Medical Billing Expert Witness’ Testimony Does Not Breach Georgia’s Collateral Source Rule
Posted on October 7, 2024 by Expert Witness Profiler
This case arises from a high-speed, single vehicle collision into a tree. After the collision, the vehicle caught fire and exploded. Plaintiff Jade Burch was the front seat passenger in the vehicle.
As a result of the collision, Burch broke her pelvis, femur, tibia, and seven ribs. She required emergency leg surgery. Burch also suffered burns on her left foot, which required a skin graft. To date, Burch has incurred over one million dollars of medical expenses and will have at least one more surgery in the future.
Defendant hired Marilyn Pacheco to give testimony “regarding the reasonableness of medical charges for medical services provided.
Pacheco opines that “the $900,343.05 in billed charges on or after 10/25/21 is excessive and the reasonable value of the past medical care received by Plaintiff is $429,553.74.” Plaintiff argued Pacheco’s opinions must be excluded because she is not qualified to offer them, they are unreliable and unhelpful to the trier of fact under Fed. R. Evid. 702 and Daubert and its progeny, and her opinions impermissibly inject collateral source into this case under Georgia law.
Medical Billing Expert Witness
Marilyn Godoy Pacheco has over 30 years of experience in establishing medical charges, medical billing, collections, pricing, and third-party payer contract negotiations and has been qualified and has testified as an expert forensic medical bill auditor in state and federal trials and arbitrations on approximately 638 occasions. She has 18 years of experience managing the medical billing department of a medical practice with 10 physicians; became a Certified Professional Coder from the American Academy of Professional Coders in 2012; founded E&M Billing Services, a medical billing service for multiple independent physician practices filing 1,000 claims per month, in 2004; been the director of Miller Children’s Subspecialty Group since 2005 where she provides oversight of the medical billing department, contract negotiations, and credentialing of 26 specialty medical groups with 90+ physicians; and since 2012, she has provided expert testimony for medical billing and auditing services for Elevate Services, Inc.
Discussion by the Court
A. Pacheco’s Qualifications
Plaintiff first challenged Pacheco’s qualifications, arguing she is not qualified to offer opinions about what an Augusta hospital (or any Georgia hospital) should have charged for Plaintiff’s medical treatment. Plaintiff argued while Pacheco may be qualified to assign the right billing codes to the medical services provided at Doctor’s Hospital, she is not qualified to use those codes to determine a reasonable fee in this case. However, the Court held that the Defendant has met its burden of demonstrating Pacheco is qualified as a medical billing expert.
Plaintiff pointed out that Pacheco held only a high school diploma and lacked formal training in finance or economics. Moreover, she had no professional experience with pricing medical procedures and services in the state of Georgia. Despite this, Pacheco’s extensive experience in medical billing qualified her as an expert. She asserted that no specific academic degree existed for medical billing professionals, who do not need to be physicians or healthcare providers. As a medical billing expert she has specialized knowledge on industry-specific requirements “including ICD-9, ICD-10, CPT, HCPCS, APC, DRG, and NDC coding, rules, and regulations related to each code set and regional/geographic pricing.”
B. Pacheco’s Methodology and Reliability
The Court found Pacheco’s methodology is sufficiently reliable for admissibility, and the weaknesses in the data she relies on in conducting her methodology is appropriately addressed on cross examination. To form her opinions, Pacheco used a multi-step process to review and audit the medical charges to determine the reasonable value of the services provided.
First, Pacheco analyzed Plaintiff’s past medical records, billing data, and medical cost benchmarking resources over the period of Plaintiff’s treatment in Augusta.
Second, she applied geographic-specific pricing to determine the reasonable marketplace value for the same services within the same community within the same year.
Third, she conducted a market analysis of the local medical community for similar services based on published data “to identify additional evidence of reasonable marketplace value and further validate the results of the audit.”
Plaintiff argued Pacheco’s methodology simply consists of plugging codes into databases from which she picks the “reasonable” value for the medical services; she cannot explain the origin of the data in these databases; she did no independent research in the Augusta or Georgia healthcare market to determine what hospitals charge for similar services; and therefore neither the Court nor the jury can test whether the databases are accurate and reliable. But these arguments are appropriately addressed on cross examination.
Moreover, the methodology and data sources Pacheco employed have been peer reviewed in 2013 by Gerard Anderson, Ph.D., a widely known expert in the field of healthcare services pricing, and again in 2023 by a panel of experts including Professor Emeritus Gerald F. Kominski, Ph.D,; Orthopedic Surgeon Stewart L. Shanfield, M.D.; QA Auditor and Coder Vivian Washington, CPC, COC, CPMA, CRC, CPC-1; and Healthcare Administrator Andrew Bowen who found the methodology “sound, reliable, and applied appropriately using industry standard data.”
C. Helpfulness to the Jury
The Court is also unpersuaded by Plaintiff’s contention that Pacheco’s opinions are not helpful to the jury. The average lay person does not know what hospitals charge for healthcare services or understand how they generate the prices. Pacheco’s opinions address coding issues and whether the correct billing codes were applied, removing charges for improper packaged services, which is beyond the understanding of the average lay person and will assist the jury in determining whether Plaintiff’s medical expenses are reasonable.
D. Collateral Source Rule
The collateral source rule bars the Defendant from presenting any evidence as to payment of expenses of a tortious injury paid for by a third party and taking any credit toward the Defendant’s liability and damages for such payments.” But the Eleventh Circuit has rejected this challenge to similar medical billing experts, explaining “Defendants were properly allowed to argue that medical charges were unreasonably high,” and such expert testimony “did not violate the collateral source rule.” Here, Pacheco does not opine that the medical expenses should be reduced by insurance payments, write-offs, or write-downs.
The Court held that her testimony as to how the charged fees compare to the market is relevant to the reasonableness inquiry and does not “purport to present evidence that a third party paid for or should pay for the expenses of the tortious injury allegedly caused by Defendant’s negligence; accordingly the collateral source rule does not apply.”
Held
In conclusion, the Court denied Plaintiff’s motion to exclude the testimony of Defendant’s medical billing expert witness, Marilyn Pacheco.
Key Takeaway:
Not only is Pacheco qualified as a medical billing expert, she used a multi-step process to review and audit the medical charges to determine the reasonable value of the services provided followed by a detailed analysis of Plaintiff’s past medical records, billing data, and medical cost benchmarking resources over the period of Plaintiff’s treatment in Augusta. Moreover, her opinions address coding issues and whether the correct billing codes were applied, removing charges for improper packaged services, which is beyond the understanding of the average lay person and will assist the jury in determining whether Plaintiff’s medical expenses are reasonable.
Case Details:
| Case caption: | Burch v. Cracker Barrel Old Country Store, Inc. |
| Docket Number: | 5:22cv316 |
| Court: | United States District Court for the Middle District of Georgia, Macon Division |
| Dated: | September 30, 2024 |
