How Are Malpractice Settlements Calculated?

How Are Malpractice Settlements Calculated?

When your life has been turned upside down by medical malpractice and your lawyer believes you have a case, you will want to know, “how will my medical malpractice settlement be calculated?”  In other words, how will you know what is a fair amount of money to settle your medical malpractice lawsuit?  The lawyers of Lupetin & Unatin have helped countless victims of medical negligence get back on their feet by recovering life-changing settlements.  To solve our client’s problem and ensure they receive a fair settlement we explore numerous questions that guide us to the right answer.

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While there are similarities amongst medical malpractice lawsuits, every case is unique and different. Your case is different.  The facts of the case, including the type of medical negligence, the medical causation questions, and the extent to which the specific injury impacts you or your loved one’s life are different in each case. But there are specific issues and questions we as malpractice lawyers ask, investigate, and answer in every case to help us determine what a fair amount of money is to demand and accept on behalf of our clients.

We have written elsewhere about what damages are available for medical malpractice, but in general damages that may be sought by plaintiff injured due to medical malpractice include:

  1. past and future medical expenses
  2. past and future lost earnings or earning capacity
  3. physical pain and emotional distress
  4. embarrassment and humiliation;
  5. loss of ability to enjoy the pleasures of life, and
  6. disfigurement

The analysis for what your medical malpractice case may settle for does not stop there.

Deep consideration of the following questions will help us (and you) calculate what your case may be worth and determine “what is a fair medical malpractice settlement?”

By taking time to think through the following questions about your case you will better understand how to calculate a reasonable settlement for your case, the rationale for your lawyer’s recommendations, and how you can ensure you receive the best settlement possible.

How clear cut is the negligence?

The first question we ask is how clear-cut or debatable is the medical negligence in the case? The settlement calculation is simplified if the medical mistake is indefensible where everyone would agree the doctor, nurse, or hospital was negligent.  When the fault of the defendant is admitted (e.g. there is an admission in the medical record or an apology letter) this removes a variable from the settlement calculation.

On the other hand, if the defendant can make a good faith argument that they were not negligent or their mistake was understandable or excusable under the circumstances the settlement equation changes.  A legitimate liability defense is an important variable that you must consider because the better the defense the worse your chances are of a jury finding in your favor at trial.

Another way to think of this is by imagining that you take your malpractice lawsuit to trial by jury.  Ask yourself (with input from your lawyer) “what percentage of the time would a jury find the defendant was negligent?”  “Was the doctor or hospital negligent?” is the first question the jury must decide.

If you can estimate that 25% of the time the case was taken to trial, a jury would find no fault on the part of the defendant, then you should reduce the value of your claim by 25%.  Thus, if your case is worth $1 million on its best day but your chance of winning fault against the defendants is 75%, then the settlement value of your case is $750,000.

Unless the defendant has admitted fault or negligence before trial then we believe you should account for some chance the jury will find no fault of the defendant.  In our experience, a good, conservative rule of thumb is to factor in a 10% chance the jury will find for the doctor when thinking about the settlement value of your case.

Why do we do this?  Because there are people in your community who could wind up on your jury who have such strong beliefs and biases against medical malpractice lawsuits that no amount of evidence could ever convince them to find against a doctor or hospital.  The fact is, no matter how strong your case, there are people who could never find in your favor no matter what happened to you or your loved one.

How clear cut is the medical causation?

Similarly, the degree to which you, your medical malpractice lawyer, and medical experts can prove that the medical negligence at issue was a primary cause of the injuries in question, directly impacts the value of the claim.

The second question the jury of your medical malpractice lawsuit will be asked is “was the Defendant’s negligence, a factual cause in bringing about harm to the plaintiff?” The jury is told the negligent act is a factual cause of harm when the harm would not have occurred absent the conduct. The jury is told that to be a factual cause, the conduct must have been an actual, real factor in causing the harm, even if the result is unusual or unexpected.

Medical causation is often the most hotly contested part of a medical malpractice trial and where most cases are lost.  There are many reasons why juries struggle to connect the medical negligence to the plaintiff’s injuries.

A good example often arises in cancer misdiagnosis lawsuits.  Let us say the plaintiff was a long-time smoker, developed a treatable, early-stage lung cancer, but due to a radiologist’s failure to timely diagnose the cancer, the patient develops metastatic disease which significantly decreases their chance of survival.  When asked to consider the primary cause of the patient’s poor outcome, many jurors focus on the patient’s decision to smoke and the risks they knowingly accepted by doing so.  Juries have been known, in such cases, to conclude that while the doctor was negligent, that error was not a substantial factor in causing the patient’s poor outcome when compared to the smoking that caused the patient to develop cancer.

