Insurance
— Uninsured motorist — Evidence — Collateral source benefits — Evidence of
future Medicare benefits is not admissible — Court recedes from decision in Physician’s
Insurance Reciprocal v. Stanley to the extent that it supported the
admission of social legislation benefits as an exception to the evidentiary
collateral source rule

JOHN JOERG, JR., etc., et al., Petitioners, vs. STATE FARM MUTUAL
AUTOMOBILE INSURANCE CO., Respondent. Supreme Court of Florida. Case No.
SC13-1768. October 15, 2015. Application for Review of the Decision of the
District Court of Appeal – Direct Conflict of Decisions. Second District – Case
Nos. 2D11-6229 & 2D12-1246 (Sarasota County). Counsel: Tracy Raffles Gunn
of Gunn Appellate Practice P.A., Tampa, for Petitioners. Mark David Tinker and
Charles William Hall of Banker Lopez Gassler P.A., Saint Petersburg, for
Respondent. Mark Kenneth Delegal and Matthew Harrison Mears of Holland &
Knight LLP, Tallahassee, and William Wells Large, Florida Justice Reform
Institute, Tallahassee, for Amicus Curiae Florida Justice Reform Institute.
Philip Mead Burlington and Nichole Johnston Segal of Burlington &
Rockenbach, P.A., West Palm Beach, for Amicus Curiae Florida Justice
Association. Maria Elena Abate and Charlyne Michelle Patterson of Colodny, Fass,
Talenfeld, Karlinsky, Abate & Webb, P.A., Fort Lauderdale, for Amici Curiae
Property Casualty Insurers Association of America and National Association of
Mutual Insurance Companies.

(LEWIS, Judge.) Petitioner John Joerg, Jr. (Joerg), on behalf of himself
and as the natural father and guardian of his son Luke Joerg (Luke), seeks
review of the decision of the Second District Court of Appeal in State Farm Mutual Automobile Insurance Co. v. Joerg,
38 Fla. L. Weekly D1378 (Fla. 2d DCA June 21, 2013), on the ground that it
expressly and directly conflicts with the decision in Florida Physician’s
Insurance Reciprocal v. Stanley, 452 So. 2d 514 (Fla. 1984). We agree that
the Second District misapplied Stanley, and we have jurisdiction. See
art. V, § 3(b)(3), Fla. Const.

BACKGROUND

The Collateral
Source Rule

At common law, the collateral source rule governed both evidence and
damages. See, e.g., Gormley v. GTE Prods. Corp., 587 So. 2d 455, 457
(Fla. 1991). Historically, the damages aspect of the collateral source rule
prevented the reduction of damages by collateral sources available to the
plaintiff. Id. This rule rested on the principle that a tortfeasor
should not benefit from the collateral sources available to the plaintiff. Id.
However, the Legislature has abrogated the common law damages rule. Today,
trial courts must reduce awards “by the total of all amounts which have been
paid for the benefit of the claimant, or which are otherwise available to the
claimant, from all collateral sources . . . .” § 768.76(1), Fla. Stat. (2014).
This statutory modification was intended to reduce insurance costs and prevent
plaintiffs from receiving windfalls. See Goble v. Frohman, 901 So. 2d
830, 832 (Fla. 2005); Coop. Leasing, Inc. v. Johnson, 872 So. 2d 956,
959 (Fla. 2d DCA 2004).

There are certain exceptions to this rule. For example, there are no
reductions “for collateral sources for which a subrogation or reimbursement
right exists.” § 768.76(1), Fla. Stat. The statute also explicitly states:

[B]enefits
received under Medicare, or any other federal program providing for a Federal
Government lien on or right of reimbursement from the plaintiff’s recovery, the
Worker’s Compensation Law, the Medicaid Program of Title XIX of the Social
Security Act or from any medical services program administered by the
Department of Health shall not be considered a collateral source.

