VS. SELECT ACTIVE INSURANCE COMPANY OF AMERICA. MAY WE PLEASE
AND APPEARANCES OF COUNSEL. (APPEARANCES OF COUNSEL ENTERED)
CHIEF JUSTICE RABNER: GOOD MORNING, AND WELCOME COUNSEL, MR. WOJCULEWSKI
PLEASE. STANLEY G. WOJCULEWSKI: I'D LIKE TO SERVE TWO
MINUTES FOR REBUTTAL IF I MAY. CHIEF JUSTICE RABNER: THAT'S FINE.
STANLEY G. WOJCULEWSKI: THERE WAS NO INTENTION BY CONGRESS
IN PASSING A MEDICARE LAW IN 1965 TO PREEMPT STATE NO FAULT LAWS FOR VICTIMS OF
MOTOR VEHICLE ACCIDENTS. BY FAR THE MOST PROBATIVE PIECE OF EVIDENCE TO
THAT POINT IS THAT THERE WAS NO STATE NO FAULT LAWS IN EXISTENCE WHEN THE MEDICARE
LAW WAS CRAFTED. CONGRESS COULD NOT HAVE CONTINUE TO OBLIGATE MEDICARE
-- TO IF ANY AHEAD OF ALL OTHER FORMS OF INSURANCE IT WOULD HAVE MADE THAT INTENT
COMPRESS IN THE LEGISLATIVE LANGUAGE ITSELF YET IT DID NOT.
JUSTICE ALBIN: KEEP YOUR VOICE UP. STANLEY G. WOJCULEWSKI: I'LL
DO MY BEST THANK YOU. WE HAVE A CLEAR STATEMENT BY CONGRESS OF THE OPPOSITE
INTENT WHICH IS 42 U.S.C. 1395B WHICH IS QUOTE, NOTHING CONTAINED IN THIS TITLE
SHALL BE CONSTRUED TO PRECLUDE ANY STATE FROM PROVIDING OR ANY INDIVIDUAL
FROM PURCHASING OR OTHERWISE SECURING PROTECTION AGAINST THE COST OF ANY HEALTH
SERVICES. BY CONTRAST, UNDER STATE LAW NO FAULT BENEFITS WERE DESIGNATED
AS THE IMMEDIATE AND PRIMARY SOURCE OF RECOVER RE FOR MEDICAL EXPENSE BENEFITS
INCURRED BY VICTIMS OF MOTOR VEHICLE ACCIDENTS. THE APPELLATE DIVISION
BELOW CONCLUDED THAT UNDER THE 1965 MEDICARE STATUTE MEDICARE WAS MADE PRIMARY
IN ALL CIRCUMSTANCES OTHER THAN WORKERS' COMPENSATION. IN REACHING THIS
CONCLUSION THE COURT FAILED TO CITE TO THE MEDICARE STATUTE ITSELF NOR DID IT
CITE TO ANY FEDERAL RULE OR REGULATIONS. THE COURT'S ONLY CITATION WAS TO A HOUSE
REPORT FROM 1980 WHICH WAS OF COURSE AUTHORED 15 YEARS AFTER THE
LEGISLATION'S PASSAGE. IN RELIANCE ON THIS HOUSE PRESENTENCE REPORT IS PROBLEMATIC
NOT SIMPLY BECAUSE IT WAS NOT A CONTEMPORANEOUS STATEMENT OF
LEGISLATIVE INTENT BUT BECAUSE OF THE NO MEN CLAY SURE USED. THE USE OF THE WORD
PRIMARY WHICH AN INSURANCE INDUSTRY SHORTHAND TERM YET THE FELD INTERPRETED ITS
USE IN THE HOUSE REPORT FROM 1980 TO SHOW AN INTENT BY CONGRESS TO LEGALLY
OBLIGATE MEDICARE TO PAY FIRST AND AN AN INTENT TO PREEMPT ALL OTHER SOURCES OF
COVERAGE. THE USAGE OF THE TERM PRIMARY IN THE HOUSE REPORT IS BEST UNDERSTOOD
AS STATED BY THE FEDERAL CIRCUIT. INSTEAD OF SIMPLY SAYING THAT MEDICARE WAS PRIMARY
THE COURT STATED QUOTE MEDICARE PAID FOR SERVICES WITHOUT REGARD TO WHETHER
THEY WERE ALSO COVERED BY AN BROTHER GROUP PLAN, END QUOTE. MEDICARE MAY HAVE
PAID CLAIMS WITHOUT CONCERNING ITSELF AS TO WHETHER THERE WERE OTHER SOURCES
OF COVERAGE AVAILABLE BUT THIS PRACTICE WAS NOT DICTATED BY THE EXPRESS LANGUAGE
OF THE MEDICARE STATUTE. THE APPELLATE DIVISION FOUND THAT UPHOLDING THE
TRIAL COURT'S DECISION WOULD RESULT IN A CONFLICT BETWEEN STATE LAW AND THE FEDERAL
MEDICARE BILLING SCHEME WITHOUT UNDERTAKING A PROPER CONFLICT IN
PREEMPTION ANALYSIS. I DON'T BELIEVE THAT THAT ASPECT OF THE CASE WAS FULLY BRIEFED.
WE WOULD SUBMIT, HOWEVER, THAT THERE WAS NO ACTUAL CONFLICT BECAUSE BOTH
STATUTES CAN OPERATE CONSISTENT WITH THIS COURT EXTENSIVE TREATMENT OF CONFLICT
ANALYSIS IN THE HAGZ GESTURE VS. M AND K INSTRUCTION, THE PRE SECONDARY PAY
YOUR ALLOWED ROOM FOR THAT THE NEW JERSEY NO FAULT LAW TO OPERATE WITHIN THE PRESCRIBED
SPHERE. WE MUST START WITH THE NO FAULT LAW ITSELF WHICH IS 39:6A-FOUR. THAT
PROVIDES THAT AUTO POLICIES SHALL PROVIDE COVERAGE FROM PAYMENT OF MEDICAL
EXPENSES TO INJURED VICTIMS OF MOTOR VEHICLE ACCIDENTS. THIS IS NOT PERMISSIVE
LANGUAGE. CLEAR CASE LAW HAS ESTABLISHED THAT THE NO FAULT LAW IS INTENDED
TO BE THE IMMEDIATE AND PRIMARY SOURCE OF RECOVERY FOR AUTO ACCIDENT VICTIMS.
WE MUST, OF COURSE, ALSO LOOK AT THE COLLATERAL SOURCE RULE, 39:6A-SIX.
THE APPELLATE DIVISION'S INTERPRETATION OF THE EFFECT OF THE COLLATERAL SOURCE RULE
HAS SHIFTED OVER THE YEARS FROM REQUIRING A DEDUCTION FROM PIP'S OBLIGATION
OF ANY BENEFITS COLLECTIBLE FROM A PRIMARY SOURCE AS STATED IN THE OLD RELY VERO
CASE TO OUTRIGHT BARRING ANY RECOVERY FROM PIP AS WE SEE IN THE 2016 CASES OF
LAND BERT AND TALMADGE, EFFECTIVING RELIEVING THE PIP CARRIER OF ANY BURDEN WHERE
A COLLATERAL SOURCE IS COLLECTIBLE. IN THAT MATTER THIS COURT HELD QUOTE
THE AVAILABILITY OF WORKERS' COMPENSATION NOT NOT PRECLUDE AN INSURED OR HIS AGO
SIGNIFICANT KNEE FROM SEEKING THE RANGE OF REMAND DEE PURSUANT TO AVAILABLE
TO PIP. IN HARDING THIS COURT ALSO CITED OLIVERO WITH APPROVAL FOR THE PROPOSITION
THAT THE INTENT BY THE PIP COLLATERAL SOURCE RULE WAS NOT TO PRECLUDE
RECOVERY FROM PIP BUT TO PREVENT DOUBLE RECOVERY BY REQUIRING THE DEDUCTION FROM
THE PIP OBLIGATION AND ANY ACTUAL PAYMENT OF COLLATERAL SOURCES AS LISTED
IN 39:SIX A.-SIX. THE APPELLATE DIVISION BELOW FOUND INTERPRETING THE COLLATERAL
SOURCE RULE TO OBLIGATE PIP TO PAY FIRST SUBJECT TO ANSWERS OFF CENTERED
OR DEDUCTION BY WHATEVER MEDICARE PAID WOULD CONFLICT WITH FEDERAL LAW AGAIN WITHOUT
CONDUCTING A PROPER CONFLICT ANALYSIS. THERE WERE ALSO A NUMBER OF WHAT
I WOULD CALL EQUITABLE AND PUBLIC POLICY LAWS NOT ADDRESSED BY THE APPELLATE DIVISION.
WE CITED THE GENERAL RULE AS STATED IN GEICO THAT AN INSURED SHOULD NOT
BE PERMITTED TO REACH THE BENEFIT OF A WRONGFUL DENIAL. COOPER BILL SELECTIVE
AND TOOK SELECTIVE'S DENIAL STATING MEDICARE WAS PRIMARY AT FACE VALUE.
RESPONDENT ARGUES THAT PAYMENT FOR THAT CLOSES PETITIONER FROM BILLING NO FAULT
UNDER THE STATUTE, 42 U.S. CODE SECTION 1395 C C-1A1. IT WOULD BE AGAINST
PUBLIC POLICY TO ALLOW A NO FAULT INSURER TO BENEFIT BY DISREGARDING ITS PRIMARY
RESPONSIBILITY TO PAY UNDER STATE LAW IN THE HOPES THAT MEDICARE WILL STEP IN AND
ISSUE PAYMENT THUS INSULATING THE NO FAULT INSURER FROM ANY LIABILITY OTHER THAN
THE MEDICARE OUT OF POCKET COSTS. NONE OF THESE WHAT I WOULD CALL EQUITABLE AND
POLICY ARGUMENTS WERE ADDRESSED BY THE APPELLATE DIVISION BUT THEY DO SUPPORT
SPIRITING PETITIONER TO PURSUE WHAT IT SHOULD HAVE RIGHTLY BEEN PAID BY
SELECTIVE. I WOULD ALSO LIKE TO BRIEFLY ADDRESS THE LIMITING STATUTE WHICH I JUST
DISCUSSED, TO CHARGE ANY INDIVIDUAL OR OTHER PERSON FOR ITEMS OR SERVICES FOR
WHICH SUCH INDIVIDUAL IS ENTITLED TO HAVE PAYMENT MADE UNDER THE SUBCHAPTER MEANING
THE MEDICARE STATUTE. OTHER THAN MEDICARE DEDUCTIBLES AND CO PAYS. THE QUESTION
IS DID CONGRESS INTENT ANY INDIVIDUAL OR PERSON TO NEAT AN AUBL PAYING STATUTORY
BENEFITS WHICH WOULD EFFECTIVELY PRE-SETTLEMENT THE ENTITLEMENT YOU
BELIEVE STATE LAW. DOES THAT INCLUDE A SITUATION WHERE ANOTHER PAYER HAS THE LEGAL
RESPONSIBILITY TO PAY BASED ON STATE LAW. GEM, I DON'T BELIEVE ANY AUTHORITY HAS
BEEN SET FORTH TO SUPPORT THAT OPINION. THIS PROVISION IS CLEARLY INTENDS
TO DO PREVENT DOUBLE RECOVERY AND PROTECT THE BENEFICIARY FROM BALANCED BILLING
BEYOND THE MEDICARE ALLOWABLE AMOUNT. COOPER IS NOT RECEIVING DOUBLE
RECOVERY UNDER THE CIRCUMSTANCES AND NO ONE IS ASKING THE BENEFICIARY FOR ANYTHING.
ALL THE EXPENSES WOULD BE COVERED AND THE BENEFICIARY WOULD HAVE ZERO OUT OF
POCKET SXENLS. I BELIEVE THIS COURT SHOULD ENDEAVOR TO REACH THE RESULT IT BEST
DHAEFD IN THE CLEARLY STATED POLICY GOALS. WE SHOULD NOT BE CONSTRUING
FEDERAL AND STATE LAWS TO PLACE UPON MEDICARE A BURDEN THAT WAS AT LEAST SINCE
THE PASSAGE OF THE NO FAULT LAW IN 1972 EXPRESSLY INTENDED BY THE NEW JERSEY
LEGISLATURE TO BE BORN BY FLO FAULT CARRIERS. WITH THE PASSAGE OF THE MEDICARE
SECONDARY PAYER PROVISIONS CONGRESS CLEARLY INTENDED TO SHIFTED AS MUCH
RESPONSIBILITY AWAY FROM MEDICARE AS TO MANY OTHER SOURCES OF COVERAGE AS POSSIBLE
TO PREFERABLE MEDICARE'S CONTINUED FISCAL INTEGRITY, INCLUDING STATE AUTOMOBILE
NO-FAULT INSURANCE. I BELIEVE REINSTATING THE TRIAL COURT'S HOLDING ACHIEVES THE GOALS
OF BOTH FEDERAL AND STATE LAWS AT ISSUE. UNLESS THE JUSTICES -- HAVE ANY
QUESTIONS. JUSTICE ALBIN: SO NO-FAULT INSURANCE AND PARTICULARLYLY
COLLATERAL SOURCE RULE 396A6, IS ILLUSTRATES ON THE PART PAST LEGISLATURE AN
INTENT TO SHIFT AWAY FROM AUTOMOBILE INSURANCE BUSHDZ PLACED UPON WORKERS'
COMP. AND MEDICARE, YOU AGREE. STANLEY G. WOJCULEWSKI: THE ACTUAL
LANGUAGE IN THE STATUTE IS DEDUCTED FROM. JUSTICE ALBIN:
EXACTLY. SO IS IT FAIR TO SAY BASED UPON OUR JURISPRUDENCE AND EVEN OUR MOST
RECENT DECISION IN SANCHEZ, BOTH THE CONCURRING AND DISSENTING OPINIONS.
LET'S JUST TAKE WORKERS' COMPENSATION, IT'S SITTING RIGHT NEXT TO MEDICARE.
THAT WORKERS' COMPENSATION IS PRIMARY. SO THERE'S AN AUTOMOBILE ACCIDENT ON THE
JOB, WORKERS' COMPENSATION COMES FIRST, CORRECT. STANLEY G.
WOJCULEWSKI: AGAIN, IT DEPENDS ON THE USE OF THE WORD PRIMARY. I THINK THAT'S
A STICKY SITUATION BECAUSE PRIMARY IS NOT -- JUSTICE ALBIN:
LET ME MAKE IT SIMPLE THEN. IF WORKERS' COMPENSATION PAID FOR EVERYTHING YOU
WOULDN'T LOOK TO PIP, CORRECT. STANLEY G. WOJCULEWSKI: THERE
WOULD BE NO PIP OBLIGATION. JUSTICE ALBIN: OKAY. SO ACCEPT
MY TERM OF PRIMARY IN THAT FASHION. WHAT GOES FIRST IS WORKERS' COMPENSATION.
