August 31, 2019

In January 2019 the Department of Treasury revised the Medical Malpractice Damage Caps in Michigan, and published a document entitled “Limitation on noneconomic damages and product liability determination on economic damages.” Michigan caps are particularly complex compared to other states, and it is best to discuss it with your medical malpractice lawyer at our law firm.

What is a Medical Malpractice Damage Cap?

Limits or ‘caps’ were implemented in approximately half the states across the country as part of tort reform. The caps vary from state to state, and in some states, they were successfully challenged as unconstitutional and abolished.

Caps can apply to all damages (umbrella cap) or either economic or non-economic damages. Some include punitive damages while others do not.

Economic damages include any medical bills, out-of-pocket expenses, lost wages, or lost opportunities resulting from the injury. This may include past medical care, ongoing medical care, and any other measurable financial losses or expenses.

Noneconomic damages include pain and suffering, anxiety, emotional distress, loss of consortium, and loss of enjoyment of life. These are more difficult to prove, as they are less tangible.

Michigan’s Medical Malpractice Cap

First established in 1993, and originally capped at $280,000, the cap in Michigan applies to noneconomic damages only. This is described in the Michigan Compiled Laws section 600.1483.

In January 2019, this cap was adjusted for inflation to $465,900 based on the consumer price index calculated in cumulative percentage annual increases.

However, Michigan separates specific types of injuries that are severe or permanent into a different category, and that cap is significantly higher at $500,000 originally, adjusted to $832,000.

This higher cap will apply to a range of circumstances, where the patient suffered severe or permanent damage to a vital organ, for example:

• permanent cognitive impairment, which effectively renders the patient unable to make independent life decisions or perform activities of daily living independently.
• paralysis resulting from damage to the brain or spinal cord.
• damage to reproductive organs, which leaves the patient unable to procreate.

In the event of the death of the patient, it will become a wrongful death suit.

For product liability, the same caps apply, extended in the case of death or permanent loss of a vital body organ.

In addition, Michigan provides for economic losses that cannot be calculated by the trier of fact, to be based on the average median family income as adjusted by the state treasurer, now set for 2019 at %72,799.

How Michigan Compares to Other States

There are 27 states with Medical Malpractice Caps, the highest being Virginia at $2.35 million, and the lowest being Texas, which limits damages to $250,000 per provider.

Some states, like Massachusetts, caps the damages but lifts it entirely for particularly debilitating injuries. Nebraska includes a provision to lift caps if the defendant’s malpractice caused by an intentional act, gross negligence or malice. Tennessee increases the cap for catastrophic events.

Why do States impose Medical Malpractice Caps?

Nothing in life is for free, and in the end no matter what the award, someone must pay for it. In most cases, this falls to the insurance companies, whom will recover the high pay-outs by increasing all their customers’ premiums, and extraordinarily large awards can negatively affect the local state economy through the knock-on effects of these payments.

If you live in Michigan, and you have suffered injury, call Eileen Kroll, a Registered Nurse and Personal Injury trial attorney, at Cochran, Kroll & Associates P.C., at 1-866-MICH-LAW (1-866-642-4529) for a free evaluation of your case and further assistance.