Medical malpractice fund surplus reaches $783 million

Medical malpractice fund surplus reaches $783 million

According to an audit last month, Wisconsin that has a $1.2 billion state run fund through which it pays its medical malpractice awards has been found to have a surplus of $783 million, which is $406 million more than recommended. According to the attorneys, the large size of the Injured Patients and Families Compensation Fund illustrates how hard it is for injured patients to win cases against the doctors.
 

Mike End, a medical malpractice attorney and former president of the Wisconsin Association for Justice, trial lawyers’ group stated there being fewer people getting compensation and getting into the fund money these days. Moreover, the Wisconsin Medical Society which represents doctors has stated that the fund provides stability and must be large enough to cover unexpected claims.
 

Furthermore, Mark Grapentine, a medical society lobbyist stated that the fund does not cover cases in the pipeline only, but even the ones that are yet undiscovered. Wisconsin is one of at least 13 states with the funds that cover malpractice awards of more than $1 million wherein doctors, hospitals and some other health care providers are required to pay into it. However, doctors must carry their own malpractice insurance up to the amount of $1 million.
 

In recent years, largely due to investment income, the fund’s value grew considerably and thereafter, the regulators started reducing doctors’ annual fees beginning in 2013-14. Later in 2014-15, the doctors paid $1,311 to $8,653, depending on the type of the doctor’s practice.
 

According to the Legislative Audit Bureau report last month, the fund’s surplus in September was $783 million, $406.4 million more than the upper end of the range recommended last year by regulators, of $86.4 million to $376.6 million. The audit to the Office of the Commissioner of Insurance, which administers the fund, recommended that a plan should be developed so as to bring the surplus into the target range.
 

However, Ted Nickel, insurance commissioner has stated that the fees will be reduced again by 30 percent in 2016-17. End has stated that the fund’s total assets, which were $1.2 billion in June, are $345 million greater than the $855 million the fund has paid in 672 claims since it was created in 1975.
 

According to the attorneys, the restrictions applied on those who can sue, the caps on damages as well as the fund, it becomes very difficult for the injured patients to get compensation. The National Practitioner Data Bank ranks Wisconsin as the 49^th state in malpractice payments per capita from 2004 to 2014. Wisconsin prohibits parents from suing if their children die from a medical error, and adult children cannot sue if their parents die in the same way. However, in other wrongful death cases, damages are capped at $500,000 for a child and $350,000 for an adult.
 

In other medical malpractice cases, non-economic damages, such as for pain and suffering, are capped at $750,000. Economic damages are not limited. The cap on total damages for UW-Madison doctors is $250,000.
 

According to End, the fund gives the doctors and insurers less incentive to settle cases because they do not stand to lose multimillion dollar awards. But as per Grapentine, the fund keeps medical malpractice liability predictable by protecting against uncertainties. Furthermore, he also stated that the board of governors overseeing the fund has a fiduciary responsibility to ensure that there are enough assets in the fund to cover those admittedly unquantifiable potential liabilities down the road.