Background
In personal injury litigation, a recurring dispute involves the gap between the amount a medical provider bills for services and the amount actually paid after insurance adjustments, write-offs, and negotiated reductions. Plaintiffs have traditionally sought to introduce the full billed amount as evidence of the reasonable value of medical services received, even when a substantially lower amount was actually paid by or on behalf of the plaintiff. Defendants have argued that permitting evidence of inflated, never-collected charges misleads juries about the actual economic harm.
The Arkansas Supreme Court’s Committee on Civil Practice proposed a new Rule 412 of the Arkansas Rules of Evidence to address this issue directly. After a public comment period that began with the Court’s earlier per curiam order in In re Creation of Rule 412 of the Ark. Rules of Evid., 2026 Ark. 18, the Court adopted the new rule in this per curiam, effective immediately.
Rule 412 joins a growing body of state evidentiary rules nationwide that address the admissibility of medical costs in light of the collateral source rule and the modern reality of negotiated medical billing.
The Court’s Holding
The newly adopted Arkansas Rule of Evidence 412, titled “Past necessary medical care, treatment, or services,” provides that evidence of medical costs “is not admissible to prove the reasonable value of past necessary medical care, treatment, or services received unless those costs were actually paid by or on behalf of the plaintiff or the costs remain unpaid, and the plaintiff or any third party is legally responsible to pay them.”
The rule defines “plaintiff” as “the person who received the past necessary medical care, treatment, or services for which damages are sought.” The Reporter’s Note clarifies the rule’s intended effect: “The actual medical costs that are required to be paid, or which have been paid, remain relevant evidence. Evidence of medical costs that a provider or insurance carrier has agreed not to collect is inadmissible.”
In practical terms, this means a plaintiff may no longer introduce the full billed amount of medical charges when those charges have been reduced through insurance adjustments, contractual write-offs, or other negotiated reductions. Only the amounts actually paid—or amounts that remain legally owed—are admissible to prove the reasonable value of medical care.
Key Takeaways
- Plaintiffs can no longer introduce inflated or “phantom” medical bills as evidence of damages—only amounts actually paid or legally owed are admissible under the new rule.
- The rule effectively eliminates the practice of using the full billed amount to establish the reasonable value of medical services when a lower amount was paid through insurance or negotiated reductions.
- Defense counsel now have an evidentiary basis to exclude write-offs and adjustments from the damages calculus at the admissibility stage rather than fighting about them at trial.
- The rule applies only to past necessary medical care—it does not address future medical expenses.
Why It Matters
Rule 412 is one of the most consequential changes to Arkansas personal injury practice in recent years. For plaintiffs’ attorneys, the rule changes the damages landscape in cases involving significant medical treatment. Where plaintiffs previously could argue that the full billed amount represented the reasonable value of services rendered—regardless of what was actually paid—they must now anchor their medical damages to amounts that were paid or remain legally owed. This could significantly reduce the medical-damages component of personal injury verdicts in cases where insurance adjustments or contractual write-offs substantially reduced the amount paid.
For defense counsel and insurers, Rule 412 provides a clear evidentiary tool to prevent juries from seeing inflated billing figures that bear no relationship to the economic reality of the plaintiff’s medical expenses. The rule should also simplify damages presentations by focusing the inquiry on verifiable paid amounts rather than disputed billing calculations. Practitioners on both sides should update their discovery practices and trial strategies to account for this new evidentiary framework.