United States District Court, E.D. Louisiana
ORDER AND REASONS
ZAINEY, UNITED STATES DISTRICT JUDGE
following motion is before the Court: Motion for
Partial Summary Judgment on the
“Manderson” Issue (Rec. Doc.
101) filed by plaintiff Mary Fairley. Defendant ART
Catering, Inc. opposes the motion. The motion, noticed for
submission on January 24, 2018, is before the Court on the
briefs without oral argument.
late Mr. Ronnie Fairley was a Jones Act seaman employed by
defendant ART Catering, Inc. in July and August 2015. Fairley
was assigned to duties aboard the D/S TITANIUM EXPLORER.
Fairley's last day on the vessel was August 7, 2015. On
the night of August 7-8, 2015, Fairley presented at the
emergency room with irregular heartbeat and labored
breathing. He was diagnosed with right foot gangrene,
cellulitis of the foot, and sepsis. From August 8, 2015
through August 22, 2015, the date of his death, Fairley's
condition was grave and he remained hospitalized.
purposes of this motion the Court accepts as true the
pertinent facts as Plaintiff presents them: The medical bills
associated with Fairley's illness were significant,
approximately $520, 000.00. At all relevant times Fairley was
insured by a Blue Cross - Blue Shield of Louisiana
(“BCBS”) health insurance policy. The BCBS policy
excludes coverage for any services covered by worker's
comp and/or rendered as a result of occupational
injury. All of the medical expenses associated
with Fairley's August 2015 illness were paid by BCBS.
BCBS had a bill reduction agreement with the health care
providers so the bills were satisfied for $75, 000.00.
Therefore, the difference between the amount invoiced and the
amount accepted is $445, 000.00.
times relevant Art Catering was insured by a maritime
employer's liability (“MEL”) policy that
covered all sums that Art Catering was legally obligated to
pay, as an employer, for maintenance and cure arising out an
employee's work-related injury. Neither Art Catering nor its
MEL insurer had a bill reduction agreement with Fairley's
healthcare providers. Therefore, if ART Catering or its
maritime insurer had paid Fairley's medical bills from
August 2015, they would have been required to pay the entire
billed amount of $520, 000.00.
sole issue presented by Plaintiff's motion for partial
summary judgment is whether the Fifth Circuit's decision
in Manderson v. Chet Morrison Contractors, Inc., 666
F.3d 373 (5th Cir. 2012), applies to this case.
Plaintiff contends that it does not. Defendant contends that
recognizes that the collateral source rule is a creature of
tort law, and therefore is incompatible with the cure
obligation, which is not fault-based. 666 F.3d at 381. Cure
allows the seaman to recover only those expenses
“actually incurred, ” in other words, the amount
needed to satisfy his medical charges. Id. at 382
(citing Davis v. Odeco, Inc., 18 F.3d 1237, 1246
(5th Cir. 1994); Boudreaux v. United
States, 280 F.3d 461, 468 (5th Cir. 2002)).
This applies whether the charges are incurred by a
seaman's insurer on his behalf and then paid at a
written-down rate, or incurred and then paid by the seaman
himself, including at a non-discounted rate. Id.
Insofar as the collateral source rule does apply to an award
of cure, it is in the context where a seaman alone purchases
medical insurance. Id. at 381. Where a seaman alone
purchases medical insurance, the shipowner is not entitled to
a set-off from the cure obligation for the funds that the
seaman receives from his insurer. Id. The reasoning
behind this exception is that the policy of protecting
injured seamen would be hampered if a shipowner, in hopes of
reducing his liability, delayed maintenance and cure in order
to force a seaman to look first to his private insurer.
holding of Manderson is that even where the seaman
purchases his own medical insurance, the appropriate amount
for cure is the lesser amount of what the medical providers
accept as full payment from the insurer-not the greater,
undiscounted amount actually charged by the providers.
Id. at 382.
that Fairley's medical expenses from August 2015
constituted cure,  Manderson directs that the cure
award in this case would be limited to the $75, 000.00
actually incurred for medical expenses, even if Fairley alone
purchased the BCBS policy. Per Manderson, cure in this
case would not include the $445, 000.00 of expenses that were
written off under BCBS's agreements with the providers.
position is that the Manderson holding should not
apply because the wrong policy paid for the medical expenses.
According to Plaintiff, BCBS had no obligation to pay
Fairley's medical expenses because its work injury
exclusion was triggered; meanwhile, ART Catering's policy
covered work-related injuries and therefore should have paid
the medical expenses totalling $520, 00.00. According to
Plaintiff, ART Catering and its MEL insurer should not reap
the benefit of a $445, 000.00 windfall to the detriment of
BCBS and the healthcare providers. Plaintiff contends that if
the Manderson rule is not applied to her case, ART
Catering will be far less likely in the future to allow the
wrong insurer to pay for its cure obligations.
arguments lack merit. Plaintiff cannot recover as a cure
award the $445, 000.00 that presumably would have been paid
to the healthcare providers under the MEL policy because
those expenses were not actually incurred. Plaintiffs only
interest insofar as cure is concerned is to have the employer
cover the medical expenses actually incurred. BCBS paid those
expenses discounted to $75, 000.00, and ART Catering
satisfied the subrogation lien. Plaintiff's position, which
seeks to impose a punitive cure charge on ART Catering, is
unsupported by any authority and wholly inimical to the
nature of the cure obligation.
and for the foregoing reasons;
IS ORDERED that the Motion for Partial
Summary Judgment on the “Manderson”
Issue (Rec. Doc. 101) ...