Malpractice - Case Reviews, Q&A, whatever else!

[Rcola23]

Correct, if your Carrier agrees that your defense is "solid" and willing to go to trial they will cover for whatever the outcome. The problem arises is if you believe your case is "solid" but the carrier can settle for $100K. The carrier will push hard to settle the case and may even threaten to not cover any of the losses beyond your policy limits.

The way the USA system works is even if you win at trial the case will cost the carrier $200K+ to defend. The Plaintiff doesn't pay a dime of these costs so the malpractice carrier eats it.

Blade - Be careful with this one. Certain medmal carriers and policies have the defense costs built within the liability limits; thus eroding one's liability limits. A policy needs to specifically state that legal defense costs are covered outside of the liability limits.

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[Rcola23]

Got it. One more question: is it true that the plaintiff attorneys will always or almost always accept a “reasonable” settlement within policy limits? In other words, are all cases “settleable” if the defendant agrees they are at fault?

Yes, that is the way our system works. If you make an offer to settle for the MAX like $1 million (limits of your policy) the lawyers will accept 99% of the time. This isn't about justice or fairness it's about money. I have never heard of one case where the defendant offered up the limits of his/her policy and the plaintiff's lawyer rejected the offer. Now, I'm sure there are cases where the malpractice is so so bad the families will demand more or a trial but the lawyers are typically thrilled to get the maximum from your policy. They then try to use you against other defendants (like the surgeon for example) to get him/her to settle as well.

A plaintiff's attorney does not have the ability to accept or decline a settlement offer - barring some extenuating POA circumstances. The attorney may advise and guide their clients; however, the plaintiff, which is the attorney's client, must ultimately agree to a settlement.

To your point of the defendant agreeing they are at fault... If the defense is willing to offer a settlement, they may or may not offer an admittance of fault. That being said, I have known of cases where a plaintiff declined to settle because the defendant will not admit any wrongdoing and would not accept any settlements without it.

Medmal lawsuits typically drag on for quite some time and they take an emotional toll on all parties involved. It is not uncommon for the settlement to diverge from what the initial suit was for. I have seen a case where a widow settled for an apology from the Doctor and a memorial bench with the patient's name on it at the hospital.

Insurance data has shown that many patients do not initially have a desire to turn to monetary compensation for an undesired outcome, but they feel that bringing a claim is their only way to justice when there has been a lack of communication and/or apology after an event.

 

[Rcola23]

I’m in Virginia now: Malpractice cap of 2.2mil. So it always seemed strange that we wouldn’t have coverage of 2.2 mil instead of 1 million. But understanding the settlement process helps explain why you would not want that higher coverage. Just become a bigger target.

Virginia has some of the highest medmal limits in the country. The limits are currently at $2.35 million as of 1 July 2018 and are set to increase by $50,000 per year until 1 July 2031 when the cap will be $3 million. The general idea among defense attorneys would be that higher limits often equals bigger targets, but you also want to make sure you have adequate coverage. My guess would be that although you are at $1 million of coverage per occurrence on the individual policy, there would be an adequate excess liability policy to address anything over.

 

[caligas]

Virginia has some of the highest medmal limits in the country. The limits are currently at $2.35 million as of 1 July 2018 and are set to increase by $50,000 per year until 1 July 2031 when the cap will be $3 million. The general idea among defense attorneys would be that higher limits often equals bigger targets, but you also want to make sure you have adequate coverage. My guess would be that although you are at $1 million of coverage per occurrence on the individual policy, there would be an adequate excess liability policy to address anything over.

I am not familiar with adequate excess liability policy, is that very common?

 

[Rcola23]

I am not familiar with adequate excess liability policy, is that very common?

An excess liability policy, commonly called an umbrella policy, would absorb those costs that exceed the individual policy.

For example:

Let's say I have an individual $1m/$3m med mal policy (probably the most common limits) and a practice I am at carries a $3m excess liability policy. Let's also say I live in a state that has a high med mal cap limit - we'll just use Virginia for this example; which has a cap of $2.35 million currently.

I end up in court and the jury awards the state cap to the plaintiff of $2.35 million. The first number on my individual policy represents the maximum amount of coverage I will have from that policy per claim. So, my individual policy would pay the first $1 million of the $2.35 million judgement. After that, the excess liability policy, which has a cap of $3 million, would be activated and cover the remaining $1.35 million.

I hope that helps.

 

[caligas]

An excess liability policy, commonly called an umbrella policy, would absorb those costs that exceed the individual policy.

For example:

Let's say I have an individual $1m/$3m med mal policy (probably the most common limits) and a practice I am at carries a $3m excess liability policy. Let's also say I live in a state that has a high med mal cap limit - we'll just use Virginia for this example; which has a cap of $2.35 million currently.

I end up in court and the jury awards the state cap to the plaintiff of $2.35 million. The first number on my individual policy represents the maximum amount of coverage I will have from that policy per claim. So, my individual policy would pay the first $1 million of the $2.35 million judgement. After that, the excess liability policy, which has a cap of $3 million, would be activated and cover the remaining $1.35 million.

I hope that helps.

So why don’t plaintiffs attorneys go after the cap on the umbrella, why do they settle for the standard $1mil malpractice limit when their is more meat on the bone with the umbrella/excess policy?

 

[Rcola23]

So why don’t plaintiffs attorneys go after the cap on the umbrella, why do they settle for the standard $1mil malpractice limit when their is more meat on the bone with the umbrella/excess policy?

Most of it comes down to leaving everything up to the emotions of a jury or not. It is a gamble when you decide to go for the jury verdict; which is the only way you will likely get the full cap. Both of the attorneys are constantly trying to guess how the case is progressing and who is "winning" so far. When one side begins to have a clear advantage, that is when settlement offers typically become stronger.

I have seen cases that should have 100% gone to the plaintiff on all accounts, yet the jury deemed no fault. You just never know.