AND UNDER OUR COLLATERAL SOURCE RULE MEDICARE IS RIGHT NEXT TO IT. MEDICARE COMES
FIRST, TOO, CORRECT? STANLEY G. WOJCULEWSKI: IT DOES. IN THE
STATUTE. JUSTICE ALBIN: SO NOW WE'LL TAKE THAT'S IN
OUR STATUTE, THAT WAS OUR STATUTE IN 1977, THAT'S OUR STATUTE TODAY. NOW WE'RE
DEALING WITH MEDICARE AS IT EXISTED IN 1977, CORRECT? STANLEY
G. WOJCULEWSKI: YES. JUSTICE ALBIN: OKAY. COOPER HOSPITAL -- SO
MEDICARE IS FIRST. COOPER HOSPITAL HAS A CONTRACT WITH NARROWED.
STANLEY G. WOJCULEWSKI: THEY DO. JUSTICE ALBIN: THAT REQUIRES COOPER
HOSPITAL TO ACCEPT THE TERMS OF PAYMENT, CORRECT? STANLEY G.
WOJCULEWSKI: UNDER WHAT WE DISCUSSED, YES, THE LIMITING CHARGE --
JUSTICE ALBIN: I'M NOT GOING TO GO ALL THROUGH THE REGULATIONS AND STATUTES BUT
THERE -- YEAH. STANLEY G. WOJCULEWSKI: THEY AGREED TO ABIDE
BY MEDICARE'S RULES AND REGULATIONS IN BILLING AND ACCEPTING.
JUSTICE ALBIN: RIGHT. AND THAT AGREEMENT SAID MEDICARE IS BASICALLY THE SOLE SOURCE.
DO YOU BILL THE PATIENT FOR MEDICARE, YOU CAN'T BILL THE PATIENT -- YOU CAN'T
BILL THE PATIENT FOR ANYTHING ELSE. STANLEY G. WOJCULEWSKI:
YOU CAN'T BILL THE PATIENT, CORRECT. JUSTICE ALBIN: THE STATUTE
ALSO HAS -- YOU CAN'T PAY -- I DON'T HAVE THE PRECISE LANGUAGE IN FRONT OF
ME YOU CAN'T BILL THE PATIENT AND YOU CAN'T BUILD BASICALLY ANYONE ELSE.
STANLEY G. WOJCULEWSKI: ANY OTHER PERSON. JUSTICE ALBIN: OKAY.
SO WE KNOW IN THE LAW PERSON HAS BEEN CONSTRUED TO BE A CORPORATION.
PERSONS ARE INDIVIDUALS AND PERSON ARE CORPORATIONS, CORRECT?
STANLEY G. WOJCULEWSKI: YES. JUSTICE ALBIN: AN INSURANCE COMPANY
IS A CORPORATION, CORRECT? STANLEY G. WOJCULEWSKI: IT IS.
JUSTICE ALBIN: SO UNDER THE LAW IT'S A PERSON.
STANLEY G. WOJCULEWSKI: I THINK THERE IS A DISTINCTION TO BE MADE BECAUSE THE
INSURANCE COMPANY IS PAYING BENEFITS BASED ON STATE LAW AS OPPOSED TO SIMPLY A
CONTRACT THAT EXISTS BETWEEN IT AND A BENEFICIARY. THE BENEFITS ARE
PROVIDED AND COMPULSORY UNDER STATE LAW. AN AUTOMOBILE CARRIER IN THE STATE DOESN'T
HAVE THE CHOICE WHETHER OR NOT TO ARGUE -- JUSTICE ALBIN:
SO FROM YOUR PERSPECTIVE IT'S THE ONLY PERSON WHO WASN'T A PERSON UNDER THE
STATUTE IS AN INSURANCE COMPANY, A PERSON WILL BE OTHER CORPORATIONS.
STANLEY G. WOJCULEWSKI: WHAT I WOULD SAY IS WE DO NOT HAVE A STATEMENT OF INTENT
BY CONGRESS THAT WHEN IT TALKS ABOUT AN INDIVIDUAL PERSON THAT WAS INTENDED TO
PRECLUDE RECOVERY UNDER STATE LAW OF ANY OTHER BENEFITS ESPECIALLY BENEFITS THAT
DIDN'T EXIST -- JUSTICE ALBIN: IS THERE ANYTHING IN EITHER
FEDERAL LAW OR IN STATE LAW THAT SAYS THAT A CORPORATION IS NOT A PERSON UNDER THE
LAW? STANLEY G. WOJCULEWSKI: NO, NOT THAT I'M AWARE OF, NOT
THAT I'M AWARE OF. JUSTICE LA VECCHIA: CAN WE GO BACK IN TIME?
AT THE TIME OF THIS INDIVIDUAL'S ACCIDENT HE WAS NOT ELIGIBLE FOR MEDICARE, WAS
HE. STANLEY G. WOJCULEWSKI: THAT'S CORRECT. THE CHRONOLOGY
IS IN 1977 I BELIEVE HE WAS 23 YEARS OLD. HE WAS INVOLVED IN AN ACCIDENT IN CALIFORNIA.
HE WAS INJURED AND HE DID NOT BECOME A MEDICARE -- LET ME -- ALL RIGHT.
SO HE WAS INVOLVED IN THE ACCIDENT IN 1977. VIA A COURT ACTION IN 1979 AN ORDER
WAS ENTERED PROVIDING THAT SELECTIVE WILL PAY FOR MR. MECOUCH'S MEDICALLY
NECESSARY EXPENSES ARISING OUT OF HIS AUTOMOBILE ACCIDENT.
JUSTICE LA VECCHIA: PURSUANT TO PIP AND OBLIGATION UNDER STATE LAW. THAT HAS NEVER
BEEN AMENDED OR RESCINDED. STANLEY G. WOJCULEWSKI: IT HAS
NOT. AT SOME POINT HE BECAME A MEDICARE BENEFICIARY NOT BASED ON AGE BUT
BASED ON THE FACT THAT HE WAS DISABLED FOR TWO YEARS. AT WHICH POINT HE WAS ELIGIBLE.
JUSTICE LA VECCHIA: MY QUESTION TO YOU IS WHAT IS THE
MECHANISM THAT ELIMINATES THE LEGAL OBLIGATION THAT A JUDICIAL ORDER HAS IMPOSED
ON SELECTIVE TO COVER THE MEDICAL EXPENSES AND SEQUELA THAT CAME FROM THAT
ORIGINAL AUTOMOBILE ACCIDENT AND NOW SHIFTS IT AS A MANDATORY OBLIGATION TO
MEDICARE AS -- TO USE JUSTICE ALBIN'S TERM, PRIMARY OBL RELY GORE -- ALTHOUGH
PRIMARY DOESN'T APPEAR -- STANLEY G. WOJCULEWSKI: I DON'T BELIEVE
THERE IS SUCH A MECHANISM. JUSTICE PATTERSON: YOUR ADVERSARY
IS RELYING ON BOTH FEDERAL AND STATE STATUTES. STANLEY G.
WOJCULEWSKI: YES. JUSTICE PATTERSON: SO AS TO THE FEDERAL
STATUTES THERE IS A PREEMPTION ARGUMENT, CORRECT. STANLEY G. WOJCULEWSKI:
YES. JUSTICE PATTERSON: THEIR ARGUMENT WOULD BE THAT IF THE
COURT ORDER WERE INCONSISTENT AS IT HAS TURNED OUT AND THE EVENTS THAT HAVE HAPPENED
OVER MANY YEARS IN THIS CASE, TURNS OUT TO BE INCONSISTENT WITH FEDERAL
LAW, THAT COURT ORDER IS PREEMPTED. STANLEY G. WOJCULEWSKI: IT WOULD
HAVE TO YIELD TO FEDERAL LAW, AGAIN, THE QUESTION IS DOES FEDERAL LAW PREEMPT
IN THIS AREA WHICH IS AGAIN THE RECOVERY OF MEDICAL EXPENSES FOR AUTOMOBILE.
JUSTICE LA VECCHIA: WHEN I EXAMINE ALL OF THESE OUT-OF-STATE JURISDICTION
CASES THAT RECITE THE SECONDARY PAY YOUR STATUTE THEY'RE NOT SAYING MEDICARE
MUST BE PRIMARY IN ANY ONE OF THEM, DO THEY? STANLEY G. WOJCULEWSKI:
YOU ARE EXACTLY RIGHT. JUSTICE LA VECCHIA: YET THOSE ARE THE SAME
CASES THAT ARE CITED OVER AND OVER AGAIN AS INTERPRETING THE MEDICARE SECONDARY
PAY YOUR ACT AS IF IT HAS RETROACTIVELY IMPOSED A PRIMARY PAYMENT OBLIGATION
ON MEDICARE FOR PRE 1980 INJURIES. STANLEY G. WOJCULEWSKI: THAT'S
EXACTLY RIGHT. AND THE REASONING IS WELL NOW THAT AUTOMOBILE IS SPECIFICALLY
DESIGNATED AS SECONDARY UNDER THE MSP PROVISIONS IT MUST HAVE BEEN PRIMARY BEFORE
BUT THERE WAS NOTHING IN THE MEDICARE STATUTE ITSELF THAT SAID THAT.
JUSTICE PATTERSON: YOU MENTIONED TALMADGE AND LAMBERT AND THEY'RE
OBVIOUSLY COMP. CASES AS IS SANCHEZ, ARE YOU SUGGESTING THAT THERE IS A DISTINCTION
TO BE DRAWN BETWEEN MEDICARE AND THOSE COMP. CASES OR ARE YOU SUGGESTING
BECAUSE I THOUGHT FROM YOUR COMMENTS YOU THINK THOSE CASES WERE WRONG.
STANLEY G. WOJCULEWSKI: I THINK THEY WERE WRONG LG DECIDED AGAIN SPECIFICALLY
BECAUSE THEY CONFLICT WITH WHAT I BELIEVE IS A VERY CLEAR HOLDING IN HARDY
VS. N.J. M. JUSTICE LA VECCHIA: THERE IS A DISTINCTION TO BE
MADE IS THERE NOT. STANLEY G. WOJCULEWSKI: YES.
JUSTICE LA VECCHIA: BECAUSE UNDER COMP. THERE IS A SEPARATE STATUTORY OBLIGATION
THAT COMPELS PAYMENT FROM THE BEGINNING AND FOR THE PROVISION OF MEDICAL
SERVICES DIRECTLY BY THE COMP. INSURE YEAR CARRIER TO THE INJURED EMPLOYEE OF THE
EMPLOYER. STANLEY G. WOJCULEWSKI: YES.
JUSTICE LA VECCHIA: WE DON'T HAVE THE SAME SITUATION WITH REGARD TO MEDICARE AND
THAT'S WHY I ASKED YOU THE QUESTION THAT I DID BEFORE. THIS INDIVIDUAL
WAS NOT MEDICARE ELIGIBLE AT THE TIME OF THIS ACCIDENT. IF HE HAD BEEN 68, 70
AT THE TIME OF THIS INJURY WE BITE HAVE A DIFFERENT KIND OF ARGUMENT AND
EXCHANGE GOING ON. BUT WE DON'T. WE HAVE SOMEBODY WHO WAS CLEARLY NOT ELIGIBLE
AND WOULD NOT BE ELIGIBLE TO EVEN REQUEST ANY PAYMENT FOR MEDICARE FOR TWO YEARS
AFTER THIS CATASTROPHIC INJURY TOOK PLACE, CORRECT. STANLEY G.
WOJCULEWSKI: YES. JUSTICE LA VECCHIA: DOESN'T IT MAKE SENSE THAT
THE LEGISLATURE WOULD HAVE INCLUDED A REFERENCE TO MEDICARE IN THE ORIGINAL 1972
VERSION OF THE COLLATERAL SOURCE STATUTE AND USED TERMS LIKE CLEBL ABOUT AS IF
IT WAS ACTUALLY BE RECEIVED. STANLEY G. WOJCULEWSKI: THAT IS
CORRECT AND THAT'S WHERE I THINK CASES LIKE TALMADGE FAIL IS BECAUSE THEY
VIEW IT AS WELL, IT CUTS OFF ANY RECOVERY AS OPPOSED TO COLLECTIBLE SOMETHING THAT'S
ACTUALLY A TANGIBLE OBLIGATION. JUSTICE LA VECCHIA: THE APPELLATE
DIVISION USES THAT LANGUAGE AND YET THE DOUBLE RECOVERY LANGUAGE USED TO
APPEAR IN EARLIER CASE LAW TALKING ABOUT THE COLLATERAL SOURCE BILL AS IT DID IN
LEGISLATIVE HISTORY. STANLEY G. WOJCULEWSKI: PLUS I THINK
THERE'S AN SOUTH THAT IF WORKERS' COMPENSATION PAYS THERE COULD NEVER BE
AN OVER LOAD BETWEEN TWO AND PIP. THERE ARE EXPENSES THEORETICALLY, BUT UNDER
WORKERS' COMPENSATION WHO WOULD PAY FOR THAT. PIP COUPLE CONCEIVABLY PAY
FOR IT. THEY WOULD BE ENTITLED THAT R TO A DEDUCTION BUT THEY COULD STILL BE ON THE
HOOK FOR THOSE EXPENSES NOT COVERED BY MEDICARE. JUSTICE ALBIN:
OUR STATUTE IN FEDERAL LAW TO GET THE RESULT THAT YOU WANT, BECAUSE UNDER 396 A.
SIX WE KNOW THAT MEDICARE IS THE COLLATERAL SOURCE, CORRECT.
STANLEY G. WOJCULEWSKI: YES. JUSTICE ALBIN: WE ALSO KNOW
THAT UNDER FEDERAL LAW, SINCE YOU ARE MEDICARE CONTRACTED WITH THE STATE
AND THE FEDERAL GOVERNMENT, THAT YOU CAN ONLY CHARGE UNDER A CERTAIN SCHEDULE AND YOU
CAN'T CHARGE THE INDIVIDUAL ANYTHING MORE. SO IF I'M LOOKING AT OUR STATUTE
AND SAYING THAT'S A COLLATERAL SOURCE AND THE PATIENT NOW IS UNDER MEDICARE, I DON'T SEE
HOW WE GET TO WHERE YOU WANT TO GET US. STANLEY G. WOJCULEWSKI:
AGAIN, THE LIMITING CHARGE STATUTE AGAIN WHICH IS WHAT JUSTICE IS DISCUSSING
WE AGREE NOT TO CHARGE ANY INDIVIDUAL OTHER PERSON AND AGAIN WE'VE DISCUSSED THE
CORPORATION ASPECT. AND THEN THERE'S THE STATEMENT FOR WHICH AN INDIVIDUAL
IS ENTITLED TO HAVE PAYMENT MADE. SO THEN IT'S -- IF YOU HAVE A SITUATION WHERE
THERE IS A STATE OBLIGATION THERE'S A STATUTE OUT THERE THAT SAYS THIS
PATIENT IS ENTITLED TO NO FAULT BENEFITS UNDER STATE LAW. WHERE THIS STATE'S
LEGISLATURE HAS CLEARLY INDICATED THAT'S THE PRIMARY SOURCE OF RECOVERY.