§768.76(2)(b), Fla. Stat. This exception does not result in a windfall to
plaintiffs because Medicare and similar collateral sources retain a right of
subrogation or reimbursement. See Pollo Ops., Inc. v. Tripp, 906 So. 2d
1101, 1104 n.3 (Fla. 3d DCA 2005); Coop. Leasing, 872 So. 2d at 960.
Additionally, this Court has determined that section 768.76 does not allow
reductions for future medical expenses. Allstate Ins. Co. v. Rudnick,
761 So. 2d 289, 292-93 (Fla. 2000).

As an evidentiary rule, payments from collateral source benefits are not
admissible because such evidence may confuse the jury with respect to both
liability and damages. Sheffield v. Superior Ins. Co., 800 So. 2d 197,
203 (Fla. 2001) (citing Gormley, 587 So. 2d at 458).

[I]ntroduction
of collateral source evidence misleads the jury on the issue of liability and,
thus, subverts the jury process. Because a jury’s fair assessment of liability
is fundamental to justice, its verdict on liability must be free from doubt,
based on conviction, and not a function of compromise. Evidence of collateral
source benefits may lead the jury to believe that the plaintiff is trying to
obtain a double or triple payment for one injury, . . . or to believe that
compensation already received is sufficient recompense.

Gormley, 587 So. 2d at 458 (citing Clark
v. Tampa Elec. Co., 416 So. 2d 475, 476 (Fla. 2d DCA 1982); Kreitz v.
Thomas, 422 So. 2d 1051, 1052 (Fla. 4th DCA 1982)) (internal quotation
marks omitted). It is also well established in Florida that the admission of
evidence of social legislation benefits such as those received from Medicare,
Medicaid, or Social Security, is considered highly prejudicial and constitutes
reversible error. See Sheffield, 800 So. 2d at 203; Velilla v. VIP
Care Pavilion Ltd., 861 So. 2d 69, 71 (Fla. 4th DCA 2003) (citing Parker
v. Hoppock, 695 So. 2d 424, 428 (Fla. 4th DCA 1997)); see also Benton v.
CSX Transp., Inc., 898 So. 2d 243, 245 (Fla. 4th DCA 2005) (“The
inadmissibility of collateral sources evidence enjoys a long history of legal
precedent.” (citing Eichel v. N.Y. Cent. R.R. Co., 375 U.S. 253
(1963))).

Unlike the common law damages aspect of the collateral source rule, the
evidentiary collateral source rule remains largely intact. See Gormley,
587 So. 2d at 459. The notable exception at issue here is the rule announced by
this Court in Stanley.1 The plaintiffs in Stanley alleged that
the defendants’ medical negligence resulted in the intellectual disability and
cerebral palsy suffered by their son. 452 So. 2d at 515. To establish future
damages, the plaintiffs presented evidence that their son would require
physical therapy, speech therapy, and special education over the course of his
life. The defendants were permitted to introduce evidence of “free or low-cost
charitable and governmental programs available in the community to meet” the
needs of the plaintiffs’ son. Id. This Court held:

[E]vidence of
free or low cost services from governmental or charitable agencies available to
anyone with specific disabilities is admissible on the issue of future damages.
. . . Such evidence violates neither the statutory nor the common-law
collateral source rule and does not, therefore, require a new trial.

. . . .

We believe that
the common-law collateral source rule should be limited to those benefits
earned in some way by the plaintiff. Governmental or charitable benefits
available to all citizens, regardless of wealth or status, should be admissible
for the jury to consider in determining the reasonable cost of necessary future
care. Keeping such evidence from the jury may provide an undeserved and
unnecessary windfall to the plaintiff.

Id. The Court emphasized that such
evidence should not limit how the jury calculates damages:

The jury
remains free to find that the publicly available services do not meet the
plaintiff’s future needs. The jury may find private care at higher cost more
appropriate in some circumstances, but the jury should consider those future
services available to all, regardless of wealth or status, when deciding on the
proper award of future damages.

Id. at 516.

