What Determines Compensation in a Medical Malpractice Suit?

Everyone hopes they never have to ask this question, but if you are the unfortunate victim of medical negligence, you may find yourself asking, “What compensation am I entitled to?”

In the year 2012, for instance, a total of $3.5 billion was paid out in about 12,000 lawsuits in the United States. One of the highest payouts that year was $74.5 million awarded to plaintiff Jennifer Blunt in California after her daughter was left with cerebral palsy due to serious injuries sustained at the time of birth. This included $53 million for future medical expenses, $10 million for lost earnings, $7.5 million and $225,000 for future and past non-economic damages to the baby, and $3.8 million for non-economic damages to the parents. How were these awards determined? What determines the compensation in a medical malpractice suit?

Medical Malpractice Damages

When determining the amount payable as damages, the legal system attempts to answer the question, “What has the victim lost?” Broadly speaking, medical malpractice awards are divided into three categories:

  1. Non-economic damages that cannot be precisely calculated:
    • Pain and suffering of the victim
    • Loss of consortium by the victim’s family
  2. Economic damages that can be precisely calculated:
    • Cost of past and future medical treatment
    • Reimbursement for future loss of income or earning potential
  3. Exemplary or punitive damages to punish the doctor (rather than compensate the victim) for conduct that was blatantly egregious

Cost of Past and Future Medical Treatment

Medical negligence often results in devastating and catastrophic injuries, leaving the victim facing a lifetime of medical care and expenses. A medical economist specialist calculates the anticipated future medical expenses and presents them to the jury. When serious injuries have taken place, this figure is often in millions of dollars.

Reimbursement for Future Loss of Income or Earning Potential

Calculating this economic damage can be complicated. The jury must decide on the amount of earnings (past, present, and future) the victim will lose because of the injury. An expert economist determines the “present value,” a complex financial concept that determines a person’s future earnings. This economist appears as an expert witness during the trial and explains to the jury why a certain amount of compensation is necessary to cover the victim’s lost earnings.

Calculating lost earnings and lost earning capacity are further complicated when the victim is unemployed at the time of the injury or had plans to move to a better paying job in the near future. For instance, if a person is unemployed, there is no previous salary to serve as an indicator of earning capacity. The defense attorney will argue that there is no claim for lost earnings. Retired people cannot make a claim for lost income. On the other hand, if a victim can prove that he or she was hired for a better paying job prior to the injury, this can help augment the award.

It is easier to calculate damages for salaried individuals compared to victims who are self-employed. In self-employed individuals, tax returns are usually relied upon. If the victim had under-the-table business dealings, lost earnings are very difficult to establish.

Pain and Suffering of the Victim and the Victim’s Family

It is even more difficult to estimate non-economic damages such as a victim’s pain and suffering. But, the mental anguish, physical pain, embarrassment or humiliation, loss of enjoyment of life, and emotional distress of the victim must be compensated.

A multiplier may be used by insurance companies to calculate these damages, where some portion of the economic damages is deemed to adequately represent the non-economic damages. But juries tend to determine pain and suffering based more on emotional factors. If the plaintiff is a good witness who appears honest and is liked by the jury, non-economic compensation is likely to be higher. If the plaintiff has a criminal record or appears dishonest during the trial, compensation may be lower or denied altogether. Pain and suffering awards for deceased victims are typically lower than victims who are alive and enduring hardship.  However, if the victim dies, his or her estate may be entitled to bring a wrongful death claim.  The elements of a wrongful death claim vary by state.

The loss of consortium by a victim’s family must also be compensated. This is a claim for loss of intangible benefits by a spouse, parent, sibling, or child. Loss of consortium is based on the principle that an injured person cannot provide family members with the same love, affection, comfort, or companionship that they could prior to the injury.

Image via flickr by David

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