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Taking the cap off: Med-mal damages cap facing challenges

Mike End, a lawyer in Milwaukee, says Wisconsin’s $750,000 cap on non-economic damages, as well as other restrictions on medical-malpractice lawsuits, has caused plaintiffs lawyers to become much more selective about the cases they bring to court. (Staff photo by Kevin Harnack)

Mike End, a lawyer in Milwaukee, says Wisconsin’s $750,000 cap on non-economic damages, as well as other restrictions on medical-malpractice lawsuits, has caused plaintiffs lawyers to become much more selective about the cases they bring to court. (Staff photo by Kevin Harnack)

A possible misdiagnose that led to a patient’s losing her limbs may prove to be the case that blows the cap off medical-malpractice lawsuits in Wisconsin.

Ascaris Mayo, a Milwaukee resident, ended up losing both of her arms and legs in 2011 after doctors initially failed to detect that the severe abdominal pain, rapid heartbeat and other symptoms she was suffering from were the results of a Strep A infection. Not long after the amputations, Mayo and her husband went to the Habush, Habush and Rottier law firm to seek representation in a lawsuit against Mayo’s doctors.

Mayo’s lawyer, Dan Rottier, said his firm has tried on many occasions over the years to challenge the state’s $750,000 cap on non-economic damages, which are those related to pain and suffering. Until now, those attempts have been short circuited by out-of-court settlements reached between plaintiffs and insurance companies.

“When they resolved, that issue would go away,” Rottier said.

Mayo’s case, in contrast, has already delivered the $750,000 cap a blow at the circuit-court level. When the lawsuit was in Milwaukee County Circuit Court in 2014, the jury handed down a $25.34 million verdict, $16.5 million of which consisted of non-economic damages. Even though the award exceeded the cap, the judge decided to let the entire amount stand.

Before appealing, Rottier said, the defendants went ahead and paid everything that was not in excess of the cap, leaving $15.75 million in dispute. That means the only matter still at issue is the validity of the cap itself.

A decision from the Court of Appeals is expected in the coming months.

The case could prove a turning point, some say, for medical-malpractice lawyers and clients, giving them a way around at least one of the state’s statutory limits on medical-malpractice lawsuits. Those restrictions, many plaintiffs attorneys argue, can prevent clients from getting justice while letting grossly negligent doctors continue to practice.

On the other hand, doctors and defense lawyers, many of whom are watching the Mayo case closely, are sticking up for the cap by contending that doctors who are not hemmed in by a fear of lawsuits are able to put their first priority on tending to the needs of patients.

Dan Rottier, a lawyer at Habush Habush and Rottier, has a pending case before the District I Court of Appeals that directly challenges the state’s $750,000 cap on non-economic damages. (Staff photo by Kevin Harnack)

Dan Rottier, a lawyer at Habush Habush and Rottier, has a pending case before the District I Court of Appeals that directly challenges the state’s $750,000 cap on non-economic damages. (Staff photo by Kevin Harnack)

Limiting practice

Since 1975, doctors in Wisconsin have been required to carry a type of insurance known as primary liability to cover awards stemming from medical-malpractice suits. For claims that go beyond what that insurance will cover, there is something known as the Injured Patients and Families Compensation Fund, which medical professionals are required to pay premiums into.

Because of the cap on non-economic damages, the insurance is often tapped for the larger sorts of claims that can result when a doctor is found liable for economic damages. Unlike non-economic damages, Wisconsin sets no limit on the amount of economic damages that can be awarded by a jury.

The cap on non-economic damages was first established in 1995 and set at $350,000. Subsequent years brought regular of “cost of living” adjustments, taking the top limit up to $445,775 by 2005.

In that year the Wisconsin Supreme Court, in the case of Ferdon vs. Wisconsin Patients Compensation Fund, struck the cap down after finding it to be in violation of the state constitution’s provision.

The state Legislature did not wait long to institute another cap, adopting the current one in 2006. This time, the maximum payout was set at $750,000.

Unlike under the old system, the new cap was not set up to be adjusted once a year in accordance with increases in the cost of living, although there a provision was adopted allowing state lawmakers to make periodic changes. Other new restrictions included limits on the fees that attorneys can charge or recover in medical-malpractice lawsuits and rules governing who can seek compensation.

A cap on justice?

Wisconsin’s medical-malpractice laws, according to various plaintiff attorneys, have come over time to place more and more limits on what sort of cases can be taken on with any hope of success.

“The system that we have here makes it easy for the insurance companies for doctors to take cases to trial,” said Michael End, a lawyer who specializes in medical malpractice. “They don’t have much incentive to settle. … And the insurance company pretty much wins.”