In support of this holding, the Court relied at that time exclusively upon
the only available authority, a decision of the Illinois Supreme Court, which
was subsequently quashed:

[T]he policy
behind the collateral-source rule simply is not applicable if the plaintiff has
incurred no expense, obligation, or liability in obtaining the services for
which he seeks compensation. . . . It is a well-settled rule of damages that
the amount recoverable for tortious personal injuries is not decreased by the
fact that the injured party has been wholly or partly indemnified for the loss
by proceeds from accident insurance where the tortfeasor did not contribute to
the payment of the premiums of such insurance. This rule is usually justified
on the basis that the wrongdoer should not benefit from the expenditures made
by the injured party in procuring the insurance coverage. . . . In a situation
in which the injured party incurs no expense, obligation, or liability, we see
no justification for applying the rule.

Id. at 515-16 (citing Peterson v.
Lou Bachrodt Chevrolet Co., 392 N.E.2d 1, 5 (Ill. 1979), overruled by
Wills v. Foster, 892 N.E.2d 1018 (Ill. 2008)) (internal citations,
quotations, and emphasis omitted). In a dissenting opinion, Justice Shaw,
joined by Justices Adkins and Boyd, contended that the Court’s reliance on Peterson
was misplaced. According to Justice Shaw, the Peterson court considered
only past damages, not the future damages that were at issue in Stanley. Id.
at 517 (Shaw, J., dissenting). He also disagreed with the policy position
articulated in Peterson and adopted by the majority of the Court:

There is simply
no assurance that public assistance will continue, that the injured victim will
continue to be eligible for such assistance if it continues, or that the
assistance, if it continues, will continue at the same level. By denying the
victim full compensation for the cost of future care, the majority opinion
transfers the responsibility for the tort from the tortfeasor, where it legally
and morally belongs, to the victim and the community. I cannot agree that an
injured victim should be required to seek charity or public aid, or that the
compassion of charitable contributors and taxpayers should become a device for
reducing the legal liability of a tortfeasor.

Id.

The courts of this state have struggled to apply Stanley. Rather,
courts have frequently limited Stanley to its facts and usually
concluded that Stanley does not apply. See Gormley, 587 So. 2d at
458 (homeowner’s insurance benefits not admissible under Stanley because
plaintiffs had paid for them); Nationwide Mut. Fire Ins. Co. v. Harrell,
53 So. 3d 1084, 1087 (Fla. 1st DCA 2010) (concluding that Stanley did
not govern the admissibility of payments made by a private health insurer); Weaver
v. Wilson, 532 So. 2d 67, 68 (Fla. 1st DCA 1988) (declining to apply Stanley
to benefits paid by an employer/parent because such a relationship “create[s]
mutual obligations and liabilities, and the benefits paid to an employee or to
a child cannot be characterized as ‘unearned’ in the sense used in Stanley,
or as benefits available to all citizens.”).

Florida courts have particularly wrestled with whether Stanley
requires the admission of Medicare or Medicaid benefits. In Velilla, the
Fourth District Court of Appeal reversed and remanded for a new trial after it
determined that the admission of past Medicaid benefits was erroneous because
of its prejudicial effect. 861 So. 2d at 71-72. The court in Velilla
relied on Parker, in which the Fourth District questioned the emphasis
that courts have placed on whether such benefits are “free”:

While there is
dicta in Stanley that the “common-law collateral source rule [excluding
testimony about benefits received by a plaintiff] should be limited to those
benefits earned in some way by the plaintiff,” 452 So. 2d at 515, the term
“collateral sources” has never been limited to those benefits that a plaintiff
has earned or paid for.

Parker, 695 So. 2d at 428 (footnote
omitted).2 Additionally, past Medicare benefits have been
found to be inadmissible under Stanley because the benefits were
partially paid for by deductions from the plaintiff’s Social Security checks
and therefore qualified as an expense or liability under Stanley. Winston
Towers 100 Ass’n, Inc. v. De Carlo, 481 So. 2d 1261, 1262 (Fla. 3d DCA
1986). But see Velilla, 861 So. 2d at 71 (suggesting that evidence of future
Medicare or Medicaid benefits may be admissible under Stanley). Indeed,
until the Second District issued the decision below, no Florida court had
definitively concluded that future Medicare benefits are admissible under Stanley.
See Joerg, 38 Fla. L. Weekly at D1378.