You can imagine this medical causation issue in about any medical malpractice case because the medical care in question is almost always sought due to a pre-existing medical condition.  Savvy defense lawyers try and focus the jury’s attention on the underlying medical condition as the actual cause of the plaintiff’s injuries and not the negligent actions of the defendant doctors, nurse, or hospital.

If the defense can raise a convincing argument that the medical negligence was not a substantial factor in causing the alleged injury, you and your lawyer must factor this important variable into the calculation of a fair and reasonable settlement.

Again, if your case went to trial and 35% of the time the jury found that the mistake in question was not the cause of the claimed injuries then you must reduce the value of your settlement by 35%.  If there are strong defenses to your allegations of medical causation and negligence you must factor both percentages into your settlement equation.

Was the plaintiff at fault or did they contribute to their injuries?

Some medical malpractice lawsuits involve negligent actions by the patient.  This is called comparative or contributory negligence.  If the defense offers sufficient evidence at trial that the patient or patient’s family was negligent and contributed to the poor outcome, the jury will be asked to assess the amount of contributing fault by the plaintiff.

For example, imagine a scenario where a patient failed to get a certain test that would have led to the early diagnosis of a medical condition.  Now imagine that the doctor documented that they told the patient about this important test but failed to order the test.  Because of not getting the test, the patient’s medical condition progresses to a much worse point than had it been diagnosed and treated earlier.  In defense of the poor outcome, the doctor may blame the patient for failing to follow up on the test they were told to get.  The jury will be asked to apportion fault (blame) between the doctor and patient.  If any percentage of fault is assessed to the plaintiff, their verdict will be reduced by the assigned percentage.

Just like the analyses above, if there is any contributory negligence in the case, this must be factored into how you calculate your medical malpractice settlement.  If the jury finds the plaintiff 10% at fault for the outcome, the settlement value should be reduced accordingly by 10%.

You must also keep in mind that in Pennsylvania if the jury finds the plaintiff 51% or more at fault, then they cannot recover any money.  51% or more fault by the plaintiff is a complete bar to recovery.

How old is the plaintiff and what is their life expectancy?

Because the law in Pennsylvania accounts for future injuries and damages, the age of the injured person in a medical malpractice lawsuit has a significant impact on the settlement value of the case. As we get older, our life expectancy decreases which results in a shorter period of future economic and non-economic damages that can be recovered.

When an injured person makes a claim for future damages and there is medical testimony that the plaintiff will experience such injuries for the rest of their life, the court looks to life tables published by the government to estimate the plaintiff’s life expectancy. If the case goes to trial, the jury is instructed by the court to consider the Plaintiff’s life expectancy when considering the value of future economic and non-economic damages.

Resultantly, if we imagine two patients, one 20 years old and the other 80, both of whom will suffer the same injuries for the remainder of their lives, the settlement value for the 20-year-old’s claim is much larger than that of the older plaintiff.  Let us assume the jury decides that each future year of the plaintiff’s injuries is worth $50,000.  If the life expectancy of the 20-year-old is 60 years, then the value of their future injuries is $3 million.  On the other hand, if the 80-year-old’s life expectancy is seven years, the value of their future injuries is only $350,000.

As a rule of thumb, younger plaintiffs with longer life expectancies will have greater settlement values for their malpractice claims when compared to older individuals.  Because of this, life expectancy and future damages are a significant variable that impact the value of your medical malpractice lawsuit settlement.

Does the medical malpractice involve Wrongful Death and Survival claims?

Whether the medical malpractice claim involves a living person versus a deceased person will impact the settlement calculation because there are different damages recoverable in wrongful death versus when the injured person is still alive.

We have written about how the wrongful death and survival action process works for damages in Pennsylvania. When a person’s death was due to negligence, the law allows a claim for damages by the deceased person’s estate and a separate claim for the surviving beneficiaries which is typically the next of kin.

In wrongful death cases, there are no future medical costs associated with such claims. However, depending on the relationship of the deceased person to the surviving heirs, the loss experienced by family members can be quite significant. Because of the difference between recoverable money damages in death cases versus malpractice lawsuits where the plaintiff is still living, the settlement calculation differs between these claims.