JUSTICE PATTERSON: EITHER OF THOSE ARGUMENTS HOWEVER REALLY RUN WHAT YOU'RE
SAYING UP AGAINST LAMBERT TALMADGE AND SANCHEZ. STANLEY G.
WOJCULEWSKI: I THINK THOSE CASES HAVE TO BE -- JUSTICE PATTERSON:
YOU STATDZ TO TALK ABOUT THE DIFFERENCE BETWEEN WORKERS' COMPENSATION AND
MEDICARE. STANLEY G. WOJCULEWSKI: I DIDN'T QUITE FINISH
THAT THOUGHT DUE TO A QUESTION BUT WHAT I WAS GOING TO SAY IS THAT MEDICARE AND PENINSULA
ARE BOTH CREATES OF THE NEW JERSEY LEGISLATURE. WHEN THIS COURT HAS
CONSIDERED THE COLLATERAL SOURCE RULE IN REGARD TO THESE THEY'VE LOOKED AT LEGISLATIVE
P INTENT BEHIND WORKERS' COMPENSATION AND BEHIND HIP AND HAVE BEEN ABLE TO
HARMONIZE THOSE. JUSTICE PATTERSON: PIP THAT'S A CREATION OF
THE NEW JERSEY LEGISLATURE. STANLEY G. WOJCULEWSKI: WHEN YOU LOOK
AT TALMADGE AND LAMBERT AND THOSE CASES AND SANCHEZ, THE COURT IS ASKED
TO CONSIDER WHAT WAS THE LEGISLATIVE INTENT BEHIND WORKERS' COMPENSATION AND HOW
WAS IT INTENDED TO WORK VIS-�-VIS PIPT WHERE YOU THIS OTHER SOURCE OF
BENEFITS AVAILABLE. JUSTICE ALBIN: SO THE ONE THING THAT WE DO
KNOW ABOUT 396A6, TEMD IF I'M MISTAKEN IS THAT THE LEGISLATURE WAS ATTEMPTING TO
DECREASE THE COST ON OUR AUTOMOBILE'S INSURANCE INDUSTRY. THE LEGISLATURE HAS
REPEATEDLY ATTEMPTED TO KEEP DOWN PREMIUMS. PART OF THE SHIFT TO
MEDICARE HERE, THE STATE POLICY IS NOT TO PLACE THINGS IN THE PIP CATEGORY WHEN THEY
COULD BE PLACED IN THE WORKMEN'S COMP. CATEGORY OR THE MEDICARE BECAUSE THAT
IS GOING TO LESSEN THE COST OF AUTOMOBILE INSURANCE PREMIUMS. THAT WAS THE
LEGISLATURE'S POLICY, DO YOU AGREE? STANLEY G. WOJCULEWSKI:
I THINK THEORETICALLY AIM IN THE SURE WHEN THAT WAS BEING PUT IN. THAT'S
RIGHT IN THE BEGINNING IN 1972 THEY WERE EVEN LOOKING AT WHAT IS THIS GOING TO
COST AND HOW CAN WE LOWER THE BURDEN ON THE AVERAGE CONSUMER. THAT DIDN'T
COME INTO PLACE UNTIL MANY YEARS LATER. JUSTICE ALBIN: SO I AGREE WITH
YOU, OVER THE YEARS, THE LEGISLATURE GOT KEYED IN TO TRYING TO SAVE BUT EVEN
BACK THEN IN 1972 WITH THOSE EXCEPTIONS, EXCEPTIONS OF WORKERS' COMP. AND MEDICARE,
THE LEGISLATURE WAS STILL WISE ENOUGH TO FIGURE OUT THAT THIS IS A WAY OF
SAVING COSTS WITHIN THE AUTOMOBILE INSURANCE PREMIUM CATEGORY. WOULD YOU AGREE.
STANLEY G. WOJCULEWSKI: I THINK WHAT THEY SAW WAS THAT MEDICARE
AS A PRACTICE PAID WITHOUT CONSIDERATION OF IF THERE WERE OTHER SOURCES,
THEREFORE, LET THEM CONTINUE TO DO THAT VIS-�-VIS PIP AND WE'LL LET THEM CONTINUE
TO DO THAT AND I THINK AGAIN IT'S IMPORTANT TO CONSIDER THE FACT THAT
COLLATERAL SOURCE DOESN'T USE THE WORD PRIMARY NOR DOES IT ELIMINATE ANY DEDUCTION.
JUSTICE PATTERSON: WORKERS' COMP. AND MEDICARE ON EXACTLY
THE SAME PLANE. STANLEY G. WOJCULEWSKI: IT DOES.
JUSTICE PATTERSON: WHERE DOES THAT LEAD US. STANLEY G.
WOJCULEWSKI: AGAIN I TRIED IT MAKE THIS POINT AND SORT OF WE GO ON A BIT OF A DETOUR
BUT THE TALMADGE AND LAMBERT CASES IS ARE YOU INTERPRETING AS IT YOU'RE
EXTINGUISHING THE PIP OBLIGATION. JUSTICE ALBIN: ASSUME THAT
MEDICARE, OKAY, PAID ALL -- BACK THEN, PAID THE ENTIRE BILL, YOU WOULDN'T
LOOK TO PIP, WOULD YOU. STANLEY G. WOJCULEWSKI: THERE WOULD BE NO
OBLIGATION, THERE WOULD BE NOTHING TO DEDUCT -- JUSTICE ALBIN:
BECAUSE MEDICARE IS PRIMARY IN THAT SENSE. YOU LOOK TO MEDICARE FIRST, CORRECT.
STANLEY G. WOJCULEWSKI: WELL, AGAIN I DON'T THINK THERE'S ANYTHING
-- I THINK YOU HAVE TO LOOK AT THE FEDERAL -- JUSTICE ALBIN:
I'M LOOKING AT OUR STATUTE. I'M LOOKING AT 396A6. IF MEDICARE FOOTED THE ENTIRE
BILL PIP WOULD BE OFF THE HOOK, CORRECT? STANLEY G. WOJCULEWSKI:
YES. BUT I DON'T THINK THE STATUTE SAYS THAT YOU HAVE TO BILL THE OTHER --
THE COLLATERAL SOURCE FIRST. IT DOESN'T SAY THAT. JUSTICE ALBIN:
REGARDLESS OF WHO YOU BILLED FIRST IF MEDICARE PAID THE ENTIRE THING PIP
WOULD BE OFF THE HOOK. STANLEY G. WOJCULEWSKI: THAT'S CORRECT.
BUT THAT'S NOT THE CASE HERE. THERE IS A HUGE DISPARITY BETWEEN WHAT MEDICARE
WOULD PAY VERSUS WHAT PIP WOULD PAY. JUSTICE PATTERSON: IN TERMS
OF THE PIM OBLIGATION GETTING THE MONEY FROM PIP QUICKLY IS NOT THE END
OF THE ISSUE UNDER THE PIP STATUTE, CORRECT. STANLEY G. WOJCULEWSKI:
RIGHT. JUSTICE PATTERSON: THAT COULD TURN OUT TO BE A VERY
TEMPORARY SITUATION. STANLEY G. WOJCULEWSKI: YES.
JUSTICE PATTERSON: THIS IS AN UNUSUAL CASE. WE HAVE AN INJURY BACK IN WHAT 1977
AND WE HAVE A HOSPITALIZATION IN 2016. ARE YOU AWARE OF ANY OTHER CASE
OUT THAT THAT. STANLEY G. WOJCULEWSKI: WHAT I WOULD SAY IS
THAT NOT FROM WHAT WE'VE SUBMITTED BUT THE INSURANCE COUNCIL DID SUBMIT A BRIEF
BELOW WHERE THEY HAD INDICATED THAT ACCORDING NO THEIR RESEARCH THEY WERE
APPROXIMATELY 150 SUCH PERSONS IN THE STATE THAT WERE INJURED IN ACCIDENTS BACK
WHEN PIP BENEFITS WERE UNLIMITED THAT CONTINUED TO THIS DAY IT RECEIVE ONGOING
TREATMENT. AND IF YOU REASON THAT OUT THESE PERSONS NOW, THAT WAS 40 YEARS
AGO, ARE GOING TO BE GETTING TO THE POINT WHERE THEY ARE ELIGIBLE FOR MEDICARE
BASED ON THEIR AGE SO YOU'RE GOING TO HAVE AN OVERLAP WITH THESE PERSONS
WHO COULD CONCEIVABLY COLLECT FROM BOTH PIM AND MEDICARE. JUSTICE
PATTERSON: WHETHER THEY GET TO THAT POINT BEFORE THEY ARE ELIGIBLE BECAUSE OF THEIR
AGE MEDICARE IS PRIMARY. STANLEY G. WOJCULEWSKI: WELL MEDICARE
-- JUSTICE PATTERSON: YOU ADOPT LIKE THE WORD PRIMARY. BUT
MEDICARE WOULD PRESUMABLY IF THERE WAS A HOSPITALIZATION THAT HAPPENS IN WHATEVER
YEAR THAT HAPPENS. STANLEY G. WOJCULEWSKI: IF YOU TAKE THE
AUTOMOBILE ACCIDENT ASPECT OF IT, YES, MEDICARE WOULD BE THEIR PRIMARY.
JUSTICE PATTERSON: EVEN -- WHEN THEY WERE ELIGIBLE FOR MEDICARE
BASED ON AGE AS OPPOSED TO DISABILITY ACE THIS GENTLEMAN UNFORTUNATELY TERRIBLY
INJURED AT 23, YOU WOULD NOT CONTEST THAT MEDICARE PAYS.
STANLEY G. WOJCULEWSKI: AGAIN, I WOULD AND I THINK THAT'S ANALOGOUS TO THE SCENARIO.
BECAUSE THE CMS, IT MAY NOT HAVE BEEN THEM BECOME THEN BUT WHOEVER WAS
ADMINISTRATIVING MEDICARE AND FORMULATING THE REGULATIONS DECIDED WE'RE GOING TO
PUT A CUT ALREADY DATE OF DECEMBER 5TH IN 1980 AND IT'S NOT THAT WE'RE GOING TO
DESIGNATE EVERYTHING BEFORE THAT AS MEDICARE BEING PRIMARY. BUT WE'RE NOT GOING TO LOOK
AT A CLAIM THAT'S SUBMITTED FOR AN AUTOMOBILE ACCIDENT PRIOR TO DECEMBER
5TH, 1980 WE'RE NOT GOING TO DENY BENEFITS SOLELY BECAUSE AS IT AUTOMOBILE AND WE'RE
IN THE GOING TO ASK FOR OUR MONEY BACK. THAT'S ANOTHER ASPECT OF THE MEDICARE
SECONDARY PAY YOUR ACT IS MEDICARE CAN ASK FOR MONEY BACK FROM PIM OR SEVERAL OTHER
SOURCES. SO THEY DECIDED THAT'S GOING TO BE OUR CUT OFF DATE AND THAT'S
WHAT WE'RE GOING TO GO WITH BUT IT DOESN'T RETROACTIVELY MAKE MEDICARE PRIMARY.
JUSTICE ALBIN: DON'T YOU THINK THAT THE SECONDARY PAY YOUR
ACT SHEDS LIGHT ON WHAT THE ACT MEANT. CONGRESS WAS TRYING TO DO THE SAME THING
WE WERE DOING IN OUR NO FAULT. THEY'RE TRYING TO SAVE MEDICARE. AND IN ORDER
TO TRY TO SAVE MEDICARE'S THEY WERE SHIFTING THE COST TO OTHER PEOPLE. AND HERE,
NOW UNDER FEDERAL LAW NOW WE'RE SHIFTING IT TO THE AUTOMOBILE INSURANCE
CARRIERS AND TO NO FAULT. YOU COME BEFORE US. THEY WERE DOING THE SAME THING
THAT WE WERE DOING BUT DOESN'T THAT SHED LIGHT ON THE FACT THAT CONGRESS
BELIEVED THAT MEDICARE IN 1977 WAS PRIMARY. STANLEY G. WOJCULEWSKI:
I THINK YOU HAVE TO CONSIDER THE CONTEXT, THE HISTORICAL CONTEXT. THERE WERE
NO NO FAULT CLAUSE IN EXISTENCE IN 19 -- OOEL BUT THERE WERE AUTOMOBILE INSURANCE
CARRIERS. THEY WERE AWARE OF THAT. EVEN THOUGH THERE WAS NO FAULT THEY KNEW
THAT THERE WAS AUTOMOBILE INSURANCE IN 19 SKIEFZ. STANLEY G. WOJCULEWSKI:
THEN YOU'D HAVE TO GO THROUGH THE WHOLE ASPECT OF HAVING A THIRD PARTY CASE
AND COLLECTING FROM A TORTFEASOR BUT I WOULD ALSO POINT OUT THE FACT THAT THERE
WEREN'T AS MANY EMPLOYER BENEFIT PLANS. THE INSURANCE INDUSTRY EXPLODEED IN
THAT PERIOD. YOU HAD ALL THESE CLAIMS OUT THERE THAT COULD TAKE THE BURDEN OFF
OF MEDICARE AND CONGRESS SAID LET'S TAP INTO THOSE. IF THEY DIDN'T EXIST BACK
IN 1975 YOU CAN'T IMPUTE AN INTENT. CONGRESS SAID AT THAT THEY'RE TIMED,
WHEN ALL THESE OTHER FORMS OF INSURANCE COMES INTO EXISTENCE WE'RE GOING IT RELY
ON THEM TO TAKE THE BURDEN OFF OF MEDICARE. JUSTICE
PATTERSON: DO YOU HAVE ANY AUTHORITY FOR YOUR ARGUMENT THAT THE DEFINITION OF
PERSONS EXCLUDES INSURANCE COMPANIES UNDER FEDERAL LAW? THAT WOULD SEEM
TO ME TO BE AN ENORMOUS IF WE WERE TO RULE THAT WAY WE WOULD BE CHANGING THE LANDSCAPE
IN A VERY SIGNIFICANT WAY, CORRECT? STANLEY G. WOJCULEWSKI:
YEAH, AND I CANNOT SAY THAT PERSON DOESN'T MEAN THAT -- THAT HAS NOT BEEN
INTERPRETED UNDER MEDICARE LAW EITHER -- SORRY, TRADITIONAL LAW OR ELSEWHERE AS INCLUDING
INSURANCE COMPANIES. JUSTICE PATTERSON: JUST TO -- IF WE WERE
TOES THAT INTERPRETING FEDERAL LAW, WE WOULD BE OUT THERE BY OURSELVES SAYING
THAT, CORRECT? STANLEY G. WOJCULEWSKI: I MEAN -- YES, I WOULD
AGREE WITH THAT. JUSTICE PATTERSON: WHAT'S YOUR OTHER ARGUMENT
UNDER FEDERAL LAW. STANLEY G. WOJCULEWSKI: I THINK IT GOES TO
INTENT. WE'RE CLEARLY TALKING ABOUT THE BENEFICIARY OR THEIR PERSON. DOES
THAT OTHER PERSON INCLUDE AGAIN WHERE YOU HAVE A STATE THAT HAS DESIGNATED A PARTICULAR
FORM OF BENEFITS AS THE IMMEDIATE AND PRIMARY SOURCE OF RECOVERY, IT
CONGRESS INTENT TO INCLUDE IN THE WORK PERSON THAT RECOVERY, THAT PRIMARY
OBLIGATIONS UNDER PIP. AND I DON'T BELIEVE THERE'S ANY AUTHORITY THAT'S BEEN
SET FORTH BEFORE THIS COURT THAT WOULD SUPPORT THAT AND I WOULD THINK THAT WOULD BE
THE OBLIGATION OF THE RESPONDENT TO GIVE YOU THAT AUTHORITY.