This Case

Luke Joerg is a developmentally disabled adult who has lived with his
parents his entire life and has never worked. As a result of his disabilities,
Luke is entitled to reimbursement from Medicare for his medical bills. On
November 19, 2007, Luke was riding his bicycle in Venice, Florida, when he was
struck by a car. Joerg filed a negligence action against the driver and
Respondent State Farm Mutual Automobile Insurance Company (State Farm), Joerg’s
uninsured motorist carrier. Prior to trial, Joerg withdrew his action against
the driver and proceeded against State Farm exclusively.

Joerg filed a motion in limine to exclude evidence of any collateral
source benefits to which Luke was entitled, including discounted benefits under
Medicare and Medicaid. The trial court initially granted Joerg’s motion, but
only with respect to past medical bills. After Joerg moved for reconsideration,
the trial court vacated its prior ruling and allowed State Farm to introduce
evidence of “future medical bills for specific treatment or services that are
available . . . to all citizens regardless of their wealth or status.” However,
it precluded State Farm from introducing evidence of Luke’s future Medicare or
Medicaid benefits. After a four-day trial, the jury returned a verdict in favor
of Joerg. The jury awarded a total of $1,491,875.54 in damages, including
$469,076 for future medical expenses.

State Farm appealed to the Second District regarding several evidentiary
matters. The Second District affirmed the trial court’s rulings on all
evidentiary issues without explanation, with the exception of the admissibility
of Luke’s future Medicare benefits. Joerg, 38 Fla. L. Weekly at D1378.
The district court noted that section 768.76, Florida Statutes, which
statutorily amended the damages aspect of the common law collateral source rule
two years after the decision in Stanley, left the viability of Stanley
in question. Id. at D1378-79. However, the court determined that neither
the setoff statute nor the decision of this Court in Rudnick, 761 So. 2d
at 292-93, which held that future medical payments are not subject to the
statutory setoff, altered Stanley. Joerg, 38 Fla. L. Weekly at D1379.
Therefore, the Second District concluded that, under Stanley, Luke’s
Medicare benefits were free and unearned and therefore should not have been
excluded by the collateral source rule. Id. at D1379-80. The district
court reversed the award for future damages and remanded for further
proceedings. Id. at D1380. Review in this Court has followed.

ANALYSIS

Whether the exception to the collateral source rule created in Stanley
applies to future benefits provided by social legislation such as Medicare is a
purely legal question. Therefore, we review this issue de novo. See, e.g.,
Bakerman v. The Bombay Co., 961 So. 2d 259, 261 (Fla. 2007). The Second
District determined that because there was no evidence that Luke paid for his
Medicare benefits, these benefits were free and unearned under Stanley.
Not only does this conclusion overlook details contained within the record,3 but it also ignores the discussion in Stanley
that collateral sources may qualify as an expense, obligation, or liability to
the plaintiff. See 452 So. 2d at 515-16. We conclude that future
Medicare benefits are both uncertain and a liability under Stanley, due
to the right of reimbursement that Medicare retains.

In 1980, Congress passed the Medicare Secondary Payer Act (MSPA) to reduce
Medicare spending. See, e.g., Stalley v. Methodist Healthcare, 517 F.3d
911, 915 (6th Cir. 2008). This statute requires “primary payers,” which include
automobile insurance plans such as the one Joerg holds with State Farm, to pay
for related medical costs for policy holders before Medicare, the “secondary
payer,” is required to pay. 42 U.S.C. § 1395y(b)(2) (2014); see also
Stalley, 517 F.3d at 915. However, Medicare is authorized to make
conditional payments in the event that a primary payer “has not made or cannot
reasonably be expected to make payment . . . promptly.” 42 U.S.C. § 1395y(b)(2)(B)(i).
As the Eleventh Circuit Court of Appeals has explained:

The way the
system is set up the beneficiary gets the health care [he or] she needs, but
Medicare is entitled to reimbursement if and when the primary payer pays [him
or] her. Among other avenues of reimbursement, Medicare is subrogated to the
beneficiary’s right to recover from the primary payer. 42 U.S.C. §
1395y(b)(2)(B)(iii). Medicare regulations extend that subrogation right to any
judgments or settlements “related to” injuries for which Medicare paid medical
costs, thereby casting the tortfeasor as the primary payer. 42 C.F.R. §
411.37 (2002).

Cochran v. U.S. Health Care Fin. Admin., 291 F.3d 775, 777-78 (11th Cir. 2002)
(emphasis supplied).

The Centers for Medicare and Medicaid Services (CMS) may employ several
tools to enforce the MSPA. CMS may file an independent cause of action “against
any or all entities that are or were required or responsible . . . to make
payment . . . under a primary plan.” 42 U.S.C. § 1395y(b)(2)(B)(iii). In such
actions, the United States may recover double damages. Id. “In addition,
the United States may recover under this clause from any entity that has
received payment from a primary plan or from the proceeds of a primary plan’s
payment to any entity.” Id. CMS regulations have clarified that “any
entity” includes beneficiaries, providers, suppliers, physicians, attorneys,
state agencies, and private insurers. 42 C.F.R. § 411.24(g) (2014); U.S. v.
Harris, No. 5:08CV102, 2009 WL 891931, at *3, *5 (N.D. W. Va. Mar. 26,
2009) (awarding judgment to the United States against a plaintiff’s attorney to
satisfy the government’s subrogation claim), aff’d, 334 Fed. Appx. 569
(4th Cir. 2009). Finally, liability insurers with claims submitted by Medicare
beneficiaries must report such claims, along with any related settlements, to
the Department of Health and Human Services. Medicare, Medicaid, and SCHIP
Extension Act of 2007, Pub. L. 110-173 (2007) (codified as amended at 42 U.S.C.
§1395y(b)(8)). Failure to comply with the reporting requirement results in a
$1,000 per day, per claim civil penalty. See id.; see also generally
Jason D. Lazarus, Medicare Myths: What Every Trial Lawyer Should Know About
the MSP and Liability Medicare Set Asides, Fla. B.J., Nov. 2010, at 46. These
tools apply regardless of the basis of the beneficiary’s eligibility for
Medicare. See 44 C.F.R. § 411.20 (subtitled “Insurance Coverage That
Limits Medicare Payment: General Provisions”).

With such enforcement tools, future Medicare benefits constitute a serious
liability for all beneficiaries. See Black’s Law Dictionary 1053
(10th ed. 2014) (defining liability as either “1. The quality, state, or
condition of being legally obligated or accountable; legal responsibility to
another or to society, enforceable by civil remedy or criminal punishment . . .
.” or “2. A financial or pecuniary obligation in a specific amount.”).
Regardless of whether an individual has directly paid for his or her Medicare
benefits, a factual matter which is unclear from the record before this Court,
all Medicare beneficiaries who receive an award for future medical damages will
be liable to reimburse Medicare, if Medicare makes a conditional payment on
their behalf. Therefore, the assertion by State Farm that any Medicare and Medicaid
benefits provided to Luke are free and admissible under Stanley is
unsupported under the law.