Since the adoption of the current cap in 2006, the number of medical-malpractice suits filed in Wisconsin has gone down sharply. In 2005, 240 lawsuits were brought forward alleging negligence or other misdeeds on the part of doctors and their fellow practitioners. By 2014, the annual number of filings had fallen to 84, according to statistics from the Office of the Director of State Courts’ annual reports.

Plaintiff lawyers say these numbers show how selective they’ve become about what sorts of cases they’ll take. End said his firm – End, Hierseman & Crane LLC in Milwaukee – has three lawyers and gets at least ten calls a day about possible lawsuits. He said the chances are good that he and his associates will decline all of them.

“The overwhelming probability is that if someone calls us, we’re not going to do it,” said End. “We have to be more selective. When we take a case it’s a sure thing that we’re going to spending hundreds of hours on that case – and thousands of dollars.”

Unlike in other sorts of litigation, End said, defendants in medical-malpractice lawsuits have little incentive to resolve legal disputes outside court. One reason for the hesitancy, he said, is that doctors are required to report any settlements they’ve been involved in to the state’s Department of Safety and Professional Services, as we as to an even larger tracking system known as the National Practitioner Data Bank.

The resulting records have been known to haunt medical practitioners in future job searches. Many doctors would rather fight things out in court than impede their employment prospects.

“We continually have tried to bring the impact of these limitations to the attention of the public and lawmakers,” said Ann Jacobs, president of the Wisconsin Association of Justice, which is the state’s trial attorneys association. “These laws have the perverse effect of preventing seriously and legitimately injured people from having their day in court and holding grossly negligent doctors accountable.”

As a result, she said, grossly negligent doctors are not being punished and can continue practicing. Other recent law changes have put up even more obstacles to medical-malpractice lawsuits.

Most notably, state legislators in 2013 passed a bill that altered medical practitioners’ duty of “informed consent.” Previously, doctors had to tell patients all the reasonable diagnoses of a particular condition and then list various treatments and their likely consequences.

Now, doctors no longer have to worry about alternative diagnoses, and only have to inform patients about the one they believe is most likely accurate. Had the new informed-consent standard been in place sooner, some plaintiffs lawyers say, it might have even prevented the Mayo lawsuit from going forward, since the case involves a doctor’s alleged misdiagnosis of a Strep A infection.

Defenders of the current system, meanwhile, argue that the cap on non-economic damages both ensures doctors can practice to the best of their ability, without fear of being sued, and serves as a check on frivolous lawsuits.

Guy DuBeau, a health care defense attorney, said the state’s $750,000 cap should be viewed as being part of a bigger picture. He noted that Wisconsin, while setting a limit on non-economic damages, has no corresponding maximum for economic damages.

“I’ve never run across any of my friends in the plaintiff bar who would really, legitimately turn down a good case because they’re only going to get three-quarters of a million dollars in this one area of damage, where there’s certainly a potential for a lot more than that in another – if there’s another area,” he said.

Wisconsin is, in fact, perhaps the only state that couples no cap on economic damages with a requirement that doctors carry umbrella insurance coverage, said Mark Grapentine, who lobbies for the Wisconsin Medical Society on the behalf of medical professionals.

Patricia Putney, a defense attorney at Bell Moore & Richter, says she and her colleagues find themselves litigating few medical-malpractice cases these days as plaintiffs lawyers shy away from those sorts of cases. (Staff photo by Kevin Harnack)

Patricia Putney, a defense attorney at Bell Moore & Richter, says she and her colleagues find themselves litigating few medical-malpractice cases these days as plaintiffs lawyers shy away from those sorts of cases. (Staff photo by Kevin Harnack)

“And that’s the way it should be,” he said. “… If someone is harmed because of negligence, they can get every last dollar that they deserve from a fund that is stable and working well without having to go into this weird world of who can be more theatrical in the courtroom and get a jury to feel badly for someone…”

“Because of that, (physicians) are going to practice medicine according to what the latest science says as opposed to what the latest lawsuit environment is like,” he continued. “I think that’s what reflects in our quality of care.”

Grapentine said he and his members are not in favor of going the route that various other states have and imposing a limit on economic damages.

Rather, he said, his and his associate’s priority is on maintaining a balance in Wisconsin.

Grapentine noted that Wisconsin came in at number two in 2015 in the federal Agency for Healthcare Research and Quality’s annual health care rankings. The state’s place near the top has been consistent over the years, Grapentine said, suggesting that the current system serves both doctors and patients well.