JUSTICE PATTERSON: WHY ARE YOU COUCHING THAT IN A DEFINITION SECTION OF PERSON.
WHY IS THAT THE FRONT OF YOUR ARGUMENT, WHAT I THINK THAT YOU'RE REALLY
SAYING IS THERE ARE TWO POTENTIALLY CONFLICTING BODIES OF LAW HERE, ONE FEDERAL
AND ONE STATE AND WE'RE SUPPOSED TO LOOK AT THE -- TO TRY TO RECONCILE, TRY TO
SERVE CONGRESSIONAL INTENT AS WELL AS THE STATE LEGISLATURE.
STANLEY G. WOJCULEWSKI: AS THE JUSTICE POINTED OUT THIS IS NOT AN EASY CASE AND
IT IS A FACT PATTERN WHICH IS NOT COMMON. JUSTICE PATTERSON:
WHY. WOULD YOU POSSIBLY BE ASKING YOU CAN TO BE OUT THERE BY OURSELVES WITH
AN ENORMOUSLY CONSEQUENTIAL FOR MEDICARE LAW, IT SEEMS TO ME I HAVEN'T THOUGHT
THIS THROUGH BUT WOULD COVER ENORMOUS RAM MY FIDELITY CASES FOR THAT.
STANLEY G. WOJCULEWSKI: I WOULD BOIL IT DOWN TO IS IS THERE SOMETHING IN THE
FEDERAL LAW, THE MEDICARE LAW ITSELF THAT SPECIFICALLY SAYS THAT CONGRESS
INTENLDZED TO MEDICARE TO ACT PRIMARY OVERSTATE NO FAULT BENEFITS. THE ANSWER TO
THAT IS NO. SO -- JUSTICE PATTERSON: YOU'RE SAYING THERE'S
FEDERAL NEWS TRADITIONAL TEA. STANLEY G. WOJCULEWSKI: YES.
JUSTICE PATTERSON: IF THERE'S FEDERAL NEUTRALITY ON THE
UNDERLYING ISSUE AND WE HAVE STATE INTENT IN OUR LAW TO FIND OTHER SOURCES TO ALLEVIATE
THE BURDEN OF PREMIUMS IN NEW JERSEY ON DRIVERS, WHICH THE COLLATERAL SOURCE
PROVISION OF THE PIP LAW EVINCES WHAT'S YOUR ARGUMENT? STANLEY
G. WOJCULEWSKI: AGAIN, I DON'T THINK YOU CAN CONCLUDE THAT THE COLLATERAL SOURCE RULE
HAS THAT INTENT BEHIND IT. AGAIN, BECAUSE THAT WAS IN THE BEGINNING IN
1972. THEY DIDN'T KNOW WHAT PREMIUMS WERE GOING TO LOCK LIKE BACK THEN. THE WAY
I WOULD ALSO COUCH IT IS THE PIP STATUTE, 39:6A-FOUR, AGAIN IT'S NOT PERMISSIVE,
IT SAYS SHALL INCLUDE THESE BENEFITS, THESE BENEFITS SHALL BE PROVIDED AND CASE
LAW IS CONSISTENTLY HELD THAT THE LEGISLATURE HAS DECIDED THAT NO FAULT
BENEFIT IS GOING TO BE THE IMMEDIATE AND PRIMARY SOURCE OF RECOVERY. THAT'S THE
BODY OF LAW THAT I WOULD LIKE FOR YOU TO LOOK AT TO CONCLUDE IF FEDERAL
LAW IS NEUTRAL, STATE LAW HAS DESIGNATED THESE BENEFITS AS PRIMARY AND I DON'T
LIKE TO USE THAT TWORD AS THE JUSTICE POINT OUT, IS PRIMARY FOR RECOVERY OF
THIS TYPE OF HARM. THESE MEDICAL EXPENSES. JUSTICE PATTERSON: WHY
IS IT THAT FEDERAL LAW IS NEUTRAL IF, IN FACT, FEDERAL LAW REQUIRES COOPER TO
DO AND EVERY ERR HEALTHCARE PROVIDER THAT'S COVERED BY MEDICARE IS AGREE TO ONLY
CHARGE IN ACCORDANCE WITH THE MEDICARE STATUTE. BECAUSE YOU'RE SEEKING -- IT'S
OBVIOUSLY A LOT OF MONEY. STANLEY G. WOJCULEWSKI: AGAIN, IT'S
PROTECTING THE BSHL. THERE'S NO BALANCE BILLED TO THE BENEFICIARY OTHER THAN
WHAT'S BEEN SPECIFICALLY DESIGNATED AS THEIR DEDUCTIBLE AND COPAYMENT.
JUSTICE PATTERSON: BUT THERE'S MORE THAN TO THAT LANGUAGE. CONGRESS CERTAINLY
COULD HAVE SAID NO BALANCE BILLING TO THE BENEFICIARY AND WE DON'T CARE WHAT
YOU DO WITH ERNTS OTHER THAN THE BENEFICIARY. BUT THEY WENT BEYOND THAT THAT'S
WHY YOU'RE STILL REALLY LYING ON YOUR PERSON DEFINITION ARE YOU NOT.
STANLEY G. WOJCULEWSKI: THEY COULD HAVE SPECIFICALLY DESIGNATED OTHER SOURCES
OF INSURANCE OR. JUSTICE PATTERSON: THEY'RE USING THE PERSON
LANGUAGE, RIGHT? STANLEY G. WOJCULEWSKI: THEY ARE USING THE
PERSON LANGUAGE. JUSTICE PATTERSON: YOU REALLY DO NEED THAT
BROAD DEFINITION OR THAT RESTRICTION ON THE DEFINITION OF PERSON IN ORDER TO GET
TO NEUTRALIZE FEDERAL LAW. TWOEZ I'M NOT TRYING TO BE OBSTRUCT ACTIVE OR CONTRARY.
JUSTICE PATTERSON: YOUR ARGUMENT IS EXCELLENT.
STANLEY G. WOJCULEWSKI: I'M NOT TRYING TO BE CONTRARY BUT AGAIN I THINK THAT'S
WHY I KEEP GOING BACK TO INTENT. IF THERE'S GOING TO BE SOME AMBIGUITY TO
WHAT A PERSON MEANS. IS THERE ANY INTENT IN THE MEDICARE LAW TO DECEMBER SIT NIGHT
A PERSON, AN INSURANCE COMPANY UNDER STATE LAW TO PROVIDE THESE TYPE OF BENEFITS
WHICH ARE MEDICAL EXPENSES ARISING OUT OF MOTOR VEHICLE ACCIDENTS.
JUSTICE LA VECCHIA: THE DEFINITION IS IMPORTANT THOUGH UNDER THE SECONDARY PAY YOUR
ACT BECAUSE THAT ACT HAS BEEN USED BY THE UNITED STATES GOVERNMENT IT TRY
TO SECURE PAMTHS THROUGH EARLIER PRIOR SETTLEMENTS AND OTHER SETTINGS THAT IT NAY
OR MAY NOT REACH, WHICH IS WHY WE HAVE A LOT OF THE CASES THAT WE DO HAVE
TALKING ABOUT WHAT WAS IN EXISTENCE BEFORE AND WHAT WASN'T. BUT WE'RE STILL LEFT
WITH UNDER YOUR ARGUMENT AND AS FAR AS I CAN SEE, NO EARLIER STATEMENT IN
MEDICARE PRIOR TO THE SECONDARY PAYMENT ACT THAT COMPELLED MEDICARE TO BE PRIMARY
AS AGAINST ALL OTHERS. SO YOUR ARGUMENT IN RESPONSE TO THE QUESTIONING THAT
YOU'RE GETTING FROM THE COURT IS IN LOOKING AT THE FEDERAL STATUTE BUT I GATHER
YOUR STRONG GIFT INTENT ARGUMENT IS HOW THAT BACKGROUND WORKS AGAINST THE
INTENT OF THE COLLATERAL SOURCE RULE. STANLEY G. WOJCULEWSKI: YES
AND THE NO FAULT LAW. JUSTICE LA VECCHIA: AND THE NO FAULT
LAW GENERALLY. STANLEY G. WOJCULEWSKI: YES. AND AGAIN I
THINK THAT WE CAN'T IGNORE -- I CITED TO THIS IN MY INITIAL PRESENTATION,
THAT THERE IS SORT OF A BUILT IN WHICH YOU WOULD CALL A RESERVE CLAUSE OR SOMETHING
TO THAT EFFECT, 42 U.S.C. SECTION 1395. WHICH SAYS IT SPECIFICALLY REFERENCES
THAT STATES WE'RE NOT GOING TO FORECLOSE STATES FROM PROVIDING ADDITIONAL FORMS
EVER INSURANCE WHICH IS EXACTLY WHAT WE HAVE HIRE. THE STATE HAS SAID WE
NEED A FORM OF INSURANCE THAT ADDRESSES AUTOMOBILE ACCIDENT MEDICAL EXPENSES WITHOUT
RESORTING TO THE TRADITIONAL TORT SYSTEM AND THIS IS EXACTLY WHAT THE NEW
JERSEY STATE POLICE LEGISLATURE -- JUSTICE PATTERSON: THAT'S NOT WHERE
THEY STOPPED. THEY WENT ON TO ENACT A COLLATERAL SOURCE PROVISION. THAT'S
A PRETTY CLEAR STATEMENT WE WANT TO LIMIT THE IMPACT ON THE PIP.
STANLEY G. WOJCULEWSKI: IT'S IMPORTANT TO LOOK AT THE EXACTLY LANGUAGE IN THE
COLLATERAL SOURCE RULE IN THAT IT SAYS DID HE DID YOU DO FROM. IT IMPLIES
YOU CAN HAVE TWO SOURCES EVER PAYMENT. IF THERE'S AN OVERLAP ONE IS DID HE DUBTDZ
FROM THE OTHER. IF THEY CANCEL EACH OTHER OUT AS THE JUSTICE HAD INDICATED
EARLIER SURE THERE'S NO OBLIGATION. BUT IF YOU HAVE ONE THAT CAN PAY AND ANOTHER
THAT CAN PAY AND AS LONG AS THOSE BENEFITS DON'T OVERLAP BOTH CAN PAY. THAT'S
WHY THERE'S NO ACTUAL CONFLICT. JUSTICE ALBIN: THAT'S GREAT PROVIDED
YOU DON'T HAVE THE FEDERAL LAW THAT SAYS THAT YOU'RE BOUNDS BY YOUR CONTRACTUAL
COMMITMENT TO THE HOSPITAL. STANLEY G. WOJCULEWSKI: WHICH AGAIN
WE'VE BEEN DISCUSSING. CHIEF JUSTICE RABNER: OTHER QUESTIONS,
ANYONE? ANYTHING YOU'D LIKE TO ADD. STANLEY G. WOJCULEWSKI:
NO. THANK YOU. THANK YOU JUSTICES. CHIEF JUSTICE RABNER:
THANK YOU. MR. HILLE. ROBERT B. HILLE: MAY IT PLEASE THIS COURT,
I'VE GOT TO REMEMBER TO DO THAT. MAY IT PLEASE THIS COURT, CHIEF JUSTICE,
LEARNED COLLEAGUES, ON BEHALF OF THE NEW JERSEY HOSPITAL ASSOCIATION I'D JUST LIKE IT
FOCUS ON THE IMPACT, YOU HEARD THE LEGAL ARGUMENTS FROM COUNSEL ON THIS.
AND WE CERTAINLY HAVE SUBMITTED OUR BRIEFS AND OUR LEGAL ARGUMENTS AND I DON'T
MEAN TO REHASH THOSE BUT I DO WANT TO CALL THIS COURT'S ATTENTION TO THE
FACT THAT THE NEW JERSEY HOSPITAL ASSOCIATION REASONS THE HOSPITALS IN NEW
JERSEY. THEY HAVE A VERY STRONG MISSION HERE TO PROVIDE CARE TO THE CITIZENS
OF THE STATE AND EVEN PEOPLE WHO ARE UNWERE ELSE THAT ARE IN THIS STATE. THOSE
CARE DEMANDS CONTINUE TO INCREASE ESPECIALLY IN THE CURRENT PANDEMIC AND
AGAINST THAT DEMAND AND INCREASED CARE WE HAVE INCREASE AND SPIRALLING UPWARD COSTS
AND WE HAVE DECLINING REIMBURSEMENT. TODAY THIS DECISION BEFORE THIS COURT
THE IMPACT FROM IT, LEGAL ARGUMENTS, WE ALREADY DISCUSSED ASIDE, AMPLIFIES THAT
STRESS ON THE SYSTEM AND THE HOSPITALS IN THE SYSTEM THAT WE REPRESENT.
