Our Positions | Phantom Damages

Those who are injured by others generally have the right to recover the reasonable cost of medical expenses from the person who caused the injury. Determining what the reasonable cost is sounds simple enough, but becomes complicated in an age of medical treatment and financing in which agreements between payors and provider networks. Often, what is billed bears little relation to what is accepted as full payment for medical services.

Typically, billed amounts are much higher than what is actually paid. If a jury determining damages in a court case is able to see only what is billed for medical services rather than what is actually paid it will often award an amount that is far greater than what the medical services actually cost. This payment of “phantom damages” essentially results in a windfall for the injured party.

NAMIC Position

Determining damages based on the reasonable cost of medical care requires that the actual cost of medical services can be introduced as evidence in any case involving injury. NAMIC supports the elimination of phantom damages through legislation and appellate court decisions.

NAMIC News on Phantom Damages


Erin Collins
Senior Vice President - State and Policy Affairs