Assembly Passes Legislation To Promote Fairness
In Legal Proceedings Related To Settlements
For Victims Of Serious Injuries

Legislation to promote fairness in legal proceedings related to settlements paid to injury victims in New York State was approved in the Assembly today, Speaker Sheldon Silver announced.

The two-pronged legislation (A.8364-B/S.5128-A) sponsored by Assembly Judiciary Committee Chair Helene Weinstein addresses the "collateral source" rule by:

• Ending the ability of uniformed public employees in New York State who are injured on the job from suing their employers for medical and disability benefits which they are already receiving as an employment benefit; and,
• Blocking health insurers from recouping medical costs from any pain and suffering award made to an accident victim in a court case.

"This legislation is a necessary next step in a tort litigation reform process that started over two decades ago," Silver said. "Since that time, injury victims with health insurance coverage have not been permitted to sue for covered medical costs but can pursue other damages. However, more recently, health insurers have wrongfully begun to pursue repayment of medical costs from financial settlements received by individuals for other damages -- even though the insurers have already been paid premiums for coverage they agreed to provide."

"When an injured person sues for damages, health insurance companies then turn around and sue for medical expenses it paid out, despite the fact the injured person was legally unable to recover these damages from the wrongdoer in the first place," said Weinstein (D-Brooklyn). "Without this measure, New Yorkers who have paid thousands of dollars in health insurance premiums, who receive a settlement in an injury case, are at risk to lose that entire settlement to the health insurance company."

The collateral source legislation originated from a proposal advanced by the Chief Administrative Judge of the State of New York, at the recommendation of the Civil Practice Advisory Committee of the Office of Court Administration. The Committee, comprised of leading attorneys and law professors, concluded that the public would best be served by preventing health insurers from interfering in litigation in which they were not otherwise involved by bringing reimbursement claims.