November 20, 2012

In its decision rendered on October 31, 2012, the Indiana Supreme Court rejected the arguments of the Indiana Patient’s Compensation Fund in defending against a petition to recover excess damages arising out of a medical malpractice action when the Fund attempted to challenge the existence or cause of the plaintiffs’ injuries after the health care provider settled with the plaintiff and admitted liability.

Under the Indiana Medical Malpractice Act (“MMA”), the cap on the amount that a patient may recover for injury or death due to medical malpractice is $1,250,000. The liability of a qualified health care provider whose medical negligence proximately caused the injury or death is limited to the first $250,000. The Indiana Patient’s Compensation Fund (“PCF”) is responsible for the balance up to the amount of the cap if a judgment or settlement fixes damages in excess of the $250,000 for which the responsible health care provider is liable. Ind. Code § 34-18-14-3(c).

Indiana Code § 34-18-15-3(5) provides, in part, “If the commissioner, the health care provider, the insurer of the health care provider, and the claimant cannot agree on the amount, if any, to be paid out of the patient’s compensation fund, the court shall, after hearing any relevant evidence on the issue of claimant’s damage submitted by any of the parties described in this section, determine the amount of claimant’s damages, if any, in excess of the two hundred fifty thousand dollars ($250,000) already paid by the insurer of the health care provider. The court shall determine the amount for which the fund is liable and make a finding and judgment accordingly. In approving a settlement or determining the amount, if any, to be paid from the patient’s compensation fund, the court shall consider the liability of the health care provider as admitted and established.”

In the case before it, the parents of a four-year-old boy who was diagnosed with a mild form of cerebral palsy known as spastic diplegia filed a complaint under the MMA, claiming that the health care providers who delivered their son were negligent in that they failed to adequately monitor his condition during labor and delivery and then failed to respond when signs of fetal distress appeared that resulted in the development of the boy’s condition. Shortly before trial, the defendant health care providers settled for a sum greater than $250,000, thereby allowing the plaintiffs to seek excess damages from the PCF.

The PCF sought to introduce evidence during the hearing to dispute the nature of the boy’s injury, contending that he either has no injury or that his injury was not caused by the health care providers’ breach of duty.

The Indiana Supreme Court did not allow the PCF to litigate the issue, stating that the plaintiffs claimed a single injury: cerebral palsy consisting of spastic diplegia, which claim the health care providers settled, and thus that is the claim for which liability is “admitted and established” under Indiana Code § 34-18-15-3(5), and all that remained to be determined was the amount of damages to which the plaintiffs were entitled from the PCF for the medical malpractice – the plaintiffs have the benefit of final and established liability when the health care providers choose to settle. (Only in “increased risk of harm claims” would evidence of underlying risk be relevant to both liability and to damages.)


If you or a loved one may have suffered harm as a result of medical malpractice in Indiana or in another U.S. state, you should promptly consult with an Indiana medical malpractice attorney or a medical malpractice attorney in your state who may be willing to investigate your medical malpractice claim for you and file a medical malpractice case on your behalf, if appropriate.

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