THE PREEMPTION ARGUMENT AND THEN THERE'S A BALANCED BILLING ISSUE IN THIS DECISION
THAT I JUST WANT TO COMMENT ON. IT'S A SPECIFIED CLASS I THINK THE INSURANCE
COUNCIL OF NEW JERSEY NOTED ABOUT 150 IN ITS THIS FOR THE PREEMPTION ISSUE, THE
PRETTY 1980 MEDICARE SECONDARY PAY YOUR ACT ISSUE. THAT IS NOT AN
INSIGNIFICANT NUMBER AND AS THE COURT CAN SEE BETWEEN THE COMPARISON OF THE NUMBERS
AND BETWEEN THE COST OF CARE PHYSICIAN OF 800 AND SOMETHING THOUSAND AND WHAT
MEDICARE IS ULTIMATELY PAYING HERE OF 80 SOMETHING THOUSAND AND THE REST
NOW BEING REFUNDED OR EXCUSED IN TERMS OF THE PIP CARRIER, THAT IS NOT GOING TO GO
AGAINST THE INDIVIDUAL, OKAY THAT INDIVIDUAL IS NOT GOING TO BE
RESPONSIBLE. BUT WHAT IT DOES DO IS IT BASICALLY DOES CREATE WHETHER JUSTIFY ABOUT
OR NOT A WINDFALL FOR PIP CARRIERS IN THIS CONTEXT. AND BY THE WAY THE
CLASS IS THE MOST SERIOUSLY INJURED PEOPLE. WE DON'T HAVE AT THIS POINT PEOPLE
WHO HAD MINOR SOFT TISSUE INJURIES IN THAT CLASS. THESE ARE PEOPLE WHO ARE
GOING TO NEED HELD CARE FOR THE REST OF THEIR LIVES AS THIS INDIVIDUAL DOES. SO
IT'S A WIND FILL FALL FOR THE PIP CARRIERS IN THIS CASE. PROGRAMS JUSTIFIABLY
BUT IT'S A WINDFALL FOR THESE SEVERELY INJURED PEOPLE AND ALSO GETS THEM
AWAY FROM AN OBLIGATION OF HAVING TO PROVIDE COVERAGE THAT WAS BOUGHT AND PAID
FOR BY THESE VERY SERIOUSLY INJURED PEOPLE. IT ALSO BURDENS MEDICARE AND
WE TALKED ABOUT THE TUG OF WAR BETWEEN THE STATE AND THE FEDERAL GOVERNMENT STATUTORY
SCHEMES AND I'LL MAKE REFERENCE TO THAT IN A MOMENT. WHETHER OR NOT IT
JUSTIFIABLY DOES SO IT DOES BURDEN MEDICARE AND I THINK THAT'S AN IMPORTANT IMPORTANT
WHEN YOU LOOK AT WHAT THE INTENT WAS OF CONGRESS AND WHAT THE WHOLE DESIGN
OF MEDICARE WAS BEFORE 1980 AND WHETHER 1980 WAS REALLY A POLICY SHIFT, WHICH I DON'T
THINK THE RECORD BEFORE THIS COURT SUPPORTS OR WHETHER IT WAS A CLARIFICATION
OF MEDICARE'S DESIGN TO MAKE SURE THAT PEOPLE THAT CAME IN AHEAD OF MEDICARE COULD
COME IN AHEAD OF MEDICARE AND THAT MEDICARE WOULD BE SECONDARY. THERE
WAS NO QUESTION ABOUT THAT AFTER 1980. JUSTICE PATTERSON: MAY I ASK YOU,
WHY DOES IT PUSHED MEDICARE? I MEAN OBVIOUSLY MEDICARE HAS PAID IN
ACCORDANCE WITH THE SCHEDULE HERE BUT THE REAL ISSUE IN THIS CASE IS THE MONEY THAT
IS OVER THE MEDICARE PAYMENT AMOUNT AND UP TO THAT 800 PLUS THOUSAND AMOUNT.
ROBERT B. HILLE: I THINK FROM THE ADVENT OF NEW JERSEY'S PIP
STATUTE WAS WAS BY THE WAY WAS ENABLED TO MAKE SURE BADLY INJURED PEOPLE GOT THE
CARE GOT PAID FOR QUICKLY. YOU DIDN'T HAVE TO HAVE PEOPLE TRYING TO AVOID
HAVING TO CHASE COVERAGE WHICH IS WHAT THIS OPINION IS IS ULTIMATELY GOING TO RESULT
IN. BUT WHAT YOU EVER THERE IS YOU HAVE A STATUTORY SCHEME WHICH THEN PLACES
THE OBLIGATION ON THE INDIVIDUAL PIP CARRIERS FOR THESE PEOPLE WHO BOUGHT THAT
COVERAGE, BY THE WAY, INSURANCE WITH NEW JERSEY LAW AT THE TIME, UNLIMITED
COVERAGE. AS A CONSEQUENCE OF THAT THOSE CARRIERS WERE JUMPING FIRST AS THEY WERE
SUPPOSED TO DO UNDER THE LAW AND, IN FACT, SELECTIVE DID THAT HERE INITIALLY
BACK IN '78 OR '77 WHENEVER THIS HAPPENED. AND THEN AS A CONSEQUENCE OF THAT MEDICARE
IN THAT SITUATION, ONCE THIS PERSON BECAME ELIGIBLE, DOESN'T HAVE TO SAY,
OH, YOU KNOW WHAT, RETROACTIVELY WE'RE GOING TO HAVE TO PAY FOR THAT UNLESS THERE
WAS AN INTENT OBVIOUSLY IN THE MEDICARE LAW TO DO THAT. BUT THE FACT IS
WHETHER IT'S JUSTIFIABLY LABEL OR NOT IS THAT THIS SITUATION AS AN EXAMPLE, IF PIP
COVERED EVERYTHING MEDICARE WOULDN'T HAVE TO PAY. MULTIPLY THAT BY 150 PEOPLE.
JUSTICE PATTERSON: TELL ME IF I'M WRONG I THOUGHT THE 85,000
DOLLARS IS NOT AN ISSUE IN THIS CASE. ROBERT B. HILLE: I
MAY HAVE THE NUMBERS TWROPG. BUT WHATEVER THE MEDICARE NUMBER WAS SUBSTANTIALLY
LESS FROM WHAT THE PIP PAYMENTS WERE FOR THIS INDIVIDUAL. YOU LOOK AT THAT AND
YOU MULTIPLY THAT BY 150 IN THE CLASS THAT'S MILLIONS OF DOLLARS TO THESE
HOSPITALS. JUSTICE ALBIN: THE STATUTE SAYS, OUR STATUTE SAYS
THAT IF A PERSON IS ON MEDICARE THE COLLATERAL SOURCE DOCTRINE YOU GOT TO
DEDUCTED IT FROM MEDICARE, THE PIP, CORRECT THAT'S WHAT YOU GOT TO DO?
ROBERT B. HILLE: WELL, 6A-SIX WHERE IT SAYS -- JUSTICE ALBIN:
BENEFITS COLLECTIBLE UNDER WORKERS' COMPENSATION MEDICARE PROVIDED UNDER FEDERAL
LAW. ROBERT B. HILLE: I THINK YOU HAVE -- THE WAY
WE'RE READING IT AND MY HOSPITAL IS READING IT, IS THAT WHERE -- AND MAYBE
UNREASONABLY BUT THAT'S THE WAY THEY'RE READING IT. AGAIN THERE ARE ROOEGSZ OAE
REGULATIONS, I THINK WE REFERENCED THAT IN OUR EARLIER BRIEFS IN THIS CASE.
BUT MEDICARE PROVIDED UNDER FEDERAL LAW. THAT DOESN'T SAY MEDICARE'S PRIMARY UNDER
FEDERAL LAW. IT SAYS ANY BENEFITS THAT MEDICARE PROVIDES SHALL BE DEDUCTED
FROM THE BENEFITS COLLECTED. SO THAT'S A SAVING CLAUSE TO PREVENT DOUBLE RECOVERY.
THAT'S NOT PLACING THE WAY THAT -- AT LEAST THERE'S AN ARGUMENT THERE THAT
THE LANGUAGE THERE IS NOT PLACING MEDICARE AS A PRIMARY. IN FACT, PRIMARY IS NOT
USED ANYWHERE THERE. JUSTICE ALBIN: IT SAYS SHALL BE DEDUCTED
FROM. ROBERT B. HILLE: WHERE IT PAYS. AGAIN, JUSTICE
MAYBE YOU'RE LOOKING AMOUNT THIS THE WRONG WAY. THE HOSPITALS THAT ARE BILLING
AND APPROACHING THIS BILLING YOU'RE LOOKING AT THAT AND THEY'RE SAYING THAT
WHERE MEDICARE IS PAYING OR WHERE MEDICARE IS SUPPOSED TO PAY PROVIDED BY FEDERAL
LAW, THEN THOSE PAYMENTS WILL BE DEDUCTED FROM ANYTHING WE GO AFTER PIP FOR.
JUSTICE ALBIN: I UNDERSTAND THAT EXCEPT THAT'S WHERE WE GET
THE FEDERAL LAW. ROBERT B. HILLE: RIGHT. JUSTICE
ALBIN: SO IF THEY WERE PAYING EVERYTHING OR A PART -- IF THERE WASN'T A LAW SAYING
THAT YOU CAN'T CHARGE THE PATIENT ANYTHING MORE OR SOME OTHER PERSON.
ROBERT B. HILLE: RIGHT. JUSTICE ALBIN: THEN
WE WOULDN'T HAVE A PROBABLE. BUT WE HAVE THAT PROBLEM BECAUSE THAT'S FEDERAL
LAW AND THAT'S WHERE THIS CONCEPT OF PREEMPTION COMES INTO PLACE. ONCE YOU START
ACCEPTING THOSE MEDICARE PAYMENTS FROM THE FEDERAL GOVERNMENT THEN YOU'RE
BOUNDS BY THE REGULATIONS OF THE STATUTE NOT TO CHARGE ANYTHING MORE THAN UNDER
THE SCHEDULE, CORRECT? ROBERT B. HILLE: I'M NOT SURE THAT I WOULD
COMPLETELY AGREE WITH THAT. I THINK THAT FIRST OF ALL MEDICARE, IT'S A
PARTICIPATORY AND IT'S A CONTRIBUTORY PROGRAM. THE FOCUS IS ON THE CARE FOR THE
RETIRED ELDERLY AND THE DISABLED. IT'S NOT AN INSURANCE SHIFTING SCHEME
AT LEAST THAT'S NOT PRESENT IN THE FEDERAL LANGUAGE AND I HAVEN'T SEEN ANYONE E
ANYWHERE WHERE IT'S BEEN CONSTRUED THAT WAY ON A AT ANY TIME LEVEL, THIS
OPINION ACCEPTED. BUT WITH RESPECT TO MEDICARE PRE 1980 THE WAY THE HOSPITALS
WERE BILLING ON THIS IS THEY LOOKED AT THE NEW JERSEY PIP LAW. THEY LOOKED
AT THE MEDICARE LAW. THE INDIVIDUAL PATIENT WAS THE ONE THAT REALLY DICTATED WHERE
THE PAYMENTS SHOULD GO. IN THIS CASE THIS INDIVIDUAL I THINK WAS PAYING, YOU
KNOW, EARLY ON WAS ALL GOING TO PIP THEY ELECTED THAT. THAT WAS THE PATIENT'S RIGHT.
JUSTICE PATTERSON: SO I'M NOT ASKING YOU TO TELL US WHY COOPER
PAID THIS BUT -- BUT WHY -- AND YOU'RE NOT SPEAKING FOR MEDICARE -- BUT IT SEEMS
THAT THERE WAS A DETERMINATION MADE BY SOMEBODY THAT MEDICARE SHOULD PAY
COOPER WITHIN THE SCOPE OF ITS SCHEDULE. ROBERT B. HILLE:
I MEAN THERE WAS. JUSTICE PATTERSON: THAT PROBABLY ROUTINE
HAPPENS IN THESE SITUATIONS. ROBERT B. HILLE: I THINK THAT WAS --
I CAN'T SPEAK FOR COOPER BECAUSE COOPER MADE A DECISION THAT. BUT WHAT I'M
TALKING THERE. JUSTICE PATTERSON: MEDICARE MADE A DECISION.
JUSTICE LA VECCHIA: LET'S BE CLEAR ON THIS POINT I THOUGHT
IT WAS BECAUSE SELECTIVE DECLINED THE BILL. ROBERT B. HILLE:
ORIGINALLY, YES. JUSTICE LA VECCHIA: AND THEN THE HOSPITAL
COMPLIED. ROBERT B. HILLE: YES. AND AGAIN, I SAID I HAVE
NOTHING TO DO WITH THAT BUT MY UNDERSTANDING IS BASED ON THE RECORD HERE BEFORE THIS
COURT ON THIS DECISION IS THAT THAT HAPPENED. BECAUSE ALL OF A SUDDEN
SELECTIVE HAD AN E PERSIST FAR KNEE -- JUSTICE LA VECCHIA: WHAT IS
THE MECHANISM THAT YOU A LOADS SELECTIVE TO IGNORE A JUDICIAL ORDER THAT
WOULD REQUIRE IT TO CONTINUE TO MAKE PIM PAYMENTS. ROBERT B.
HILLE: MY UNDERSTANDING OF THE RULES IS YOU'RE REQUIRED TO GO TO COURT TO ASK FOR
RELIEF FROM A JUDGMENT OR AN ORDER IN THIS CASE FOR SOME REASON IT GOT INTO
COURT AND THE SUBSEQUENT ORDER WAS ISSUED. SO I WOULD SUBMIT THAT THE USUAL PROFILE
FOREGOING BACK TO GETS RELIEF FROM THE ORDER WAS NOT PRESENT IN THIS RECORD
HERE. AS TO MOTIVATION, AGAIN, JUSTICE, I WASN'T INVOLVED ON THAT LEVEL SO CANDIDLY
I CAN'T SPEAK TO THE REASONS AND HOW WE GOT HERE PROCEDURALLY.
JUSTICE FABIANA PIERRE-LOUIS: JUST TO BE CLEAR AFTER SELECTIVE DECLINED COVERAGE
AND COOPER WENT TO MEDICARE THAT 84,000 DOLLARS THAT MEDICARE PAID COOPER
DID RETURN IT AFTER COOPER REALIZED THAT -- THAT IT WAS THEIR UNDERSTANDING UNDER
THAT COURT ORDER THAT SELECTIVE WAS TO BE THE PRIMARY PAYER. THAT MONEY WAS
RETURNED. ROBERT B. HILLE: IN FACT, MEDICARE HAS A PROVISION
TO ADDRESS THAT SITUATION WHICH PRESUMABLY THIS IS ONE THEY WOULDN'T HAVE.