In a wrongful death malpractice claim, we must consider different variables like:

  1. Is there a surviving spouse or children?
  2. How close was the deceased person with their family?
  3. Did the deceased person provide money to their heirs?
  4. Did the deceased person provide love, tutelage, and companionship to their surviving spouse or children?
  5. Did the deceased person provide services around the house and to the family beyond employment income?

A wrongful death medical malpractice claim is calculated differently than a claim involving a living plaintiff.  Because of this, you must factor this important variable into your settlement calculation.

Is the injury temporary or permanent?

Another significant factor you must consider when assessing the settlement value of a medical malpractice claim is whether the plaintiff’s injuries are temporary or permanent.

This is because at a medical malpractice trial, the jury is instructed that the amount of money they award to the injured plaintiff must compensate completely for damages sustained from the time of the harm up to the date of verdict, as well as all the damages the plaintiff will sustain in the future.

Sometimes the plaintiff is seriously injured but makes a full recovery.   In other instances, patients suffer injuries from which they never fully recover.

Because the Pennsylvania medical malpractice laws account for pain suffering, disfigurement, mental anguish, loss of the enjoyment of life, and inconvenience for the entire period that the injured person will experience their deficits both past and future, permanent injuries result in greater settlement values than do those claims where the injury is temporary or limited.

Whether your injury involves a limited or permanent injury will play a major role in the value of your settlement because the law allows for recovery of both past and future claims for pain and suffering, medical care, and income loss.

Is there past or future income loss?

If your injuries prevent you from working or limit how much you will be able to earn in the future, then you can make a claim for money damages to recoup your earnings losses.  The law in Pennsylvania allows patients injured by malpractice to recover money for lost income from the time of their injury until the date of settlement or jury verdict.  The law also allows malpractice plaintiffs to claim money damages for all income they will lose in the future for the remainder of their work life expectancy.   How much you have lost in the way of income and future earnings plays a significant role in the settlement calculation and settlement value of your malpractice claim.

Past lost earnings claims are a straightforward calculation. The injured person simply testifies about what they were making, provides proof through tax returns and pay stubs, and a doctor testifies that because of their injuries they were not able to work during that period.

Future lost earnings claims, however, require testimony to project the amount of money and benefits allowed under the law that can be claimed.  While the law does not require expert testimony, experts are often needed to weigh in on the impact of fringe benefits, work life expectancy, personal maintenance, and the impacts of inflation when calculating the future economic losses.

Is there past or future medical care and bills?

Similarly, another important variable in medical malpractice lawsuit settlements is whether there are medical bills that must be repair or out of pocket expenditures by the plaintiff. Additionally, whether the injured person will require medical care in the future is an important consideration.

Past medical costs are the medical expenses the plaintiff incurred from the time of the injury up to the date of settlement of jury verdict for the diagnosis and treatment of their injuries.

Similarly, future medical expenses are all medical expenses that the plaintiff will incur in the future for the diagnosis and treatment of their injuries.

To recover medical expenses, you must prove that the medical care was reasonably required and that the amount of the expenses was reasonable.  This typically involves testimony from a medical expert.

When the injured person requires extensive medical care, treatment, and accommodations in the future it is wise to obtain a life care plan.  A life care plan is a detailed report of a person’s future financial needs and expenses following a medical malpractice injury. The report takes the person’s entire circumstances into account, including medical costs, nursing care, and the costs of daily living.

In order to create and calculate a life care plan, we consult with a doctor and a certified life care planner.  The doctor provides an opinion about the future care that will be needed.  The life care planner figures out how much that care will cost.

Life care plans can be some of the most significant form of damages and personal injury and medical malpractice lawsuits. If you have suffered a catastrophic injury that requires extensive medical care in the future you need to make sure that your attorneys are familiar with how to create a life care plan to account for all of the future medical care costs.

How significant are the “noneconomic” pain and suffering damages?

Another significant factor in how much a medical practice claim may settle for is the extent of the plaintiff’s noneconomic damages. The greater the harm, the greater the value of the claim. Juries are tasked with assigning an amount of money to an injury that fairly and reasonably makes up for what was taken from the plaintiff.

Obviously, the more the plaintiff has lost and the worse their pain, suffering, inconvenience, and ability to enjoy life, the greater the settlement value.  As a rule of thumb, the more the plaintiff’s injuries interfere with their ability to live their life as they used to, the greater the perceived harm there will be by a jury and thus the greater the settlement value of the claim. It is of utmost importance to explore and explain in detail all the ways in which your injury interferes with your ability live your life like you did before the malpractice.  The greater the interference the greater the value of the case.

