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07.16.2019

Lottery Mentality of Today’s Juries – How Much is Enough?

Meredith Akerlind - IronHealth - A Liberty Mutual Company

People’s perspective of what is a lot of money continues to escalate. How much is enough? How much is too much? Never has this lottery mentality been more on display than in recent jury awards related to healthcare lawsuits. While the frequency of healthcare professional liability claims may have stabilized or even shown slight declines, the increased severity of such claims has been staggering.

What has driven up the monetary values of plaintiff cases? Some speculate that the impact of news media coverage and social media have raised the awareness of medical awards as there are no longer obvious distinctions between rural or urban-based cases nor conservative or more liberal juries, which used to be the norm. People everywhere have access to news – big money news. Political influences are another factor, reflecting outrage over affordable, accessible healthcare as people have become pre-occupied with looming health insurance coverage issues. Whatever the reasons, medical and legal professionals have expressed the concern that in today’s environment, it is difficult to get a balanced, reasoned jury.

Severity of healthcare professional liability claims are being seen across the spectrum, from life sciences, medical devices to opioid abuse and, on the horizon, legalized marijuana usage. Obstetrics liability claims are the less frequent, but extremely more severe in comparison with other medical specialties in the healthcare sector. The majority of such claims are related to delivery complications or injuries suffered by the infant at birth. A brain damaged baby settlement prior to 2015 could result in judgments from $6 to $8 million. As more of these horrific incidents end up in court, awarded damages for an infant brain injury can reach into the $20 to $50 million range.

Claims severity also can be aligned with the increase in ‘batch claims’ where multiple, related claims are tied to the same event or medical product defect. Litigation ensues following discovery of a series of medical incidents in the rendering of professional healthcare services that resulted in bodily injury or harm to numerous patients at a medical facility or hospital. Today, the most common issues related to the upsurge in batch claims are tied to hospital sterilization practices and employee misconduct. Batch claims have become more prevalent given an aggressive plaintiffs’ bar eager to seize on systemic medical risks at healthcare institutions.

Case management costs surrounding claim severity have ballooned in preparation for high profile, potentially high award cases. Mock trials, panels of experts, jury focus groups are all tactics

deployed in advance of settlement discussions and eventual trial for defense lawyers to assess influencing factors and likely outcomes. The drill is to determine whether the plaintiff should reach a settlement agreement or to “hold your ground” based on the belief that they could win a significant jury verdict at trial. For healthcare liability insurers, pressure on rates has become unavoidable driven by the need to generate premium in anticipation of large verdicts, typically well in excess of $5 million. For example, five years ago a healthcare liability insurer would not have to open up a live file prior to settlement discussions. Further, an excess insurance writer may not have been involved as case settlement or jury verdict for payment of reasonable damages would have been adequately covered at the primary level.

The trend toward high severity claims and outsize jury awards is likely to continue. In today’s litigious era, there has been a seismic behavioral transference in believability or burden of proof in the court of public opinion against institutions, healthcare systems and medical professionals. Healthcare professional liability insurers will be challenged to balance pricing with exposure to anticipated severity of risk.

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