B-158093, JAN 26, 1966

B-158093, JAN 26, 1966

COMPTROLLER GENERAL OF THE UNITED STATES

BRIGADIER GENERAL NORMAN E. PEATFIELD, USA, DEPARTMENT OF THE NAVY:

FURTHER REFERENCE IS MADE TO YOUR LETTER DATED NOVEMBER 16, 1965, REQUESTING A DECISION ON SETOFF OF PUBLIC FUNDS AGAINST THE SETTLEMENT RECEIVED BY AN INJURED PARTY ARISING OUT OF A TORT COMMITTED PRIOR TO 1 JANUARY 1963. YOUR REQUEST WAS FORWARDED HERE BY FIRST ENDORSEMENT DATED NOVEMBER 24, 1965, FROM THE JUDGE ADVOCATE GENERAL OF THE NAVY.

WHILE YOUR REQUEST IS GENERAL IN NATURE, IT IS PROMPTED BY THE AUTOMOBILE ACCIDENT ON AUGUST 9, 1962, INVOLVING GUNNERY SERGEANT HARLAND P. MOULTON, USMC, AND HIS FAMILY, WHICH WAS CAUSED BY THE WRONGFUL ACT OF A THIRD PARTY. MRS. EVELYN V. MOULTON AND THEIR DAUGHTER, SANDRA, BOTH OF WHOM SUFFERED EXTENSIVE INJURIES, WERE TREATED IN CIVILIAN MEDICAL FACILITIES AND PART OF THE EXPENSES INCURRED IN THE AMOUNT OF $4,789.65 HAS BEEN PAID FROM GOVERNMENT FUNDS UNDER THE DEPENDENTS MEDICAL CARE PROGRAM. PAYMENT OF THE BALANCE OF THE CIVILIAN MEDICAL BILLS HAS BEEN WITHHELD. THE MOULTONS HAVE RECEIVED A SETTLEMENT OF $200,000 FROM THE THIRD PARTY TORTFEASOR, $100,000 OF WHICH WAS PAID BY THE INSURANCE CARRIER. DEMAND HAS BEEN MADE FOR RECOVERY OF THE PUBLIC FUNDS EXPENDED FOR MEDICAL CARE BUT NO PAYMENT HAS BEEN RECEIVED.

ALTHOUGH THE ACCIDENT OCCURRED PRIOR TO THE EFFECTIVE DATE OF THE ACT OF SEPTEMBER 25, 1962, PUB. L. 87-693, 76 STAT 593, 42 U.S.C. 2651 2653, EFFECTIVE JANUARY 1, 1963, GIVING THE UNITED STATES THE RIGHT TO RECOVER FROM THIRD PARTY TORTFEASORS THE REASONABLE VALUE OF HOSPITAL AND MEDICAL CARE AND TREATMENT FURNISHED BY THE GOVERNMENT, IT IS YOUR POSITION THAT THE GOVERNMENT IS ENTITLED TO RECOVERY IN THIS CASE AND SIMILAR CASES. THIS POSITION IS PREDICATED UPON OUR DECISIONS B-107906 OF APRIL 23, 1952, 31 COMP. GEN. 534 AND B-147227 OF NOVEMBER 2, 1961, AND FEBRUARY 19, 1962, IN WHICH WE HELD THAT THE GOVERNMENT IS LIABLE ONLY FOR THE DIFFERENCE BETWEEN THE TOTAL AMOUNT OF THE COST OF MEDICAL TREATMENT FURNISHED AND THE AMOUNT PAID UNDER MEDICAL INSURANCE CONTRACTS. THE EFFECT OF THOSE DECISIONS IS THAT AS TO THE FIXED EXPENSES INCURRED FOR MEDICAL AND HOSPITAL TREATMENT THE GOVERNMENT IS ONLY OBLIGATED TO PAY THE AMOUNT OVER AND ABOVE THE SUM ALLOWED FOR SUCH EXPENSES BY THE INSURANCE COMPANY.

IT IS NOTED THAT IN AN OPINION DATED OCTOBER 27, 1965, THE JUDGE ADVOCATE GENERAL OF THE NAVY CONCLUDED THAT THE GOVERNMENT HAS NO RIGHT OF RECOUPMENT IN THIS CASE AND HE RECOMMENDED THAT THE REMAINING MEDICAL BILLS BE PAID. HIS REASONING IS BASED ON THE VIEW THAT THE RULE ENUNCIATED IN THE ABOVE-CITED DECISIONS OF THIS OFFICE IS APPLICABLE ONLY IN THE EVENT OF UNJUST ENRICHMENT AND THAT A DETERMINATION OF SUCH ENRICHMENT COULD BE REACHED HERE ONLY BY SPECULATION AND WOULD BE DIFFICULT TO SUPPORT FOR THE REASON THAT THE SETTLEMENT WITH THE NEGLIGENT THIRD PARTY IN THIS CASE MUST BE TAKEN TO REPRESENT THE SUM OF MANY DIFFERENT AND ILLUSIVE FACTORS, ALL OF WHICH ARE IMPOSSIBLE TO TRANSLATE INTO DOLLARS AND CENTS. HOWEVER, THE ONLY ITEMS OF EXPENSE THAT ARE HERE INVOLVED ARE THOSE FOR MEDICAL AND HOSPITAL SERVICES, ALL OF WHICH APPEAR TO HAVE BEEN INCURRED BEFORE THE SETTLEMENT WITH THE THIRD PARTY TORTFEASOR. WHILE IT MAY BE THAT SOME ITEMS OF EXPENSE CLAIMED TO HAVE RESULTED FROM AN ACCIDENT MAY BE QUESTIONABLE AND THEREFORE SUBJECT TO ADJUSTMENT WHEN THE ACTUAL SETTLEMENT IS AGREED UPON, IT MUST BE PRESUMED THAT SUCH FIXED BASIC EXPENSES AS HERE INVOLVED WERE INCLUDED IN THE SETTLEMENT OF $200,000 AND THAT BOTH PARTIES VIEWED THAT SETTLEMENT AS INCLUDING PAYMENT IN FULL OF THOSE EXPENSES.

WE DO NOT BELIEVE THAT IN ENACTING LAWS PROVIDING MEDICAL CARE AND EXPENSES FOR DEPENDENTS OF MEMBERS OF THE UNIFORMED SERVICES CONGRESS INTENDED THAT PUBLIC FUNDS SHOULD BE USED TO PAY FOR MEDICAL CARE WHERE FUNDS FOR THE PAYMENT OF SUCH MEDICAL EXPENSES ARE FURNISHED BY A THIRD PARTY SUCH AS AN INSURANCE CARRIER OR A NEGLIGENT THIRD PARTY. THE APPARENT PURPOSE OF THE LAW IS TO RELIEVE THE MEMBER CONCERNED FROM THE NECESSITY OF MEETING NECESSARY MEDICAL EXPENSES, NOT TO ENRICH HIM OR HIS DEPENDENTS AT GOVERNMENT EXPENSE.

ACCORDINGLY, NO FURTHER MEDICAL EXPENSES SHOULD BE PAID IN THIS CASE AND ADDITIONAL EFFORTS SHOULD BE MADE TO COLLECT THE AMOUNT OF $4,789.65.