State v. J. M. E.

483

Argued and submitted December 19, 2017, supplemental judgment vacated and

remanded September 18, 2019

In the Matter of J. M. E.,

a Youth.

STATE OF OREGON,

Respondent,

v.

J. M. E.,

Appellant.

Marion County Circuit Court

15JU07122; A162969

451 P3d 1018

Youth appeals a supplemental judgment ordering him to pay restitution after

causing physical injury to the victim. Youth argues that the juvenile court erred in

ordering restitution for a hospital bill in the absence of evidence that the bill was

reasonable. The state disagrees, arguing that the Crime Victim Compensation

Program (CVCP) payment of the medical bill in question is proof that the bill was

reasonable because the CVCP is under a statutory duty to pay only reasonable

expenses. Held: The juvenile court erred. Payment of medical bills in accordance

with the statutory and regulatory scheme governing the CVCP does not, in the

absence of other evidence, support the determination that those bills are reason-

able. Because, in this case, the state produced no other evidence as to the rea-

sonableness of the medical bill in question, the trial court erred in including that

portion of the victim’s medical expenses in the supplemental judgment.

Supplemental judgment vacated and remanded.

Heidi O. Strauch, Judge pro tempore.

George W. Kelly argued the cause and filed the brief for

appellant.

Sharia Mayfield, Assistant Attorney General, argued the

cause for respondent. On the brief were Ellen F. Rosenblum,

Attorney General, Benjamin Gutman, Solicitor General,

and Greg Rios, Assistant Attorney General.

Before DeHoog, Presiding Judge, and Egan, Chief Judge,

and Aoyagi, Judge.

DEHOOG, P. J.

Supplemental judgment vacated and remanded.

484 State v. J. M. E.

DEHOOG, P. J.

Youth appeals a supplemental judgment ordering

him to pay restitution, arguing that the juvenile court erred

in ordering restitution for a hospital bill in the absence of

evidence that the bill was reasonable. The state disagrees,

relying on the fact that the Crime Victim Compensation

Program (CVCP)—which is under a statutory duty to pay

only reasonable expenses—paid the medical bill in question

as proof that the bill was reasonable. We agree with youth

that, on this record, there is insufficient evidence to prove

the hospital bill’s reasonableness. The court, therefore, erred

in including that amount in the restitution award, and we,

therefore, vacate and remand the supplemental judgment.

The relevant facts are undisputed. The court found

that evidence established, beyond a reasonable doubt, that

youth committed acts which, had youth been an adult, would

have constituted fourth-degree assault. Specifically, youth

punched the victim in the nose, causing him physical injury.

After a hearing, the court ordered youth to pay $13,065.49

as restitution for the victim’s medical expenses. That award

was the sum of several different medical expenses that the

victim incurred. Youth, however, challenges only a portion of

that restitution award: $4,745.49 for treatment at Silverton

Hospital. CVCP paid that bill.

The state did not present any evidence at the resti-

tution hearing as to the reasonableness of the medical bill

incurred at Silverton Hospital.1 Instead, in closing, the state

argued:

“And I would also argue that Crime Victim’s Compen-

sation, just like insurance companies, are not going to pay

more than what they feel is necessary. It’s in their best

interest to only pay amounts that they deem reasonable.

And so they did not pay the full amount for the hospital bill;

however, the hospital bill is not asking for the difference in

that.

1

The state did present evidence as to the reasonableness of the other med-

ical bills incurred. For example, two witnesses from the billing departments of

two other treatment providers explained how their offices decide what charges to

impose based on standards in the medical community and why those charges are

reasonable.

Cite as 299 Or App 483 (2019) 485

“But although I didn’t have anyone to testify for Crime

Victim Compensation, I would argue that they would only

pay what they feel is reasonable from the information that

they’ve received.”

Youth disagreed with the state, focusing on the state’s con-

cession that it presented “no evidence of any kind” as to the

reasonableness of the Silverton Hospital bill. Ultimately,

the court agreed with the state, explaining:

“With regard to the Crime Victim’s Compensation, I do

find [the state’s] argument persuasive that the Crime

Victim’s Compensation Fund does have an incentive to pay

only reasonable expenses. There’s certainly no guarantee

they will ever get that back, although clearly today they’re

trying to do so. But even if I order restitution it may take

a very long time for that actually to come back. So realisti-

cally speaking, I think the charges accepted by the Crime

Victim’s Fund are reasonable.”

Youth appeals the resulting supplemental judgment.

On appeal, youth argues that the court erred

in imposing the $4,745.49 restitution for the treatment

at Silverton Hospital, because the state failed to produce

any evidence of the hospital bill’s reasonableness beyond

the bill itself. In response, the state argues that proof that

CVCP paid the bill “presumptively establishes” that bill’s

reasonableness.

