How A Medical Malpractice Settlement Works

A cold, unfamiliar room with silent, serious on-lookers. Desks scattered with file folders, exhibits, and documents. Strange words and phrases that you don’t understand fill your ears. You’re in a courtroom, as the plaintiff in a medical malpractice case. Will this be your future? Your doctor failed you, so you have to take them to court…right? Not necessarily. Your case could resolve with a medical malpractice settlement.

It might surprise you to learn that a settlement is the more likely resolution. In this article, we’ll discuss why that’s the case. Plus, we’ll explain what you can expect from a malpractice settlement, and how they work in general.  

Man in wheelchair looks depressed.

Facts About Malpractice Settlements

Let’s take a look at some cold, hard facts about medical malpractice settlements. This data is from a 2006 New England Journal of Medicine study of nationwide malpractice cases.

  • Resolutions that involved a settlement favored the plaintiff in 61% of cases.
  • Only about 7 percent of malpractice cases ended up in a jury trial.
  • In 21% of court-tried cases, the outcome was in the plaintiff’s favor. 
  • Jury awards were almost twice the amount of settlements ($799,000 for jury awards and $462,000 for settlements).

What are the most common malpractice claims? According to the National Library of Medicine, most malpractice claims in hospital are due to surgical errors. While outpatient malpractice claims tend to stem from late or missed diagnosis.

Of course, these factors can’t predict what will happen in your case. Whether your case ends with a settlement or goes to court depends on many factors. So does the dollar amount you’ll receive, should the outcome be in your favor. Next, we’ll cover what those factors are, and how medical malpractice settlement negotiations work.

Negotiating A Settlement

The word “negotiation” means reaching a compromise. The injured patient and the negligent doctor have to decide on a dollar amount they’ll both accept. But the patient and doctor won’t sit down and negotiate face to face. Settlement talks usually happen between the patient’s malpractice lawyer and the doctor or hospital’s insurance company. 

The starting point for the settlement amount will be the patient’s economic damages. These include expenses like:

  • Hospital bills
  • Physical therapy 
  • Medical equipment 
  • Home medical care 
  • Loss of wages 

It’s hard for a defendant to dispute these damages. It’s easy to prove that your injury has taken a toll on you financially when you have receipts and bills. 

But then there’s non-economic damages. It’s hard to put a price on pain, hardship, and suffering. Insurance companies often value a patient’s non-monetary losses much lower than the patient would. This is why negotiations for a medical malpractice settlement often go back-and-forth for a while before both sides agree. 

In addition, there’s one more party involved in negotiations: state laws. Many states limit the amount of damages that a hospital or practitioner has to pay. 

Should I Accept A Settlement? Or Go To Court?

You might wonder whether you should accept a medical malpractice settlement. Or is it better to take the case to trial? Your malpractice lawyer can offer guidance on this. It may be in your best interest to accept a settlement, as long as it covers your expenses. That way you can avoid a long, drawn-out court battle. 

But the patient isn’t the only one who has to approve a settlement before it’s final. The insurance company has to get the defendant (the doctor or hospital) to agree to it first. Sometimes doctors prefer to take the suit to court. They may want to avoid having to pay higher insurance premiums, or getting dropped by their insurance company altogether. In other cases, doctors would rather go through a tedious trial than admit guilt. 

Let’s say both parties have agreed on a settlement amount. What’s next? There may be one more hurdle to jump before payout. Courts have to approve some types of malpractice cases, like ones involving minors. This is to prevent insurance companies from offering minuscule amounts that won’t cover an injured patient’s expenses. 

Man holds sign that says lump sum payment.

How Is A Medical Malpractice Settlement Paid?

It’s final. You’re going to receive a malpractice settlement. But how will you get the money, and when? There are three different options:

Insurance companies don’t always get to decide how they pay. Some states require t lump sums. Other states favor structured settlements, especially for minors who will have healthcare expenses for many years. 

Your attorney will receive settlement checks for you in an escrow account. They will deduct legal fees that you have agreed to, and you’ll receive the rest. 

Ready to begin the legal process? Let us use our 60+ years of experience to get you the settlement you deserve. Schedule an appointment here at no cost to you.