THE COURT: YOU CAME TO ARGUE ASK THE IMPACT OF THIS ON THE HOSPITALS.
ROBERT B. HILLE: THANK YOU, CHIEF. CHIEF JUSTICE
RABNER: WE'VE TAKEN YOU A LITTLE BIT FAR AFIELD AND WE'RE BY THE BEYOND YOUR
TIME. ANYTHING YOU'D LIKE IT ADD ON THAT POINT. ROBERT B. HILLE:
THE ONLY THING I WOULD LIKE TO CALL THIS COURT'S ATTENTION TO AND WHEN I SAID
THE BURDEN ON MEDICARE BEFORE WE WENT OFF ON THESE ISSUES, BUT THE BURDEN
ON MEDICARE WAS THE FACT IS THAT WHETHER IT'S A JUSTIFY ABOUT BURDEN OR NOT THE
DECISION BELOW PLACES CATEGORICALLY IN THIS CASE THAT MEDICARE IS RESPONSIBLE
FOR ALL THESE MEDICARE ELIGIBLE BENEFICIARIES. AND P FINALLY THE MOST
IMPORTANT IMPACT ON THAT POINT AND I JUST WANT TO MENTION SOMETHING BRIEFLY
ON THE BALANCED BILLING ISSUE TO CALL THE COURT'S INTENTION TO SOMETHING IN THE
OPINION THAT I THINK REQUIRES CLARIFICATION BUT WITH RESPECT TO THE
FINAL POINT ON THAT IT CLEARLY CAUSED SHIFTS TO THE HOSPITAL BECAUSE THE OUTCOME
OF THIS DECISION BELOW IF IT'S AFFIRMED HERE, IS GOING TO BE THAT COOPER AND
EVERY OTHER HOSPITAL TREATING THE SEVERELY ILL PATIENTS IN THIS CLASS, ARE GOING
TO BE FACED WITH BEARING THE COST OF THAT CARE AND EVERYTHING ELSE THEY'RE TRYING
FOR OUR SOCIETY IN THIS STATE AND IN THAT CIRCUMSTANCE THEY'RE NOT GOING
TO BE ABLE TO PURSUE ANYTHING ELSE BEYOND MEDICARE. I THINK THAT I WOULD SUBMIT
THAT'S A DISTORTION OF THE INTERPLAY BETWEEN THE TWO LAWS. THERE IS
NOTHING MEDICARE COULD HAVE EASILY SAID THIS IS GOING TO BE IT. BEFORE 1980 AND
NO OTHER INSURANCE IN THIS CASE IS GOING TO BE, YOU KNOW, RELEVANT WHERE YOU
CAN LOOK TO. THEY ALSO HAD THE ABILITY TO PUT THAT IN THE STATUTE AND THEY DIDN'T.
JUSTICE PATTERSON: LET ME ASK YOU, WHAT THE HOSPITAL
ASSOCIATION'S POSITION IF THERE IS ONE AS TO WHETHER THE BALANCE BILLING STATUTE
BECAUSE OF THE DEFINITION OF PERSONS EXCLUDES INSURANCE COMPANIES.
ROBERT B. HILLE: THAT'S MY POINTS I WANTED TO GET INTO. JUSTICE
PATTERSON: JUST A REAL SIMPLE QUESTION. IS IT YOUR POSITION THAT AN INSURANCE
COMPANY IS EXEMPT FROM THE LANGUAGE IN THE BALANCED BILLING STATUTE THAT
SAYS THE BENEFICIARY OR OTHER PERSONS, I'M SEVEN SIMPLIFYING THE LANGUAGE.
ROBERT B. HILLE: . NO THIS DEBTS BACK TO MY POSITION BEFORE THAT IT'S BENEFICIARY
OR P YENTD AND NOT INSURANCE LEGISLATION. JUSTICE PATTERSON:
UNDERSTOOD. BUT WAS IT CONGRESS'S INTENT TO INCLUDE INSURANCE COMPANIES IN THE
DEFINITION OF PERSON? ROBERT B. HILLE: I'M NOT SURE IT WAS
CONGRESS'S INTENT NOT TO INCLUDE THEM IN. I THINK THAT CONGRESS EVERY REALLY
ADDRESSED. JUSTICE PATTERSON: I THINK YOUR COLLEAGUE HAS CONCEDED
THERE'S NO LAW ANYWHERE AND I SEE THIS AS A POINT WITH MAJOR RAMIFICATIONS FOR
-- FOR OTHER CASES IN NEW JERSEY AT LEAST IF WE WERE TO SAY THAT CONGRESS
INTENDED TO EXCLUDE INSURANCE COMPANIES FROM THAT BALANCED BILLING OR FROM THAT
BALANCED BILLING STATUTE. ROBERT B. HILLE: MEDICARE HASN'T SPOKEN
ON THIS. WE DON'T KNOW WHAT MEDICARE IS GOING TO DO, I WAS GOING TO MENTION
ON THAT BALANCED BILLING ISSUE, THAT SINCE 1980, 40 YEARS OF IMPACT WHERE MEDICARE
IS SECONDARY AND THAT IS THIS PRIMARY TUG OF WAR, BACK TO CHASING COVERAGE
AGAIN. THERE'S AN ISSUE OF CAPS THAT HAVE TO BE SFWOECHD BECAUSE OF THE APPELLATE
DIVISION'S EXTENSION OF THAT. BUT GETTING BACK TO WHAT IT WAS BEFORE, I FRANKLY
DON'T HAVE AN ANSWER AND I HAVEN'T RESEARCHED THAT ISSUE FOR THIS COURT AS TO
WHAT THE TERMINOLOGY OF PERSON MEANT. I CAN SPEAK TO THIS COURT THAT WHEN
YOU LOOK AT THE MEDICARE LEGISLATION THE FOCUS WAS NOT TO BAIL OUT INSURANCE
COMPANIES. THE FOCUS OF IT WAS IT PROVIDE CARE TO THE PUBLIC, PEOPLE WHO WORKED
AND RETIRED, TO MAKE SURE THAT THEY HAD SOME CARE AND TREATMENT AND, YES, BECAUSE
OF THE CONFINES AND THE PRESSURES ON COST OF THAT CARE, JUST LIKE WITH THE
HOSPITALS NOW, THE FEDERAL GOVERNMENT AND THE STATE GOVERNMENT ARE LOOKING TO LIMIT
WAYS THAT THEY CAN BE EXPOSED. UNFORTUNATELY WE CAN'T OTHER THAN TO GO OUT
OF BUSINESS AND NOT TREAT PEOPLE. JUSTICE PATTERSON: WHAT IS
YOUR POSITION IF YOU HAVE ONE ON YOUR BEHALF OF YOUR CLIENT WITH RESPECT
TO WHETHER A WORKER'S COMP. LAW IS WRONG? ROBERT B. HILLE: I HAVEN'T
TAKEN THE POSITION IN OUR PAPERS THAT IT IS. YOU KNOW, OUR POSITION REALLY
IS IN SUPPORT OF THE PREEMPTION ARGUMENT THAT WE THINK YOU CAN HARMONIZE THE TWO
STATUTES BECAUSE A THERE'S NO EXPRESSED PROHIBITION, B WE HAVE COMP.
RECOGNIZED IN THE MEDICARE LAW BEFORE PIP WAS EVEN, YOU KNOW, ON THE HORIZON SO
IT RECOGNIZES THAT IT'S NOT A FIELD PREEMPTION ISSUE. AND THE CONFLICT
PREEMPTION ISSUE HERE WHERE MEDICARE CHANGED THE LAW IN 1980 TO PUT THE SECONDARY
PAY YOUR ACT, THAT ALSO INDICATES THAT IF THIS COURT WERE TO DECIDE THAT
ELECTRIC ACTIVE BEARS THE EXPENSE IN THIS CASE IN TREATING THIS PATIENT IN THIS
CLASS OF PEOPLE, THAT IN THAT SITUATION THERE IS NO CONFLICT BECAUSE MEDICARE IS
GETTING THE BENEFIT OF EXACTLY WHAT THE DESIGN WAS BY NOT WRITING THAT BENEFIT
OUT OF THE LAW WHEN IT WAS FIRST END ACTED IN THE 60S AND NOW IN '80, MAKING CLEAR
AND I WOULD SUBMIT IT'S A CLARIFICATION, NOT A CHANGE OF POLICY TO SAVE
DIMES, DOLLARS, WHATEVER. BUT TO MAKE SURE THAT MEDICARE COULD BE SECONDARY AND
NOT PRIMARY AND THAT IT WASN'T THE INTENT OF CONGRESS TO DO THAT. IN FACT,
BY THE WAY, THERE IS NO STATEMENT IN 1980 THAT TALKS ABOUT CHANGING THE LAW. SO, YOU
KNOW, WITH RESPECT TO THAT ISSUE -- I JUST WANT TO MENTION BRIEFLY THIS BALANCED
BILLING ARGUMENT. CHIEF JUSTICE RABNER: PLEASE DO THAT AND
TRY TO WRAP UP YOUR ARGUMENT. ROBERT B. HILLE: I APOLOGIZE.
CHIEF JUSTICE RABNER: NO APOLOGY NEEDED. ROBERT B. HILLE:
THE ONLY THING I WISH TO CALL THE COURT'S ATTENTION TO IT STARTS ON PAGE 13 IN
THE SLIP OPINION BUT REALLY IT'S A SECOND SENTENCE BEGINS ON PAGE 17 OF THE
SLIP OPINION WHERE IT TALKS ABOUT EVEN WHERE MEDICARE IS NOT THE PRIMARY PAYER.
AND IT GOES ON TO SUGGEST AND OUR CONCERN IS IS THAT THAT SUBJECTS THAT
THE CARRIER -- THE HOSPITALS ARE LIMITED TO WHATEVER THE MEDICARE ALLOWABLE AMOUNT
IS. BUT HOW DO YOU EVEN GET THERE WITHOUT HAVING TO PROVIDE TO MEDICARE
AND MEDICARE IS SECONDARY THAT'S AN INCONSISTENCY. AND YOU KNOW, IN OTHER WORDS
NOW AFTER 40 YEARS OF MEDICARE TREATING SITUATIONS AND ADDRESSING SITUATIONS
WHERE THE HOSPITALS COULD TAKE THOSE FEES FOR THE PATIENTS WHERE MEDICARE WAS SECONDARY
AND NOT VIOLATE THEIR CONTRACTS WITH MEDICARE AND, BY THE WAY, THOSE
CONTRACTS HAVE RATE ADJUSTMENT ISSUES WITH COMMERCIAL PLAYERS, THIS UP ENDS EVERYTHING
IN THAT REGARD IF THE LANGUAGE THERE IS INTENDED TO SUGGEST THAT WE CAN'T
GO A PRIMARY SOURCE FIRST. AND THEN ADDRESS UNDER THE MEDICARE LAWS MEDICARE AS
A SECONDARY. JUSTICE LA VECCHIA: DO YOU SEE THE APPELLATE
DIVISION DECISION AS AFFECTING A CHANGE FOR HOSPITALS. ROBERT B.
HILLE: ABSOLUTELY. THAT IS A VERY BIG PROBLEM FOR OUR PEOPLE. BECAUSE THAT'S
THE WAY WE'RE LOOKING AT IT. WE HAVE TO BE CAREFUL BECAUSE WE CAN'T AFFORD
TO SPEND MILLIONS OF DOLLARS HERE AND BE WRONG. SO WE GOT IT PLAY IT SAFE TO BEGIN
WITH WHICH MEANS WE COULD WIND UP BEING OUT OF MILLIONS OF DOLLARS THAT
WE MIGHT OTHERWISE BE ENTITLED TO. SO AGAIN THAT'S AN ISSUE WITH RESPECT TO
CONSTRUCTION AND, YOU KNOW, WHAT IS MEANT THERE AND CLARIFICATION. SO FOR THOSE
REASONS AND THANK YOU FOR YOUR PATIENCE THIS COURT YOU KNOW WE WOULD SUBMIT THAT
YOUR DECISION SHOULD BE REVERSED. CHIEF JUSTICE RABNER: THANK YOU.
MS. BRADY: THANK YOU, YOUR HONORS, MAY IT PLEASE THE COURT,
I JUST WANT TO BEGIN BY ADDRESSING A COUPLE OF ISSUES THAT AROSE DURING THE PRIOR
COLLOQUIES. THE FIRST IS WITH RESPECT TO COOPER'S SUGGESTION THAT SOMEHOW
THE WORD PERSON WITHIN THE MEDICARE LIMITING CHARGE STATUTE DOESN'T EXTEND TO A
N INSURANCE COMPANY, THE PRINCIPAL THING I WANT TO SAY ABOUT THAT ARGUMENT IS
THAT COOPER HAS NEVER MADE THAT ARGUMENT IN THIS CASE PREVIOUSLY, SO THAT ARGUMENT
IS WAIVED. AND REGARDLESS, THEY CITE THE COURT TO NO AUTHORITY TO SUGGEST THAT
SOMEHOW PERSONS WOULD NOT ENCOMPASS A JURIDICAL PERSON, INCLUDING A
CORPORATION THAT IS AN INSURANCE COMPANY. THE SECOND POINT I'D LIKE
TO ADDRESS IS ONE RAISED BY COUNSEL FOR THE HOSPITAL ASSOCIATION, AND THAT IS
THE SUGGESTION THAT THE PAYMENT OUTCOME IN THIS CASE APPROVED BY THE APPELLATE
DIVISION IS SOMEHOW A WINDFALL TO SELECTIVE AS THE PIP CARRIER GENERATING A PERSPECTIVE
FUTURE WIND FALLS FOR FUTURE CARRIERS FACING THESE SCENARIOS. THERE IS
NO WINDFALL TO THE PIP CARRIERS WHO WROTE POLICIES APPLYING TO MOTOR VEHICLE ACCIDENTS
THAT HAPPENED PRIOR TO THE ENACTMENT OF THE MEDICARE SECONDARY PAYER ACT,
THE REASON BEING THOSE POLICIES WERE ISSUED AND PARTICULARLY IN THIS CASE IN 1977
AT A TIME WHEN BOTH NEW JERSEY LAW AND FEDERAL LAW IN THE FORM OF THE
MEDICARE ACT PROVIDED FOR MEDICARE TO PAY AS PRIMARY. STATE LAW EFFECTED THAT PRIMACY
AS JUSTICE ALBIN HAS POINTED OUT BY VIRTUE OF THE COLLATERAL SOURCE STATUTE
WHICH EFFECTS A BURDEN SHIFTING FROM PIP TO THE OTHER SOURCES WITHIN THE STATUTE
DESIGNATED AS THE COLLATERAL SOURCES, BEING PRINCIPALLY WORKER'S COMP AND
MEDICARE PROVIDED BY FEDERAL LAW. IT IS BEYOND DISCUSSION AT THIS POINT THAT THAT
COLLATERAL SOURCE STATUTE EFFECTS A PRY MAEGS DESIGNATION, ALBEIT NOT USING
THE WORD PRIMACY, FOR THOSE COLLATERAL SOURCES, AND THAT PRIMACY HAS BEEN RECOGNIZED
OVER AND OVER BY THE COURTS OF THIS STATE, BY THE APPELLATE DIVISION AS EARLY
AS THE LEFKIN DECISION AND THE MORE RECENT DECISIONS OF TALMADGE, I LOST THE MORE
RECENT DECISION. JUSTICE PATTERSON: AND CHEZ.