Where did the medical malpractice take place? 

The location where the malpractice occurred is important.  The simple truth is that not all jurisdictions are the same.  Counties with more people who, on average, make more money are more likely to award greater damage verdicts.

This is because a juror’s specific appreciation of money will impact how they view what is fair to compensate someone for their injuries.  $1 million is viewed differently by someone who makes $30,000 per year versus someone who makes $500,000.

Additionally, the belief systems of an average jury in a rural county will differ from the beliefs, morally and politically, of a jury made up of people from an urban venue.

Another factor that will impact the value of your verdict and thus your settlement amount is the extent to which medical care is available in the given jurisdiction.  In rural counties, the options for medical may be limited.  This can impact how people from that jurisdiction view the claims of a medical malpractice lawsuit.

First, such jurors may worry that a medical malpractice verdict will cause the hospital or doctor to leave the area, which threatens their wellbeing in the future.  Such jurors are less likely to find in the plaintiff’s favor.

Second, rural jurors may discount or “give a pass” to the defendant medical professionals because they believe the level of medical care in a rural area cannot be expected to be as good as medical care in more populated counties.

The defense lawyers and insurance companies for doctors and hospitals are aware of the impact jurisdiction has on the value of a claim.  The defense will offer less money to settle the same case in a rural county then they will for a case in an urban jurisdiction.

In short, the county in which the malpractice occurred will impact the value of your medical malpractice lawsuit.

How experienced and capable are your medical malpractice lawyers?

A final factor that will impact the settlement value of your malpractice lawsuit is the law firm and lawyer you choose.  Better, more experienced medical malpractice lawyers will obtain better settlements and verdicts for their clients.  This is true for several reasons.

First, the better your malpractice lawyer, the better they will investigate and workup your lawsuit.  A better investigation will lead to better facts and evidence, which always translates to a better settlement or verdict outcome.

Second, an experienced medical malpractice lawyer will have a much better sense of the true value of your case.  They will have resolved many lawsuits in the past and they will keep current on settlement values across the state – both of which provides deeper knowledge of a fair settlement in your case.  By having a seasoned malpractice lawyer on your side, you will avoid settling your case on the cheap.  Novice malpractice lawyers may settle your claim for too little because they did not know any better.

Third, an experienced medical malpractice lawyer will better understand the medicine which means they will more thoroughly know how to work up both the liability and unique damages of your case compared to a lawyer with little experience handling such case.

Fourth, a veteran malpractice lawyer knows the ins and outs of the medical malpractice law.  The law of medical malpractice in Pennsylvania is vastly different from any other area of personal injury law.  In fact there is an entire statute, the MCARE Act, that controls medical malpractice lawsuits in the Commonwealth of Pennsylvania.  There is also extensive medical malpractice case law which will impact the outcome of your case.  If your lawyer is not deeply familiar with the law, they will make mistakes that will result in a worse outcome for you.

Fifth, and most importantly, the better your medical malpractice lawyer, the greater the perceived risk by the defense.  If the defense knows you have an inexperienced lawyer, they will offer you less money.  This is because they know the lawyer will not work the case up properly or try the case effectively to a jury.

On the other hand, if the defense knows you have a talented and experienced medical malpractice lawyer on your side, they know they are at greater risk of losing at trial and for more money.  On average, defendant hospitals and insurance companies will offer you more money when you have a better lawyer.

What does it all mean?

As you can see, there are many factors that determine the settlement value of your medical malpractice claim.  We wish there were a magic calculator you could use that would tell you the precise settlement value of your claim.  There is not.

Instead, you and your lawyer must weigh all the factors discussed in this article along with your hopes and goals to reach a settlement range that feels fair.  Unfortunately, no amount of money will undue what happened and make things as they once were.  Truthfully, there is no “perfect” settlement or amount of money.  The point of a medical malpractice lawsuit is to reach the right resolution for you.

Achieving the best settlement for you or your loved one starts by partnering with the best medical malpractice lawyer in Pittsburgh or Pennsylvania.  The law firm of Lupetin & Unatin has been helping victims of medical malpractice secure life-changing settlements and verdicts for decades.  We would be honored to help you achieve the right resolution to your medical malpractice claim.

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