Moreover, CMS’s ability to enforce the right of reimbursement of Medicare
benefits makes it apparent that the exclusion of evidence of Medicare and similar
collateral source benefits will not result in undue windfalls to plaintiffs
such as Joerg. Florida courts have recognized that the exemption for Medicare
in the collateral source damages statute does not create undue windfalls for
plaintiffs. Pollo Ops., Inc., 906 So. 2d at 1104 n.3 (explaining that
the exclusion of Medicare benefits from the definition of statutory collateral
sources exists because of the right of reimbursement retained by the federal
government); Coop. Leasing, 872 So. 2d at 960 (“Section 768.76 excludes
Medicare benefits as a collateral source because the federal government has a
right to reimbursement from Johnson’s recovery for payments it has made on her
behalf.”); cf. Gormley, 587 So. 2d at 457 (noting that the collateral
source rule does not provide a double recovery to plaintiffs who have
personally paid for their benefits). Thus, the dual functions of the collateral
source rule are to be harmonized: although evidence that may confuse the jury
as to both liability and damages should not be admitted, Sheffield, 800
So. 2d at 203, any potential windfalls to the plaintiff that might occur
through the exclusion of such evidence are minimized by judicial reductions to
the damage award by any collateral source, which occurs outside of the jury’s
presence. § 768.76, Fla. Stat.4 No windfalls result when an entity that
provided the collateral source retains a right of reimbursement from the award
of damages.

Additional policy concerns support our conclusion today. First, our
holding is consistent with the recognition of the inherently prejudicial effect
of evidence of collateral source benefits. See Eichel, 375 U.S. at 255
(explaining that the prejudicial value of the admission of collateral source
benefits available under a federal statute outweighed the probative value of
the evidence to demonstrate malingering by the plaintiff); Sheffield,
800 So. 2d at 203-04 (citing Gormley, 587 So. 2d at 458). Evidence of
eligibility for Medicare, Medicaid, welfare, and similar social legislation
benefits may have an even greater prejudicial impact on juries. E.g.,
Parker, 695 So. 2d at 428 (“The very image of a plaintiff as one who
accepts governmental hand-outs carries a substantial likelihood of prejudice
that outweighs any marginal probative value.”).

Moreover, it is absolutely speculative to attempt to calculate damage
awards based on benefits that a plaintiff has not yet received and may never
receive, should either the plaintiff’s eligibility or the benefits themselves
become insufficient or cease to continue. Even where very particular benefits
exist, extensive waiting lists may prevent an individual from actually receiving
the benefit.5 The continued existence and sufficient funding
of public services depend upon legislative action, which is by no means a
predictable matter: “To encourage juries to mitigate damages based on tenuous
public resources forces plaintiffs, like the foolish house builder in the
parable, to rebuild lives on shifting sands. The floods may come, and the winds
blow, and great will be the fall.” Cates v. Wilson, 361 S.E.2d 734, 739
(N.C. 1987).6 In cases that involve presumptive Medicare
reimbursements, it is even more speculative to anticipate a reduction of future
damages because the structure of the MSPA is intended to prevent Medicare from
paying if there is forthcoming payment from a primary payer. See Cochran,
291 F.3d at 777-78.

Finally, to consider Medicare, Medicaid, and other similar social
legislation benefits as exceptions to the general rule that precludes admission
of collateral sources circumvents the purpose of the collateral source rule. It
is a basic principle of law that tortfeasors should not receive a windfall due
to benefits available to the injured party, however those benefits were
accrued. See Restatement (Second) of Torts § 920A cmt. b (1979) (“The
law does not differentiate between the nature of the benefits, so long as they
did not come from the defendant or a person acting for him.”); see also
Gormley, 587 So. 2d at 457 (“The collateral source rule permits an injured
party to recover full compensatory damages from a tortfeasor irrespective of
the payment of any element of those damages by a source independent of the
tortfeasor.” (citing 3 Jerome H. Nates et al., Damages in Tort Actions
§ 17-5 (1988)) (emphasis supplied)). We now agree with the dissent in Stanley
that tortfeasors — and here, those who insure against the actions of
tortfeasors — should not enjoy such a windfall at the expense of taxpayers who
fund social legislation benefits.

