Collateral Source

The collateral source rule bars the admissibility of evidence at trial to show that a plaintiff’s losses have been compensated from other sources, such as the plaintiff’s insurance or workers compensation. “Collateral source” refers to damages awarded to plaintiffs for inflated medical expenses that were never actually incurred.

The collateral source rule keeps important information relevant to the determination of damages from reaching the jury. It allows plaintiffs to be compensated twice for the same injury.

ATRA supports permitting the admissibility of evidence of collateral source payments at trial or requiring awards to be offset by the amount paid to plaintiffs by collateral sources, less the amount paid by the plaintiff to secure the benefit. Advancing legislation to allow actual evidence of the medical expenses incurred will bring transparency to damage awards for medical bills.