Medical Malpractice Damage Cap Increase Explained
There has been an increase in the medical malpractice damage cap. Dr. King from Sweeney Law Firm explains what this means for medical malpractice cases in an interview with INsight.
Q Welcome back to INsight. We’re here at the Sweeney Law Firm studio and we have Dr. King to give us more information about what happened, effective July 1, 2017 in the state of Indiana. They changed some of the things for victims of medical malpractice.
A Yes, finally. After fifteen years of not changing the cap, the cap is going to go up. Now, this is effective for cases that accrue past July 1st of 2017 and what we mean by that is, essentially, if the malpractice occurred after July 1, 2017, then the cap on damages has actually gone up as of July 1st.
Q So, it’s important why, because there’s, I’m sure there’s, people’s first gut instinct is, well, why does the cap need to go up?
A Well, it’s become very clear that, well, first of all, there’s the cost of living increase, there’s inflation, but then it’s also become pretty clear. We have some clients that have medical bills that are in the several hundreds of thousands of dollars, even close to a million dollars, and if they have medical bills that are that high and the cap limits the amount that they can recover, they might not be able to recover anything for themselves after paying back the insurance liens.
Q See, there’s news to me. I would have assumed that part of, you know, if somebody messes up, you know, if you win a victory in medical malpractice and I still have the long list of bills, it should at least cover that, you know, and then some.
A It covers the bills that you might have and the insurance, what the insurance has paid and then what’s left over, then, potentially goes to the client, but because the cost of medicine is increasing, the cap on damages needs to increase.
Q Okay. So, and they’ve changed some other things, too. There used to be, how did this four stage, what’s all that?
A So, the way that the fund pays out, in Indiana there’s two different types of payout. The doctor, themselves, have an insurance policy that pays out a small portion under the cap, which the current cap before July 1st is 1.25 million dollars. It’s going up to 1.65 million dollars, is the total amount that can be paid out for medical malpractice. The doctor, the doctor’s insurance company only has to pay out a very small portion of that. The rest of it gets paid out by the Indiana Department of Insurance. There’s a fund that doctors pay into called a Patient Compensation Fund and they are the ones that pay out the bulk. Now, they have typically only paid out, it used to be only twice per year. Just recently they moved to a quarterly payment system, so they pay four times a year, but now, moving forward, after July 1st, they will pay out within, they need to pay out within sixty days of a settlement or a judgment.
Q So, that was, it was always one payment? It’s not like the lottery, where I get paid in quarterly payments. I got paid one payment, but just on these certain dates.
A Correct, correct. And often we would have, our clients would be waiting, even after learning that a settlement has occurred, they could wait another three months before they see a penny. But now, under the new law, the longest they will have to wait is sixty days.
Q How unusual is, was Indiana with that lower cap?
A So, what we have in Indiana is a hard cap, meaning even if you have medical bills greater than 1.25 million under the current cap, you can’t get a penny more. Most states actually have a cap on non, what we call non-pecuniary damages, which are the non-financial damages. In other words, in most states, if you have 2 million dollars in medical bills, you can get 2 million plus a certain amount. In Indiana, that’s not the case. It is a hard cap and there are very few states like that in the United States.
Q It doesn’t seem right. It just, in that explanation of it.
A We don’t believe it’s right. The plaintiffs firms would like to see that change, but that’s, even under the new laws, which are good because the caps are going up, they still stuck with the hard cap.
Q All right. Well, it’s a lot of things to learn in four minutes and it’s a much better time to connect yourself with Sweeney Law Firm and get that initial consultation for free. You can find out more at Sweeneylawfirm.com and we will be right back on INsight.