At this point, we recognize the need to recede from our previous position
articulated in Stanley. As discussed, no court of this state has
successfully applied Stanley. Moreover, Stanley has become the
minority rule in this country. See Wills, 892 N.E.2d at 1023;
Restatement (Second) of Torts § 920A cmt. c (4) (noting that social legislation
benefits are subject to the collateral source rule of damages). We also
consider it noteworthy that Peterson, the decision relied upon
extensively and exclusively for support in Stanley, has recently been
overruled. Wills, 892 N.E.2d at 1031. We need not repeat the thorough
and persuasive analysis provided by the Illinois Supreme Court here, other than
to agree that the tortfeasor should not benefit from collateral funds that are
available to the injured party and wholly independent of the tortfeasor. See
id. at 1023-31.7 Therefore, we recede from Stanley to
the extent that it supported the admission of social legislation benefits as an
exception to the evidentiary collateral source rule. Stanley was a very
narrow exception to the collateral source rule that considered specific
benefits, which in that case included special needs education and therapy,
which can no longer be supported. It was never intended to apply to benefits
from Medicare or Medicaid, or to collateral sources where a right of
reimbursement or subrogation exists, because such rights necessarily complicate
the freely available nature of the benefits that were at issue in Stanley.
Further, the uncertainty of the future for any social legislation benefits is
far too great to permit damage reductions.

CONCLUSION

To affirm the decision below would result in a new trial in which State
Farm would be permitted to present confusing, prejudicial, and speculative
evidence of Luke Joerg’s future entitlement to Medicare benefits, when State
Farm would not otherwise be permitted to seek a reduction of the value of these
benefits from any award Joerg might receive. This we cannot allow. We conclude
that the trial court properly excluded evidence of Luke Joerg’s eligibility for
future benefits from Medicare, Medicaid, and other social legislation as
collateral sources. We therefore quash the decision below and remand for
further proceedings consistent with this opinion.

It is so ordered. (LABARGA, C.J., and PARIENTE, QUINCE, and PERRY, JJ.,
concur. POLSTON, J., dissents with an opinion, in which CANADY, J., concurs.)

__________________

1Additionally, district courts have noted that evidence of collateral
payments may be admitted on a limited basis to rebut a party’s theory of a
case, establish liability in non-negligence actions, or prevent attempts to
mislead the jury. E.g., Citizens Prop. Ins. Corp. v. Ashe, 50 So. 3d
645, 652-53 (Fla. 1st DCA 2010); Rease v. Anheuser-Busch, Inc., 644 So.
2d 1383, 1387 (Fla. 1st DCA 1994); State Farm Mut. Auto. Ins. Co. v. Gordon,
712 So. 2d 1138, 1139-40 (Fla. 3d DCA 1998).

2Other district courts have disagreed with this position. See Joerg,
38 Fla. L. Weekly at D1378 n.2; Harrell, 53 So. 3d at 1087 (“[I]t is
relatively clear that our supreme court intended to limit abrogation of the
evidentiary portion of the collateral source rule to cases where the benefits
received to reduce the cost of medical care were not earned (or paid for) in
some way by the plaintiff.”).

3The record contains no direct evidence in the form of pay stubs, Social
Security checks with itemized deductions, or testimony as to Luke’s specific
benefits, because the trial court excluded such evidence. There are several
unchallenged arguments that Luke’s Social Security benefits were assessed to
pay Medicare, and that Medicare retains a right of reimbursement with regard to
any resulting settlement. State Farm, as the proponent of the argument that
Luke’s benefits were free and therefore admissible under Stanley, bore
the burden of establishing such. See Weaver, 532 So. 2d at 68 n.2
(“[B]efore a defendant can receive the benefit of the Supreme Court’s holding
in Stanley, the defendant carries the burden of proof that the plaintiff
did not incur an ‘expense, obligation, or liability’ in obtaining the benefit
at issue.” (citation omitted)).

This issue arose several times before and during trial. State Farm had
ample opportunity to seek further discovery and controvert Joerg’s assertion
that a portion of Luke’s Social Security benefits were assessed to pay Medicare
and that his benefits were therefore not free. Our review of the record leads
us to conclude that State Farm failed to establish the Medicare benefits here were
free. See id.