We review orders of restitution for errors of law.

State v. McClelland, 278 Or App 138, 141, 372 P3d 614 (2016),

rev den, 360 Or 423 (2016). “We are bound by the trial court’s

factual findings if they are supported by any evidence in the

record[.]” State v. Pumphrey, 266 Or App 729, 730, 338 P3d

819 (2014), rev den, 357 Or 112 (2015).

Restitution and the process by which the state can

seek to recover it against a youth offender are governed by

statute. Specifically, ORS 419C.450(1)(a) provides, in rele-

vant part:

“It is the policy of the State of Oregon to encourage and

promote the payment of restitution and other obligations

by youth offenders as well as by adult offenders. * * * If the

court finds from the evidence presented that a victim suf-

fered injury, loss or damage, in addition to any other sanc-

tion it may impose, the court shall:

486 State v. J. M. E.

“(A) Include in the judgment a requirement that the

youth offender pay the victim restitution in a specific

amount that equals the full amount of the victim’s injury,

loss or damage as determined by the court[.]”

Although ORS 419C.450 does not define “resti-

tution,” ORS 419A.004(26)2 provides that, as used in the

Juvenile Code, “ ‘[r]estitution’ has the meaning given that

term in ORS 137.103.” In turn, under ORS 137.103(3), res-

titution is defined, in relevant part, as the “full, partial or

nominal payment of economic damages to a victim.”

We held in State v. E. V., 240 Or App 298, 246

P3d 78 (2010), rev den, 350 Or 130 (2011), that, by making

the Criminal Code’s definition of “restitution” part of the

Juvenile Code, the legislature had also incorporated “the

whole definition, including the statutory definitions of its

component parts.” In applying the Criminal Code definition

of “victim,” ORS 137.103(4), to the youth in that case, we

reasoned that,

“[t]o conclude otherwise would be inconsistent with the leg-

islature’s expressed intent that the term ‘restitution’ has

the same meaning in the criminal and juvenile codes—that

is, ‘restitution’ would mean payment of economic damages

to one group in the Criminal Code, and payment of eco-

nomic damages to a different group in the Juvenile Code.”

E. V., 240 Or App at 302. We reach the same conclusion

regarding another component of the statutory definition

of restitution—the term “economic damages.” Like “vic-

tim,” the term “economic damages” is a component part of

the statutory definition of “restitution.” Specifically, ORS

137.103(2) provides (with one exception not relevant here)

that the term “economic damages” has the same meaning

given that term in ORS 31.710. ORS 31.710(2)(a), in turn,

defines “economic damages,” in relevant part, as: “objec-

tively verifiable monetary losses including but not limited to

reasonable charges necessarily incurred for medical, hospi-

tal, nursing and rehabilitative services and other health care

services * * *.” (Emphasis added.) Applying that meaning of

economic damages and the cases construing that term to

2

At the time of youth’s adjudication, ORS 419A.004(26) was numbered ORS

419A.004(23), but it was otherwise identical. Because it has no bearing on the

merits of this case, we use that provision’s current numbering in this opinion.

Cite as 299 Or App 483 (2019) 487

youth’s case, we conclude that the juvenile court erred in

awarding restitution for the victim’s treatment at Silverton

Hospital.

As we have previously explained, “ ‘there are three

prerequisites to an order of restitution: (1) criminal activ-

ities, (2) economic damages, and (3) a causal relationship

between the two.’ ” McClelland, 278 Or App at 141 (quoting

Pumphrey, 266 Or App at 733). Further, for hospital or med-

ical expenses to qualify as recoverable economic damages,

the state must prove that the cost of such services was rea-

sonable. State v. Campbell, 296 Or App 22, 27, 438 P3d 448

(2019). In that regard, “submission of a hospital bill, with-

out more, is insufficient proof for recovery of ‘reasonable’

hospital or medical services. Some additional testimony or

evidence is required to support the reasonableness of the

bill for the hospital or medical services.” McClelland, 278 Or

App at 144. We have recently clarified, however, that “the

market rate is a reasonable amount for a victim to recover

for medical expenses.” Campbell, 296 Or App at 30. And, in

that case, we further concluded that the fact that a publicly

funded health insurer has paid a medical bill is “some indi-

cation of the charge’s reasonableness.” Id. at 31-32.

