Understanding Your Recovery in a Medical Malpractice Case

Medical Malpractice (“Med-Mal”) cases present a wide range of issues that make them difficult to litigate. Perhaps one of the more difficult issues from a potential Plaintiff’s perspective is the fact that the Nevada legislature has set a cap on the recovery for “non-economic” damages.

Nevada Revised Statute 41.A. 035 states:

“In an action for injury or death against a provider of health care based upon professional negligence, the injured plaintiff may recover noneconomic damages, but the amount of noneconomic damages awarded in such an action must not exceed $350,000, regardless of the number of plaintiffs, defendants or theories upon which liability may be based.”

Do Caps on Medical Malpractice Violate your Constitutional Rights?

Right to a Jury Trial: Simply put, no. The Nevada Supreme Court has said that although states have differing opinions on the issue, Nevada courts have clearly held that a “statutory limit on damages does not infringe upon a plaintiffs constitutional right.” [1] Nevada courts have determined that it is for the legislature, not the jury, to determine the “legal consequences of its factual findings.”

Equal Protection: Similarly, the Nevada Supreme court has also determined that such caps do not violate equal protection because the purpose of the stature is rationally related to a legitimate government purpose of ensuring that adequate and affordable health care is available to Nevada’s citizens.

When the question was posed to Nevada votes in 2004, the argument in support of the caps was that its intended purpose was to “stabilize Nevada’s health care crisis and provide protection for both doctors and patients.” The ballot measure received wide spread support from Nevada residents and passed.

What are “Non-Economic Damages” and How Does This Effect My Case?

If you believe that you have suffered from medical malpractice [2], it is important for you to understand how a cap on non-economic damages can effect your case. As such, it is helpful to distinguish between “economic” and “noneconomic damages.”

  • “Economic Damages” are expenses from medical treatment, care or custody, loss of earnings and loss of earning capacity [3]. There is no cap on economic damages; thus, one who suffers from medical malpractice and has medical expenses (both past and future) will be able to collect those damages. Also, any wage loss incurred (both past and future) will also be able to be recovered.
  • “Non-economic damages” constitute compensation for pain, suffering, inconvenience, physical impairment, disfigurement and other non-pecuniary damages [4]. This is most commonly known as “pain and suffering” and represents the bulk of what a jury may award. Unfortunately, Nevada law bars any amounts over $350,000.00. Thus, you could lose a leg during a botched surgery and the most the law allows a victim to recover is $350,000.00. This does not apply to economic damages—so if that same victim had the need for prosthetic devices which, over his/her lifetime, equaled $750,000.00, the medical expenses including such devices are not capped at the $350,000.00.

For example, if a physician’s professional negligence caused you to sustain medical expenses in the amount of $50,000.00, and a loss of earnings in the amount of $25,000.00, your total economic damages would be $75,000.00. If this same injury has now caused a permanent disfigurement and lifelong injuries, the most that you could receive in “non-economic” damages for your pain and suffering are $350,000.00. As a result, the maximum on your total recovery would be $425,000.00.

Does It Matter if there are multiple Defendant Doctors, or Multiple Plaintiff’s?

No, the cap applies regardless of the number of plaintiffs, defendants or theories upon which liability may be based. In Tam v. Eighth Jud. Dist. Ct. the Nevada Supreme Court was asked to determine whether the term “action” in NRS 41A.035 refers to each separate claim, whereas it applies separately to each defendant, or if it refers to the case as a whole. In coming to its conclusion, the Supreme Court of Nevada looked to the legislative history of NRS 41A.035 and found that the “noneconomic damages cap in NRS 41A.035 applies per incident, regardless of how many plaintiffs, defendants, or claims are involved.” [5]

How Much Of Your Medical Malpractice Recovery Do You Get To Keep?

It depends. Your personal recovery is largely dependent on the existence of a health insurance lien. A lien is essentially the legal right of another to be paid or compensated from your personal injury settlement. The amount owed to your lienholders will be subtracted from your settlement first, as well as cost and fees associated with your attorney’s representation (Attorney’s also have a legal right to take out a lien on your settlement). That is why it is important to understand the fee arrangement you have agreed to with your attorney. Health insurance liens are a priority lien such that any amounts paid by a health insurer must be paid back 100%. This, in essence makes the recovery of such monies a windfall to the insurance as they do nothing to collect it except rely on the lawyer and the victim to go collect it. The amount of the actual health insurance payments are the only amounts the jury is allowed to consider. This is in contract to other types of negligence actions where the fair market value of the bill is actually allowed (i.e. not the lessor insurance contracted amount.) This is one other factor why attorneys may not take a personal injury malpractice matter as the medical expenses are drastically reduced by this rule. For example, a $100,000 hospital bill may only be reimbursed at 10% or $10,000.00. The jury is not to consider the $100,000 because health insurance only paid $10,000.00. This is known in Nevada as the collateral source doctrine. Collateral sources are normally not allowed; however, in medical malpractice cases, the collateral source doctrine is basically alleviated.

EXAMPLE: Total Settlement = Economic + Noneconomic Damages (Past and future) – (Liens) – (Attorney Fee’s)

Attorney’s fees are also capped in Med-Mal cases. Under NRS 7.095 Limitations on contingent fees for representation of persons in certain actions against providers of health care.

1.  A personal injury attorney shall not contract for or collect a fee contingent on the amount of recovery for representing a person seeking damages in connection with an action for injury or death against a provider of health care based upon professional negligence in excess of: (a) Forty percent of the first $50,000 recovered; (b) Thirty-three and one-third percent of the next $50,000 recovered; (c) Twenty-five percent of the next $500,000 recovered; and (d) Fifteen percent of the amount of recovery that exceeds $600,000.

Not all cases are medical malpractice cases. Nevada specifically defines when these laws apply. Under NRS 7.095(4) (b) “Provider of health care” means a physician licensed under chapter 630 or 633 of NRS, dentist, registered nurse, dispensing optician, optometrist, registered physical therapist, podiatric physician, licensed psychologist, chiropractor, doctor of Oriental medicine, medical laboratory director or technician, licensed dietitian or a licensed hospital and its employees. Thus, certain professions, such as a pharmacist, are not protected by the caps and other rules that govern malpractice actions.

 [1]   *Tam v. Eighth Jud. Dist. Ct.*, 358 P.3d 234., Nev. No.66346, 2015; see also 
*Armesano v. State, Dep’t of Tansp.*, 113 Nev. 815, 819, 942 P.2d 139, 142 (1997) 
 [2]   Medical Malpractice has the same definition ascribed to it as “Professional 
negligence,” which means “the failure of a provider of health care, in rendering services, 
to use the reasonable care, skill or knowledge ordinarily used under similar circumstances 
by similarly trained and experienced providers of health care.” NRS. 41A.015; see also 
Tam v. Eighth Jud. Dist. Ct., 358 P.3d 234., Nev. No.66346, 2015 (NRS 41A.035 applies 
to professional negligence claims, which by definition of NRS 41A.015 applies to 
"a provider of health care," and includes physicians licensed pursuant to NRS 
Chapters 630 and 633. NRS 41A.017.)
 [3]   NRS 41A.007
 [4]   NRS 41A.011
 [5]   *Tam v. Eighth Jud. Dist. Ct.*, 358 P.3d 234., Nev. No.66346, 2015

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