4We also reject the cramped interpretation of the Second District regarding
future setoffs under section 768.76. Section 768.76 requires a judge to set off
the value of most collateral source benefits from a damages award; however, the
statute excludes benefits received under Medicare or programs with a right of
reimbursement from the definition of collateral sources for the purpose of
the setoff statute. § 768.76, Fla. Stat. The district court below concluded
that section 768.76(2)(b) creates an exception only for previously earned
Medicare benefits, not for future unearned benefits. Joerg, 38 Fla. L.
Weekly at D1379. However, in Rudnick, we held that although benefits
that have been received by the plaintiff must be set off against an award for
damages, future collateral benefits are not subject to setoff. 761 So.
2d at 292-93; see also White v. Westlund, 624 So. 2d 1148, 1153 (Fla.
4th DCA 1993) (“Florida courts . . . have implicitly, if not expressly, held
that future earned disability benefits cannot be set off from an award as a
collateral source under section 768.76.” (citations omitted)); Swamy v.
Hodges, 583 So. 2d 1095, 1096-97 (Fla. 1st DCA 1991) (affirming the refusal
of a trial court to grant a setoff for future Social Security benefits); Measom
v. Rainbow Connection Preschool, Inc., 568 So. 2d 123, 124 (Fla. 5th DCA
1990) (reversing a setoff for future medical expenses under section 768.76(1)).

5For example, the Agency for Persons with Disabilities maintains an
extensive waiting list for services available to individuals with particular
disabilities. See § 393.065, Fla. Stat. (2014). Some never receive the
benefits which otherwise appear to be available in theory only.

6Although the court in Cates considered a variety of collateral source
benefits, including free special education such as was at issue in Stanley,
the North Carolina Supreme Court ultimately held that the admission of Medicaid
and state welfare benefits and child support payments alone required a new
trial. Cates, 361 S.E.2d at 737, 739.

7Like Peterson, the Illinois Supreme Court in Wills also
considered the admissibility of past Medicare benefits, not the future benefits
at issue here. Wills, 892 N.E.2d at 1020. Given our agreement with the
policy pronouncement in Wills, we do not consider this factual
distinction relevant.

__________________

(POLSTON, J., dissenting.) This Court does not have the constitutional
authority to review this case because the Second District’s decision in State
Farm Mutual Automobile Insurance Co. v. Joerg, 38 Fla. L. Weekly D1378
(Fla. 2d DCA June 21, 2013), does not expressly and directly conflict with this
Court’s decision in Florida Physician’s Insurance Reciprocal v. Stanley,
452 So. 2d 514 (Fla. 1984), on the same question of law. See, art. V, §
3(b)(3), Fla. Const.

In Stanley, 452 So. 2d at 515, this Court held that “evidence of
free or low cost services from governmental or charitable agencies available to
anyone with specific disabilities is admissible on the issue of future
damages.” This Court in Stanley stated that “the common-law collateral
source rule should be limited to those benefits earned in some way by the
plaintiff. Governmental or charitable benefits available to all citizens,
regardless of wealth or status, should be admissible for the jury to consider
in determining the reasonable cost of necessary future care.” Id.
Relying on this Court’s decision in Stanley, the Second District held
that Joerg’s receipt of medical services from Medicare is admissible to
determine future damages because Joerg did not contribute to or pay for the
Medicare benefits. Joerg, 38 Fla. L. Weekly at D1379. Specifically, the
Second District explained that “[n]o record evidence shows that Joerg
contributed to the financing of the Medicare program;” therefore, Joerg’s
Medicare benefits “are unearned under Stanley and not subject to
exclusion under the collateral source rule.” Id. at D1379-80.
Accordingly, because both this Court in Stanley and the Second District
in Joerg concluded that only government benefits earned in some way by
the plaintiff should be excluded from evidence under the collateral source
rule, no conflict exists.

I respectfully dissent. (CANADY, J., concurs.)