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Almost 50 years ago (in 1972), New Jersey passed the No Fault Act, which included the  Personal Injury Protection (PIP) provision, which was intended to “provide prompt payment of medical expenses to  injured parties … (and) eliminate the need to determine fault in a lawsuit before an injured party could recover medical expenses.” Haines v. Taft, 450 N.J. Super. 295 (App. Div. 2017). However, the trade off for this benefit was that the medical expenses, to be paid directly by the injured party’s insurance company, could not again be recovered by the injured party from the tortfeasor. Therefore the medical bills were not boardable (could not be admitted into evidence and displayed on a board for the jury).

Although the Act (N.J.S.A. 39:6A-4) requires the standard automobile policy to provide coverage for medical expenses up to $250,000, payments of medical bills are subject to  any option elected by the insured pursuant to N.J.S.A.39:6A-4.3. This provision permits the insured to choose the amount of PIP coverage for medical expenses in the amount of $15,000; $50,000; $75,000; or $150,000.

In Haines, plaintiff chose the $15,000 PIP coverage option but, as a result of an auto accident, incurred medical expenses of $43,000. Therefore, the issue was whether he could recover the $28,000 expenses in excess of his PIP coverage in his suit against the tortfeasor, i.e. are the excess bills boardable? In a well reasoned decision, Judge Amy O’Connor held that he could, because the Act  “refers to those PIP limits in a standard policy covering the subject insured making inadmissible only those medical expenses up to and including the PIP limits in the insured’s standard policy.” (Emphasis added).

The insurance industry contended that to allow medical bills, in excess of PIP coverage, to be boardable would be a windfall to the injured party who paid a lower premium for the lower PIP coverage. In rejecting this argument, Judge O’Connor pointed out that besides giving up their right to have their medical expenses paid expeditiously by their own insurance company, without regard to fault, such insureds must go through time-consuming litigation and the uncertainty of proving the liability of the tortfeasor, as well as “the necessity and reasonableness” of plaintiff’s treatment  in order to recover the excess medical bills, which “are owed to their medical providers (and therefore) … plaintiffs are not having their cake and eating it too.”

In this author’s experience, as a trial lawyer prior and subsequent to the passage of the No Fault Act, this decision makes sense. Before PIP, a tortfeasor (or his or her insurance company) was responsible for all medical expenses that were proximately cause by the tortfeasor’s negligence. This decision simply continues this procedure of making the tortfeasor (and not the innocent victim) responsible for any medical expenses beyond what an accident victim anticipated when he or she purchased PIP coverage. Or, as Judge O’Connor observed, “an accident victim can hardly be expected to anticipate the severity of his or her injuries, and the consequent expense of his or her medical care, and AICRA (the No Fault Act) is devoid of any legislative intent to have insureds bargain for potentially bankrupting medical bills, in exchange for lower premiums.” Thus, the court considered such excess expenses “a kind of uncompensated economic loss that an injured party may seek to recover against a tortfeasor.”

One might ask how much of an excess over and above an injured party’s PIP coverage is required to permit the excess bills to be boardable? For example, if a plaintiff purchased the minimum PIP coverage of $15,000, and his or her medical expenses amounted to $15,100 or $16,000 or $18,000, are the excess bills, of $100, $1,000, or $3,000 respectively, admissible in evidence, boardable, and recoverable?

In considering this question, the court noted that indeed there will be cases where “an insured may incur medical expenses just above his or her PIP limits that arguably might be minor (and therefore) whether an insured is precluded from recovering such expenses from a tortfeasor is a question.” Although recognizing that, in passing the No Fault Act, the legislature intended “to eliminate minor personal-injury-automobile-negligence cases from the court system,” the court pointed out that in the case before it, plaintiff’s medical bills, over and above his PIP coverage, amounting to $28,000, were clearly not minor. Therefore, the question of what constitutes a “minor” claim was not before the court. For this reason the court decided to “neither reach nor foreclose” this question.

However, in a footnote, the court noted that the legislative history of the Act included a statement, when discussing minor medical expenses, that a case “which ultimately results in a judgment or settlement of under $3,000 is a significant contributing factor to the backlog in the civil courts.” A hint?

We shall see.


Locascio, a Monmouth County Superior Court judge from 1992 until 2009, is now of counsel with the Red Bank office of Gold, Albanese, Barletti & Locascio, where he heads up their civil and family mediation/arbitration department. He is a certified civil and criminal trial lawyer.