered claims” up to the amount of $300,000, minus the amount “actually paid” by health insurance.  In other words the Guaranty Association is responsible for $290,000 of that $500,000 judgment if the benefits actually paid are $10,000.

Exhaustion

There is nothing in the MacDougall case or in Va. Code § 38.2-1600 et seq. to suggest that the Guaranty Association statutes have in any way abrogated or restricted the application of the collateral source rule. Nor are there any other Virginia cases which so hold. The only limited exception or “carve out” to the collateral source rule is found in Va. Code § 38.2-1610 (A) and (A1), which provides for an “exhaustion” of other insurance before the Guaranty Association must pay, and which further provides that the amount payable on a “covered claim . . . shall be reduced by the amount of any recovery under such program” or under an “insurance policy.” (See Va. Code § 38.2-1610 (A) and (A1)). Therefore § 38.2-1610 does not impact the application of the collateral source rule. It just means that, at the end of the case, the Guaranty Association may have a credit or reduction in the amount it owes for Plaintiff’s medical expenses in the amount recovered under Medicaid or some other insurance. 

Injury Claims Against Guaranty Association-Collateral Source Rule

None of the Guaranty Association statutory provisions limit the application of the collateral source rule. In other words, in a personal injury action, Plaintiff will be allowed to put on evidence of medical expenses related to this collision. Furthermore the Defendant (or the Guaranty Association, in the event it defends the defendant) will not be allowed put on evidence or make reference to any payments toward those medical expenses that have been paid by collateral sources, including Medicaid, or any “write-offs” or “write downs” by her medical providers for those medical expenses. See, e.g., Llewellyn v. White, 297 Va. 588, 601 (2019); Radvany v. Davis, 262 Va. 308, 310 (2001); Acuar v. Letourneau, 260 Va. 180, 192 (2000).

So under Virginia law the prohibition against evidence or references to collateral sources likewise applies to amounts covered or paid by Medicaid or Medicare. See, e.g., Ayers v. AFS of Hot Springs, Inc., 2014 Va.LEXIS 20 at *2, 9 (Va. 2014) (Supreme Court agreeing that references to “health insurance, Medicare, Medicaid, ‘write-offs,’ [and] ‘write-downs’” were considered references to inadmissible collateral sources, and that “it is not disputed that counsel for AFS asked a question about collateral source funding in violation of the terms of the agreed upon order in limine”)

Also see Marshall v. Moniz, 2011 Va. Cir. LEXIS 292 at *3 (York Co. Cir. Ct. 2011) (wherein the court granted plaintiff’s motion in limine to exclude other collateral sources and that the values, facts, etc., of any insurance, Medicaid, Medicare, Social Security, including disability payments, etc., of Plaintiff shall not be introduced, referred to or otherwise used at trial).

Medicaid et al.

Hence except for the limited “exhaustion of other insurance” or “set-off” provisions of § 38.2-1610, there would be no reduction whatsoever of any amounts paid by Medicaid. This reading of Va. Code § 38.2-1600 et seq. is consistent with all of the cases that have construed the Guaranty Association statutes. See, e.g., Bogle Dev. Co. v. Buie, 250 Va. 431, 434 (1995); Northland Insurance Co. v. Virginia Property & Casualty Insurance Guaranty Ass’n, 240 Va. 115, 118-19 (1990); and Virginia Property & Casualty Insurance Guaranty Association v. International Insurance Co., 238 Va. 702, 706 (1989).

Call, or contact us for a free consult. Also for more info on injury claims against Guaranty Association see the Wikipedia pages. Also see the post on this site dealing with collateral source issues.

Contact Us For A Free Consultation

    Contact Us For A Free Consultation

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