Taking on the cap

For the sake of protecting the good results, said Grapentine, the medical society is keeping a close eye on cases like the Mayo lawsuit. So are those who think the state’s medical-malpractice laws could stand improving.

Jacobs said the significance of the Mayo case can be overstated.

“It is both more and less important than it seems,” she said.

On the one hand, the case sheds light on how the cap stands in the way of justice for those who have suffered the most horrific injuries, she said. On the other, the Mayo lawsuit might ultimately have little influence on future court proceedings, largely because the trial judge was explicit in saying his decision applied to a very specific set of circumstances, Jacobs said. The court found that only in Mayo’s case did the $750,000 cap violate the principle of due process.

Even so, Eric Farnsworth, a lawyer in Madison is now litigating a medical-malpractice case in Green County, said the case remains capable of planting a seed that could eventually sprout far-reaching roots.

“If that concept gets firmly implanted in Wisconsin jurisprudence,” he said, “it will allow review of the $750,000 cap and perhaps then the playing field will get more level.”

Editor’s note: This article has been corrected to reflect that the Mayo case was tried in Milwaukee County. Also, Ascaris Mayo is a resident of Milwaukee.

 

The steadily disappearing med-mal lawsuit

Lawyers who take on medical malpractice as a specialty are a dying breed in Wisconsin.

Although the causes of the decline are complex and many in number, the chief one is simple enough. The state’s $750,00 cap on non-economic damages and similar restrictions make it impractical to take all but the most egregious cases — such as the Mayo case featured in our cover story — to court.

“Other than a very small number of us….” said Mike End, a plaintiff attorney, “everyone else has abandoned the whole practice of taking medical-malpractice cases.”

Defense lawyers are noticing the trend as well. Patricia Epstein Putney, a lawyer at Bell Moore & Richter, said she takes on fewer medical-malpractice cases than she did years ago, adding that most of her colleagues can attest to seeing the same thing.

She said she enjoys medical-malpractice work but nonetheless finds herself litigating more cases involving car accidents and general liability.

Guy DuBeau, a health-care defense attorney at Axley Brynelson LLP in Madison, likewise said he has seen a general decrease in the number of medical-malpractice cases that are being filed, as well as an increase in the number of clients who seek to resolve a complaint before a lawsuit is ever filed.

Putney agreed. More and more of her clients, mostly insurance companies and healthcare companies, are choosing to deal with claims on their own rather than turn to outside counsel, she said.

She said she is also seeing more pro se litigants go before the state’s medical-mediation panel, a board that is always given a chance at resolving a dispute before a formal lawsuit can be filed in circuit court.

“From our perspective, plaintiff attorneys are not taking the cases they used to take,” Putney said, “and so we have less to defend.”

DuBeau said he suspects that the 2008 recession played a part in plaintiff attorneys’ shying away from bringing cases.

“That’s when I saw cases pulled back,” he said.

As happened to many other businesses, law firms found themselves with shortened credit lines during the recession. As a result, plaintiff attorneys had to start taking cases with smaller up-front costs.

Defense attorneys make money largely in a different way and so were not as affected. Whereas plaintiff attorneys usually receive contingency fees if they are successful in getting a verdict or settlement, those on the defendant’s side can often rely on insurance companies to cover many of the pre-trial costs.

The result, Putney said, is that defense attorneys are less constrained by cash-flow considerations.

Cost, meanwhile, isn’t the only source of anxiety for plaintiff lawyers. Farnsworth noted that if a case is lost, he and his colleagues are out not only what they spent up front on experts, but also the time devoted to the case, which often comes to between 2 ½ and three years.

Many plaintiff attorneys try to mitigate the risks by diversifying their caseloads. But a strategy of that sort can bring its own troubles.

For example, Eric Farnsworth, a plaintiffs lawyers at DeWitt Ross & Stevens, said that if he has ten cases going at once and two of them are medical-malpractice cases, those two will take up at least 80 percent of his time.

“Quite frankly, as a business decision,” he said.

“I don’t know how you can survive simply doing medical-negligence cases given the challenge.”

Why do it full time, then?

“I ask myself that everyday …” said End. “There’s clearly a need for people to be able to go into court and try to recover fair compensation … (A)nd if we throw in the towel, as 99 percent of lawyers have, it’s going to be tough for those people to even think about achieving justice.”

— Erika Strebel


About Erika Strebel, [email protected]

Erika Strebel is the law beat reporter for the Wisconsin Law Journal and a law school student at UW-Madison. She can be reached at 414-225-1825.

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