In Campbell, a witness testified that the amounts

that were paid by CareOregon—a publicly funded health

insurer—were at or below the usual and customary rate for

those services in that market. 296 Or App at 32. Based on

that testimony, we concluded that the record contained suffi-

cient evidence that the requested restitution to CareOregon

was reasonable. Id. After reaching that conclusion, however,

we went on to say that “[o]ur conclusion is required for the

added reason that the payments were made by a publicly

funded health insurer who, by design, can only make pay-

ments at reasonable rates.” Id. That is because of the applica-

ble statutory and regulatory scheme. See ORS 414.065(1)(a)

(requiring the Oregon Health Authority to set “[r]easonable

fees, charges, daily rates and global payments for meeting

the costs of providing health services to an applicant or

recipient” as well as “[r]easonable fees for professional med-

ical and dental services which may be based on usual and

customary fees in the locality for similar services” (empha-

ses added)).

488 State v. J. M. E.

At first blush, the state’s argument in the present

case may appear similar to the argument that we accepted

in Campbell. Like CareOregon, CVCP is subject to a statu-

tory and regulatory scheme. Specifically, CVCP is governed

by ORS 147.035(2)(a), which states that it may provide com-

pensation for “reasonable medical and hospital expenses.”

(Emphasis added.) See also OAR 137-076-0020(3) (defin-

ing “reasonable expenses” for purposes of ORS 147.035).3

Despite that superficial similarity, however, we for two rea-

sons are not convinced that the logic applied in Campbell is

appropriate in this case. First, the underlying statutory and

regulatory scheme was not the only evidence in Campbell

of the bill’s reasonableness. Rather, a witness testified that

the amounts that CareOregon paid were at or below the

usual and customary rate for those services in that mar-

ket. Campbell, 296 Or App at 32. In contrast, in the pres-

ent case, the state presented no evidence about the Silverton

Hospital bill beyond the bill itself. No witness testified that

the amount charged—or the amount subsequently paid by

CVCP—was at or below the market rate for those services,

nor was there any other evidence as to the reasonableness of

the medical bill.

Second, the statutory and regulatory scheme gov-

erning publicly funded health insurers is both more compre-

hensive and prescriptive than that which governs CVCP. As

Campbell explained:

“In [determining the usual and customary fees in the

locality for similar services], the Oregon Health Authority

must consult with the Medicaid Advisory Committee whose

members include, in part, a licensed physician, health

care providers, two members of health care consumer

groups that include Medicaid recipients, and two Medicaid

3

OAR 137-076-0020(3) specifically provides:

“For purposes of ORS 147.035, reasonable medical expenses shall be lim-

ited to ambulance expenses and expenses for necessary services provided

by a Medical Practitioner. Medical treatment provided by any other medical

provider may be reimbursable if at the time treatment began it was approved

by and provided under the supervision of a Medical Practitioner. Medical

treatment provided by any other medical provider without a referral from a

Medical Practitioner may be compensated for up to 5 visits within 90 days

from the date of the first crime-related visit by the victim, at the discretion

of the Department, if the medical provider is licensed in Oregon under the

provisions governing that provider’s profession.”

Cite as 299 Or App 483 (2019) 489

recipients. ORS 414.25; ORS 414.211. By legal mandate,

the state’s payment rates are intended to reflect the usual

and customary fees at or below the local market rate, tak-

ing into account what doctors, consumers, and other stake-

holders consider reasonable.

“[Further, f]ederal laws and regulations subject Oregon

payment rates to additional oversight.”

Campbell, 296 Or App at 32-23. After reviewing the statu-

tory and regulatory scheme that governs CVCP, ORS 147.035

(2)(a) and OAR 137-076-0020(3), we cannot conclude that it

is comparable to that which governs publicly funded health

insurers. The complex statutory and regulatory scheme in

Campbell is what compelled us to conclude that the amounts

paid by a publicly funded health insurer are indicative of

the reasonableness of that amount. And, although CVCP

appears to be under a statutory duty to provide compensa-

tion for only those medical bills that it deems “reasonable,”

there is simply not the same level of oversight or direc-

tion as to what that “reasonable” charge may be. That is,

in the publicly funded health insurer context, the Oregon

Health Authority must consult with the Medicaid Advisory

Committee to set rates that are at or below market value

while also conforming to federal statutes and regulations. In

the CVCP context, on the other hand, governing provisions

of law do not dictate how reasonable medical fees are to be

determined, who is to participate in that determination, or

what relationship, if any, they must bear to prevailing mar-

ket rates. Accordingly, there is simply no evidence here that

CVCP’s duty under ORS 147.035(2)(a) is comparable to that

imposed under the statutory and regulatory scheme that we

considered in Campbell.

Without any evidence as to the reasonableness of

the Silverton Hospital bill paid by CVCP or other persua-

sive argument regarding CVCP’s duty to pay only reason-

able medical bills, we conclude that the trial court erred in

including that portion of the victim’s medical expenses in

the supplemental judgment.

Supplemental judgment vacated and remanded.