MS. BRADY: AND CHEZ IS THE MOST RS ONE THAT BEING OF COURSE AN OPINION OF THIS
COURT WHERE ALTHOUGH THE COURT WAS DIVIDED ON A CERTAIN POINTS THE COURT WAS NOT
DIVIDED AND IN FACT WAS UNIFORM IN EXPRESSLY RECOGNIZING IN BOTH THE CONCURRENT
AND THE DISSENTING OPINION THAT THE EFFECT OF THE COLLATERAL SOURCE STATUTE IS
TO RENDER THE DESIGNATED SOURCES AS PRIMARY. JUSTICE LAVECCHIA:
DOES IT MATTER THAT WK WORKMAN'S COMP IS GEARED TO A STATUTE THAT IS TO PROVIDE
IMMEDIATE HELP TO WORKERS, OR THERE'S A READY WAY TO RESOLVE LIABILITY
QUESTIONS AS OPPOSED TO OTHER FORMS OF REIMBURSEMENT THAT THE COLLATERAL SOURCE
RULE SEEMS TO ADDRESS THROUGH ITS EFFORTS TO PREVENT DOUBLE BILLING OR --
BUT STILL MAKE SURE THAT COVERAGE IS PROVIDED TO THE INDIVIDUAL WHO IS INJURED?
MS. BRADY: WELL, BEGINNING WITH THE WORKMAN'S COMP POINT
FIRST, THERE IS A MECHANISM THAT DICTATES THAT WORKER'S COMP WOULD PAY A PARTICULAR
SCENARIO, WHERE YOU HAVE A MOTOR VEHICLE ACCIDENT, THERE HAVE BEEN A NUMBER
OF SITUATIONS WHERE WORKER'S COMP WAS NOT READILY AVAILABLE EITHER BECAUSE THE
INJURED PERSON HADN'T APPLIED FOR WORKER'S COMP BENEFITS OR WORKER'S COMP
HAD DECLINED TO PAY CERTAIN BENEFITS, AND IN THAT SCENARIO, THE APPELLATE DIVISION
AND THIS COURT HAS EXPRESSLY RECOGNIZED THAT THERE IS THE ABILITY OF THE PIP
CARRIER TO CLAIM OVER AGAINST THE WORKER'S COMP CARRIER IN ORDER TO AFFECT THE
PRIMACY DESIGNATION. JUSTICE LAVECCHIA: IN EARLIER CASES, I KNOW
THESE MORE RECENT ONES WE'RE TALKING ABOUT PRIMACY WHO DO YOU TURN TO FIRST
BUT THERE WERE CERTAINLY EARLIER APPELLATE DIVISION DECISIONS, JUDGE PRESSLER'S
OPINION TALKS ABOUT IT, WHERE PIP PAYS FIRST AND THEN TRIES TO SECURE MONEY
FROM OTHER ENTITIES THAT SHOULD BE RESPONSIBLE UNDER THE COLLATERAL SOURCE RULE,
INCLUDING WORKER'S COMP. SO SOMEHOW THE CLAI HAS EVOLVED TO WHO YOU SHOULD
TURN TO FIRST AS IF IT'S AN IRONCLAD ASSERTION UNDER THE COLLATERAL SOURCE RULE.
IS THAT YOUR POSITION? MS. BRADY: SO I DO THINK THAT THE
CORE QUESTION HERE BECOMES A WHO PAYS FIRST QUESTION. JUSTICE
LAVECCHIA: IT DOES BECAUSE OF THE BILLING RATES, BUT WHAT I'D LIKE TO DO IS HAVE
A CONVERSATION WITH COUNSEL THAT'S NOT FOCUSSED ON THE OUTCOME OF THE BILLING
RATE AND IS FOCUSSED MORE ON THE LEGISLATIVE INTENT OF THE COLLATERAL SOURCE
RULE, WHICH SEEMS, I'M JUST GOING TO SAY IT, IN MY VIEW, SEEMS INTENT ON
AVOIDING DOUBLE BILLING. MS. BRADY: I THINK IT ACHIEVES THAT
PURPOSE, BUT ADDITIONALLY, AND I BELIEVE THIS IS REFLECTED IN THE AND CHEZ OPINION
AND AS JUSTICE ALBIN POINTED OUT THE OTHER PURPOSE TO BE AFFECTED IS TO MINIMIZE
THE ECONOMIC BURDEN PLACED UPON THE NEW JERSEY AUTO INSURANCE BUSINESS, AND INSURE
THAT WHERE THERE IS ANOTHER AVAILABLE SOURCE AS DESIGNATED BY THE
LEGISLATURE, THAT THE BURDEN OR THE RESPONSIBILITY FOR THE PARTICULAR INJURIES IN
QUESTION FALL TO THAT OTHER SOURCE. IN THE WORKER'S COMP SCENARIO, AS I MENTIONED
PREVIOUSLY, THERE WERE SCENARIOS WHERE WORKER'S COMP HAD NOT STEPPED UP
IMMEDIATELY OR DECLINED PAYMENT, AND THE COURTS IN VARIOUS DECISIONS RECOGNIZED
IN THAT SCENARIO THE ABILITY OF THE PIP CARRIER WHO HAD PAID FIRST TO THEN
COLLECT BACK FROM THE WORKER'S COMP CARRIER, AND THAT'S AN APPROVED STRUCTURE.
JUSTICE LAVECCHIA: RIGHT. MS. BRADY: AND WE
RECOGNIZE THAT. THE QUESTION HERE THOUGH BECOMES DOES A PAY FIRST SCENARIO
WHICH IS WHAT COOPER ADVOCATES IMPLEMENT THAT BURDEN SHARING TO BE ACHIEVED BY T
HE CLOT ORIGINAL SOURCE STATUTE, AND IT CANNOT AND THE REASON IT CANNOT IS
BECAUSE IT RUNS HEAD LONG INTO A CONFLICT WITH FEDERAL LAW.
JUSTICE LAVECCHIA: THIS WHOLE CONFLICT REALLY COMES DOWN TO SHIFTING THE DISCUSSION
TO WHO PAYS FIRST, BECAUSE LOVER PAYS FIRST, DICTATES THE AMOUNT OF THE
REIMBURSEMENT FOR THE SAME CARE THAT'S ALREADY BEEN PROVIDED TO THE INJURED
INDIVIDUAL. THAT'S THE REAL ELEPHANT IN THIS ROOM. THIS ARGUMENT IS ALL ABOUT
BILLING RATES, AND PIP OBVIOUSLY WOULD LIKE TO SHIFT THE OBLIGATION TO HAVE
THE MEDICARE STRUCTURE, AND THEN ITS OBLIGATION TO CUTOFF FURTHER REIMBURSEMENT
REQUESTS, AND COOPER WANTS TO BE ABLE TO CONTINUE TO BILL THE PIP INSURER
BECAUSE THERE WAS AN UNLIMITED AMOUNT OF ABILITY TO SECURE REIMBURSEMENT FOR THE
800,000, THERE WAS NO CAP ON THE RATE. SO WE'RE LOOKING AT THIS COLLATERAL
SOURCE RULE, AND USING IT TO DETERMINE REIMBURSEMENT RATES, AREN'T WE?
MS. BRADY: SO THE OUTCOME IS WHAT IS REFLECTED IN THAT DELTA THAT
YOUR HONOR IS REFERENCING, IT'S THE OUTCOME OF THE LEGAL PRINCIPLES THAT CONTROL
HERE THAT YIELDS THAT DIFFERENTIAL AND IS UNQUESTIONABLY THE MOTIVATION
DRIVING THE DISTINCTION WHEN COOPER WANTS TO BE ABLE TO BILL SELECTIVE FIRST.
JUSTICE LAVECCHIA: AND IT HAS BEEN ALL ALONG. SO WHEN YOU
CONCEDED BEFORE THAT THE STRUCTURE OF TURNING TO PIP FIRST AND THEN SECURING
COLLECTIBLES UNDERMINES THE POSITION THAT MEDICARE MUST BE THE FIRST PERSON,
THE FIRST ENTITY THAT COOPER TURNS TO. DOES IT NOT? MS. BRADY:
I'M SORRY, WHEN YOU'RE SAYING I CONCEDED BEFORE -- JUSTICE
LAVECCHIA: WHEN WE WERE TALKING ABOUT WORKER'S COMP AND YOU ACKNOWLEDGED THAT
CERTAINLY THERE IS THE STRUCTURE THAT HAS BEEN RECOGNIZED IN OUR COURTS THAT
ALLOWS A MEDICAL PROVIDER TO TURN TO PIP FIRST AND THEN HAVE PIP SECURE ITS
CONTRIBUTIONS OR COLLECTIBLE MONIES FROM THE COLLATERAL SOURCE SOMETIMES
THROUGH A WORKER'S COMP LIEN OR WHATEVER. BUT -- DFNSATTY: WELL I THINK
THE MORE RECENT CASE LAW TELLS THE MEDICARE PROVIDER THAT THEY LOOK TO
WORKER'S COMP FIRST WHEN IT'S READILY AVAILABLE, AND THAT'S THE LAMBERT AND TALMADGE
AND THIS COURT'S DECISION IN AND CHEZ, THEY ALL REFLECT THAT WHEN WORKER'S
COMP IS THERE, YOU GO TO WORKER'S COMP FIRST. JUSTICE LAVECCHIA:
AND HARDY SAID SOMETHING DIFFERENT, IT ACKNOWLEDGED YOU CAN TURN TO PIP FIRST AND
LOOK AT OTHER SOURCES AFTERWARD. MS. BRADY: AND I THINK THAT
IN HARD IT WAS UNCLEAR ON THE FACTS WHETHER THERE WAS A RECALCITRANT
WORKER'S COMPENSATION SKIPPERS P INSURER, WHETHER WORK P HAD EVEN BE INQUIRED OF.
JUSTICE LAVECCHIA: SURE, IT WASN'T THE FOCUS AT THAT POINT.
MS. BRADY: THAT IS CORRECT. JUSTICE ALBIN:
PART OF THE PROBLEM IS TRYING TO HARMONIZE FEDERAL LAW WITH STATE LAW, I THINK
THAT'S WHAT WE'RE ALL TRYING TO GRAPPLE WITH, SO WE HAVE OUR COLLATERAL
SOURCE RULE COLLATERAL SOURCE RULE AND THEN WE HAVE THE FEDS ORIGINAL MEDICARE
LAWS, AND AT LEAST AT THE TIME THAT IS RELEVANT HERE THE PERSON IS MEDICARE
ELIGIBLE. SO LET'S TAKE THE PATIENT GOES TO COOPER, THE PERSON IS MEDICARE ELIGIBLE,
AND THE PERSON HAS PIP. IF PIP PAYS FIRST AND EXTINGUISHES THE MEDICARE,
THAT SEEMS TO BE IN CONFLICT WITH OUR STATE LAW. MS. BRADY:
THAT'S CORRECT, YOUR HONOR. JUSTICE ALBIN: OKAY. BECAUSE OUR STATE
LAW IS LOOKING TO DEDUCT MEDICARE FROM THE PIP, AND THAT'S NOT GOING TO
HAPPEN IF PIP PACE PAYS FIRST. AM I MISTAKEN. MS. BRADY:
THAT IS CORRECT, NO, YOU ARE NOT MISTAKEN. BECAUSE, AND I THINK WE CITED THE STATUTORY
PROVISION IN OUR PAPERS, BUT THERE IS A PROVISION WITHIN THE MEDICARE LAW
THAT SAYS THAT THE OBLIGATION MUST EXIST IN ORDER FOR MEDICARE TO RESPOND, SO IN THAT
SCENARIO, SELECTIVE WOULD HAVE EXTINGUISHED THAT OBLIGATION BY
PAYING, AND SO THAT OUTCOME, AND THIS IS WHAT I WAS TRYING TO GET AT IN MY COLLOQUY
WITH JUSTICE LAVECCHIA, THAT OUTCOME EFFECTIVELY PRECLUDES IMPLEMENTATION
OF THE COLLATERAL SOURCE STATUTE BECAUSE IN THAT INSTANCE THERE IS NO MECHANISM
FOR SELECTIVE TO AVAIL ITSELF OF THE BENEFIT OF ALLOWED UNDER AND REQUIRED
BY NEW JERSEY STATE LAW AS OF 1977. JUSTICE ALBIN: AND THAT WOULD
RENDER AT LEAST IN THAT CIRCUMSTANCE A NULLITY, THE COLLATERAL SOURCE RULE.
MS. BRADY: THAT'S ABSOLUTELY RIGHT, YOUR HONOR.
JUSTICE ALBIN: AND THAT THEREFORE COULD NOT BE CONSONANT WITH AT LEAST STATE POLICY.
