Medical Malpractice Update - Wisconsin

The ABA Journal reports that the Wisconsin Supreme Court struck down a cap on medical malpractice damages.  The Journal reports,

The 4-3 ruling came in the case of Matthew Ferdon, now 8, of Abrams, about 20 miles north of Green Bay. The boy has a deformed and partially paralyzed right arm caused by an injury at birth. Jurors awarded Ferdon $403,000 for future medical expenses and another $700,000 for pain and suffering, twice the state limit.

The case made it to the state high court after the trial judge reduced the pain-and-suffering award. Chief Justice Shirley S. Abrahamson didn’t have to look far for an equal protection problem.

"Indeed, the burden of the cap falls entirely on the most seriously injured victims of medical malpractice," Abrahamson wrote for the majority. "Those who suffer the most severe injuries will not be fully compensated for their noneconomic damages, while those who suffer relatively minor injuries with lower noneconomic damages will be fully compensated. The greater the injury, the smaller the fraction of noneconomic damages the victim will receive."

Because doctors didn’t discriminate against Ferdon on account of his race, religion or similar characteristics, and because they didn’t violate a fundamental right, such as free speech, his case was ineligible for much tougher levels of scrutiny constitutionally required in such situations. Ferdon also had to defeat the statute’s heavy presumption of constitutionality beyond a reasonable doubt.

Instead of taking legislators at their word, which regularly occurs in cases using rational basis review, the Wisconsin court employed what academics sometimes call "rational basis review with teeth," and deeply delved into the law’s history and performance.

"The legislature enjoys a wide latitude in economic regulation," Abrahamson wrote. "But when the legislature shifts the economic burden of medical malpractice from insurance companies and negligent health care providers to a small group of vulnerable, injured patients, the legislative action does not appear rational."

Citing figures from the state insurance commissioner and the U.S. General Accounting Office, the court was unable to conclude that the cap had any measurable effect on insurance premiums. Few Wisconsin pain-and-suffering awards have exceeded the cap, and overall the state has not encountered the mammoth jury verdicts reported in other states. The court also suggested the blame for premium hikes lies more with the cost of defending huge numbers of baseless claims—perhaps up to 70 percent of those filed—rather than with the handful of cases that do end in large awards.

The court followed similar analyses in rejecting arguments about keeping the state insurance pool in the black, lowering patient costs and keeping doctors from fleeing the state.

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