MS. BRADY: THAT'S CORRECT, JUDGE. AND THE OTHER THING IT WOULD
DO WHEN YOU LOOK AT FEDERAL LAW AND AGAIN WE SUBMIT THAT NONE OF THESE ISSUES CAN BE
EVALUATED IN A VACUUM BY LOOKING JUST AT STATE LAW OR JUST AT FEDERAL LAW,
YOU HAVE TO LOOK AT THE TWO BODIES OF LAW AND COME UP WITH HOW THEY CAN BE CONSTRUED
IN HARMONY, AND THE OTHER POINT I WOULD MAKE THEN IS IN THAT INSTANCE WHERE
THE BILLS BILL IS TENDERED TO SELECTIVE FIRST, THAT IS A VIOLATION BY COOPER OF
ITS OBLIGATIONS AS A MEDICARE PARTICIPATING PROVIDER. BECAUSE IN
THE INSTANCE WHERE MEDICARE IS PRIMARY, AS IT IS FOR PRE DECEMBER 5TH 1980 ACCIDENTS,
THE LIMITING CHARGE STATUTE OBLIGATES COOPER TO BILL MEDICARE AND ONLY
MEDICARE AND THAT IT CAN RECOUP UNDER THERE STATUTE ONLY THE MEDICARE ALLOWED
AMOUNT PLUS THOSE AMOUNTS DESIGNATED AS THE PATIENT'S RESPONSIBILITY AMOUNT IN
THIS CASE THE 12,236 DOLLAR REMAINDER. SO JUST IN TERMS OF THE MEDICARE
OBLIGATION AS A PRIMARY PAYER FOR PRE 51280 ACCIDENTS, I WANTED TO ADDRESS JUSTICE
LAVECCHIA'S POENTS EARLIER, THE ORIGINAL MEDICARE STATUTE DID UNQUESTIONABLY
PROVIDE FOR MEDICARE PRIMACY FOR ALL INSTANCES OTHER THAN WHERE THERE WERE
AVAILABLE WORKER'S COMPENSATION BENEFITS. AND IT DIDN'T DO SO BY USING THE WORD
PRIMARY BUT IT DID SO BY THE STATUTORY STRUCTURE THAT IT PUT IN PLACE, AND JUST
TO ADDRESS ONE POINT THAT COOPER'S COUNSEL MADE, THE APPELLATE DIVISION ABSOLUTELY
DID ADDRESS THIS STRUCTURE AND WHERE THE PRIMACY DESIGNATION COMES FROM,
BEGINNING ON PAGE 6 OF THE SLIP OPINION TALKING ABOUT THE SOCIAL SECURITY AMENDMENTS
OF 1965. AND JUST TO READ FROM THAT STATUTE, WELL, LET ME BACK UP, THIS IS
THE WAY THE STATUTORY STRUCTURE WORKED UNDER THE MEDICARE ACT WAS IT CREATED A
N ENTITLEMENT TO HAVE PAYMENT MADE FOR ELIGIBLE SERVICES BY ELIGIBLE
BENEFICIARIES, AT ORIGINALLY THOSE JUST OVER AGE 65. IT CREATED AN ENTITLEMENT
AND THEN IT EXPRESSLY DESIGNATED IN AN EXCLUSION SCENARIO THOSE SCENARIOS WHERE
MEDICARE WOULD NOT PAY AS PRIMARY, AGAIN, ALBEIT NOT USING THE WORD PRIMARY,
BUT THE ONLY EXCEPTION IN THE ORIGINAL MEDICARE ABILITY, AND THIS IS IN SECTION
1862 OF THE ORIGINAL PUBLIC LAW, THE ONLY EXCEPTION PROVIDED WAS FOR WORKER'S
COMPENSATION. WE THEN FAST FORWARD TO THE MEDICARE SECONDARY
PAYER ACT IN 1980. THE MEDICARE SECONDARY PAYER ACT REVERSED THAT PRIMACY STRUCTURE
TO RENDER MEDICARE A SECONDARY PAYER, AND IT DID THAT BY AMENDING THE SPECIFIC
EXCLUSION IN THE ORIGINAL ACT THAT REFERENCED ONLY WORKER'S COMPENSATION, AND IT
ADDED ADDITIONAL ENTITIES TO WHICH MEDICARE WOULD SERVE AS SECONDARY,
INCLUDING NO FAULT INSURERS. JUSTICE SOLOMON: DOES IT MATTER THAT
BEFORE 1980, I'M NOT SURE EXACTLY WHAT THE EFFECTIVE DATE IS, BEFORE 1980,
THE INDIVIDUAL, INJURED INDIVIDUAL, WAS NOT A MEDICARE BENEFICIARY? SINCE PRE
1980 AND FRANKLY POST 1980 IT REFERS ONLY TO BENEFICIARIES. AT THE TIME HE WAS
INJURED AND RECEIVING PIP, HE WAS NOT A MEDICARE BENEFICIARY. MS.
BRADY: SO HE WAS NOT AND ARE YOU TALKING GENERALLY OR SPECIFICALLY ABOUT THIS.
JUSTICE SOLOMON: IN THIS CASE, THIS INDIVIDUAL, WAS NOT A
MEDICARE BENEFICIARY, AND MEDICARE IN ITS HIGS TREE TALKS ABOUT BENEFICIARIES,
WAS NOT AR BENEFICIARY. MS. BRADY: CORRECT, SO I'LL START
WITH THE BASIC POINT WHICH IS THIS CASE IS ABOUT SERVICES RENDERED TO THIS
INDIVIDUAL IN 2016. JUSTICE SOLOMON: OH, NO, I UNDERSTAND THAT,
I'M ASKING YOU DOES IT MATTER SINCE THE MEDICARE STATUTE REFERS TO
BENEFICIARIES, THAT PRE 1980 WHEN THIS CHANGE OCCURRED, THIS INDIVIDUAL WAS NOT
A BENEFICIARY, DOES THAT MATTER, AND IF NOT, WHY NOT. MS. BRADY:
SO IT DOES NOT MATTER, AND I'M GOING TO START WITH THE FACTUAL POINT WHICH IS THE
RECORD DOESN'T REFLECT THE PRECISE DATE UPON WHICH MR. MECOUCH BECAME MEDICARE
ELIGIBLE AND IT IS POSSIBLE THAT HE WAS MEDICARE ELIGIBLE PRIOR TO DECEMBER 5TH,
1980. HE BECAME ELIGIBLE BY VIRTUE OF A DISABILITY BROUGHT ABOUT BY THIS
PARTICULAR ACCIDENT WHICH HAPPENED IN JULY OF 1977. JUSTICE
SOLOMON: ASSUME HE BECAME ELIGIBLE AFTER DECEMBER OF '80. MS.
BRADY: SO I WOULD STILL SAY THE ANSWER TO THAT IS NO, AND THE REASON IS THIS, WHEN
THE MEDICARE SECONDARY PAYER ABILITY FLIPPED THE PRIMACY STRUCTURE OF THE
ORIGINAL ACT, IT PROVIDED FOR AN EFFECTIVE DATE OF DECEMBER 5TH, 1980, AND IN ENACT
GO THE IMPLEMENTING REGULATIONS, THE SECRETARY FOR HEALTH AND HUMAN SERVICES
EXPLICITLY FACED THE QUESTIONS OF WHAT IS THE MEANING OF THAT EFFECTIVE DATE AND
DETERMINED LOOKING AT SPECIFICALLY REFERENCED FAIRNESS TO INSURERS THAT IT
WOULD CONSTRUE THAT EFFECTIVE DATE AS RENDERS THE MS MEDICARE SECONDARY PAYER
ACT ONLY ATTRIBUTABLE TO ACCIDENTS THAT HAPPENED AFTER DECEMBER 5TH, 1980. SO
THE MEDICARE SCHEME MAKES RELEVANT ONLY THE DATE OF THE ACCIDENT IN QUESTION
AND IS SIGH LENDER AND GIVES NO IMPORT TO THE DATE OF ELIGIBILITY OF THE PARTICULAR
INDIVIDUAL IN QUESTION AND AGAIN THIS INDIVIDUAL WAS INDISPUTABLY ELIGIBLE
FOR MEDICARE AS FOR SERVICES THAT WERE IN QUESTION HERE. JUSTICE
SOLOMON: ONE OF YOUR ARGUMENTS I THINK WAS THAT ONLY THE EXCLUSIONS PRE 1980 THAT ARE
MENTIONED APPLY, CORRECT, WHERE MEDICARE IS PRIMARY. MS. BRADY:
AND THAT'S ONLY WORKER'S COMP. JUSTICE SOLOMON: ONLY WORKER'S COMP.
WAS THERE ANY SUCH THING AS NO-FAULT INSURANCE PRE 1980, FOR CONGRESS TO
CONSIDER? MS. BRADY: SO THERE'S UNQUESTIONABLY AUTOMOBILE
INSURANCE AND NO-FAULT INSURANCE IS REALLY JUST ONE VERSION OF AUTOMOBILE INSURANCE,
AND THE IMPORT OF YOUR QUESTION IS, IS IT -- AND THIS GOES TO COUNSEL'S
ARGUMENT, IS IT POSSIBLE THAT CONGRESS INTENDED TO SERVE AS PRIMARY TO NO FAULT.
JUSTICE SOLOMON: NOT INTENDED, JUST IT DIDN'T EXIST, AS FAR
AS CONGRESS KNOWS, IT DIDN'T EXIST, WHEN YOU'RE MAKING A PREEMPTION ARGUMENT YOU'RE
MAKING THE ARGUMENT THAT THEY INTENDED TO OCCUPY THE FIELD AND I'M JUST
TRYING TO FIGURE OUT HOW DO WE KNOW THAT THEY INTENDED TO OCCUPY THE FIELD IF WE
ONLY HAVE A COUPLE OF CONGRESSIONAL COMMENTS THAT COULD BE CONSTRUED IN A
NUMBER OF DIFFERENT WAYS. Q. MS. BRADY: SO I THINK THERE'S
TWO TYPES OF PREEMPTION, THERE'S EXPRESS PREEMPTION WHERE YOU LOOK AT INTENT
TO OCCUPY THE FIELD AND THEN THERE'S COULD THIS FLIKT PREEMPTION, AND WHAT WE'VE
ARGUED HERE IS CONFLICT PREEMPTION, IN OTHER WORDS. JUSTICE
SOLOMON: JUSTICE SOLOMON: YOU'RE INDICATING A COLLATERAL
SOURCE -- DFNSATTY: RENDERS IT IN DIRECT CONFLICT WITH THE
MEDICARE STATUTE. JUSTICE SOLOMON: I WAS NOT TALKING ABOUT THAT
BUT I WILL GET TO THAT SINCE YOU RAISED IT. THE COLLATERAL SOURCE RULE DOESN'T
TALK ABOUT INITIAL PAYMENT, IT TALKS ABOUT OFFSETS. DOES IT NOT?
MS. BRADY: IT USES THE WORD -- THE PHRASE DEDUCTED FROM. I THINK IT WAS THE APPELLATE
DIVISION IN -- JUSTICE SOLOMON: THE OBLIGATION -- I'M
TALKING ABOUT THE STATUTE NOW, BECAUSE NOW WE HAVE TO TALK ABOUT A CONFLICT PRE
EMPTION, I'M TALKING ABOUT THE STATUTE, IT SAYS ESSENTIALLY THAT THE PIP CARRIER
IS ENTITLED TO OFFSET THESE OTHER COLLATERAL SOURCES. CORRECT?
MS. BRADY: IT ACTUALLY SAYS DEDUCTED Z FROM. JUSTICE
SOLOMON: ALL RIGHT, LET'S USE THE WORD DEDUCTED, IT CAN DEDUCT THESE OTHER
COLLATERAL SOURCES. MS. BRADY: AND THAT STATUTE SHAB REPEATED
AM CONSTRUED BY THE APPELLATE DIVISION AND BY YOUR HONORS IN AND CHEZ AS
HAVING THE IMPACT OF RENDERING THE COLLATERAL SOURCES PRIMARY.
JUSTICE SOLOMON: THE PRIMARY OBLIGATION. I'M JUST TRYING TO GET BACK TO THE
STATUTE AND FIGURE OUT IF THERE REALLY IS A CONFLICT. THE STATUTE TALKS ABOUT
THIS CONCEPT -- LET ME ASK ONE OTHER QUESTION. WOULD THE KOL COLLATERAL SOURCE
RULE BE RENDERED INEFFECTIVE IF SAY THE PIP CARRIER IN ASSESSING, IN STATING
THE BILL, SIMPLY OFFSET ITS BILL BY THE AMOUNT OF MEDICARE THAT IS PAYABLE. IN OTHER
WORDS, IS THERE ANYTHING OTHER THAN THE OPERATION THAT RENDERS THE STATUTE
INEFFECTIVE, DOES ANYTHING RENDER THE STATUTE INEFFECTIVE. MS.
BRADY: SO THIS GOES BACK TO MY ORIGINAL POINT THAT YOU CAN'T LOOK AT ANYONE OF
THESE LEGAL ISSUES IN ISOLATION FROM THE OTHERS, SO THE SCENARIO WHERE THE
PIP CARRIER OFFSETS BY A MEDICARE PAYMENT, WHERE MEDICARE IS PRIMARY, IS A VIOLATION
OF FEDERAL LAW. JUSTICE SOLOMON: WAIT A MINUTE, YOU'RE
SAYING WHERE MEDICARE IS PRIMARY. MS. BRADY: CORRECT, YOUR HONOR.
JUSTICE SOLOMON: I HAVEN'T GOTTEN TO THAT POINT. I'M STILL
TRYING TO FIGURE OUT WHERE CONGRESS SAID THAT THIS PERSON I'M ASSUMING WAS NOT
A BENEFICIARY AT THE TIME THAT MEDICARE PAID IS NOW -- SOMETHING SAYS THAT
MEDICARE WAS AT THAT TIME PRIMARY. MS. BRADY: I'M STRUGGLING WITH
THE PREMISE BECAUSE THIS INDIVIDUAL WAS MEDICARE ELIGIBLE AT THE TIME THESE
SERVICES WERE RENDERED AND -- JUSTICE SOLOMON: NOT WHAT I'M ASKING.
I'M TRYING TO GET -- HE WAS NOT A BENEFICIARY IN 1977, CORRECT.
MS. BRADY: THANK YOU, YOUR HONOR. JUSTICE SOLOMON: OKAY,
THAT'S ALL I'M GETTING AT, AT THAT TIME IN 1977, HE WAS NOT A BENEFICIARY.
WHAT PRE 1980 SAYS THAT MEDICARE IS PRIMARY, IS PRIMARY, UNLESS OF COURSE, AND
I UNDERSTAND YOU'RE SAYING IF IT'S NOT AN EXCEPTION THEN IT IS PRIMARY.
MS. BRADY: SO THE MEDICARE STATUTE CREATES AN ENTITLEMENT
TO BENEFITS FOR ELIGIBLE BENEFICIARIES. MS. BRADY:
JUSTICE SOLOMON: WHICH HE WAS NOT IN 197. MS. BRADY: BUT THAT
INDICTMENTMENT REMAINS IN THE MEDICARE STATUTE TO THIS DAY.
JUSTICE SOLOMON: RIGHT, CHANGED IN 1980 THOUGH, YOU AGREE WITH ME THERE.
MS. BRADY: CHANGED IN 1980 IN TERMS OF THE EXCEPTIONS TO MEDICARE PAYMENT
AS PRIMARY. BUT CHANGED IN SUCH A WAY THAT THE IMPLEMENTING REGULATIONS
SPECIFICALLY INDICATE THAT THE CHANGE ONLY APPLIES TO POST 12/5/1980 ACCIDENTS.
WHICH THIS ACCIDENT WAS NOT. SO THIS ACCIDENT FALLS INTO THE EXCEPTION TO THE
M.S. P.