Medical Malpractice Structured Settlements

What Is a Medical Malpractice Structured Settlement?

Structured settlements are often distributed to plaintiffs as compensation for personal injury lawsuits, including medical malpractice claims.

A structured settlement is a financial tool that distributes payments from a large sum of money to an individual over time. This steady, reliable income stream can help to secure your financial future, especially if the medical malpractice resulted in ongoing medical care or loss of wages due to an inability to work.

A medical negligence claim involves professional health care negligence that ultimately causes a patient harm or an untimely death. Negligence or professional omission can occur from flawed treatment, inaccurate diagnosis or error in aftercare.

Medical malpractice — or medical negligence — can also include:

• Unnecessary surgical procedures.
• Surgical errors.
• Early discharge from a medical facility.
• Little to no consideration of patient medical history.
• Failure to identify symptoms.
• Prescribing incorrect medication or improper dosage.
• Misreading laboratory results.

Before filing a medical malpractice claim, you must be able to prove negligence occurred in your case and receive confirmation from a hired medical expert. 

Some cases are settled before a lawsuit is filed. For example, if you — also referred to as the plaintiff — and the accused doctor and their affiliated insurance company — legally referred to as the defendants — agree to the negotiation terms. If both parties do not reach a settlement agreement, you have the option to file a lawsuit that requires a judge to rule in favor of the case.

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Minors and Medical Malpractice

Most medical malpractice structured settlements span decades, possibly until or even after the plaintiff’s death. In the case of a minor, however, many medical malpractice structured settlements are set up to end when the child reaches the age of maturity (anywhere from 15 to 21 years old, depending on the state). 

In these cases, the structured settlement will distribute regular payments to the child’s guardian while they are a minor to pay for ongoing medical expenses, resulting in the final lump-sum payout when they reach the age of maturity.

A medical malpractice structured settlement is a way to capture a consistent reliable stream of payments associated with a successfully litigated lawsuit. The alternative is a lump sum payment, which isn’t ideal for everyone.

Thomas J. Brock, CFA®, CPAInvestment, Corporate Finance and Accounting Professional

Thomas Brock, CFA®, CPA, is a financial professional with over 20 years of experience in investments, corporate finance and accounting. He currently oversees the investment operation for a $4 billion super-regional insurance carrier.

Filing a Medical Malpractice Claim

If you feel you have a qualifying medical negligence case, make sure you take the appropriate steps prior to filing a claim. Skipping steps can ultimately affect your right to repayment.

There are three key steps to take before filing your claim. 

Talk to Your Doctor

Prior to filing a medical negligence claim, take the time to discuss with the physician who treated you what may or may not have gone wrong. If the doctor made a mistake, see if they can right the wrong before deciding to pursue legal action.

Find a Lawyer

Though there are some legal cases you may be able to handle alone, a medical malpractice suit is not one of them. Lawyers have experience and can provide the best guidance in your next steps to filing a claim. They can handle your negotiations and help to ensure you are compensated for your discomfort and losses. Take your time in finding the best legal counsel to represent you.

Know the Statute of Limitations

Medical malpractice claims have a time limit as to when they can be filed from the time of injury. If filed too late, you risk forfeiting your right to any compensation for your injuries. Be sure to check your state’s statute of limitations, so your case remains timely.

Ensuring that you have all the information that you need and are fully prepared before filing your medical malpractice claim can help increase the chances of you receiving the outcome that you are looking for.

It also may help you to better understand whether you do have a legitimate case to make.

Read More: Medical Malpractice Lawsuit Funding

Burden of Proof

The law defines medical malpractice and certain prerequisites needed for a judge to hear a case. One factor to be aware of in your claim is the burden of proof.

In order to prove that negligence occurred, you must be able to prove several different key things.

Existence of a Doctor-Patient Relationship

You must be able to prove there was a sufficient doctor-patient relationship, meaning a doctor treated you directly. If you hired a doctor and they agreed to act as your designated physician, the relationship is valid. Simply seeking a doctor’s opinion via consultation does not qualify as a doctor-patient relationship because a doctor cannot leave you with adequate treatment options during a consultation.

The Doctor Was Negligent

Doctors must also be found negligent in prescribing treatment or providing a diagnosis. To qualify as medical malpractice, you must prove your doctor caused you harm in a situation where a competent doctor would not. It is not enough to prove a health care provider breached the standard of care or their duty to inform patients of a conflict of interest or material risks. The standard of care varies by condition, but generally means care any doctor with similar training at a health care facility in a similar community would have provided.

The Doctor’s Negligence Caused Injury

You must connect the doctor’s action or inaction to your injury. It is not uncommon for legal officials to seek confirmation from a medical expert. If a patient was injured or sick prior to interaction with a doctor, it can be more difficult to prove the doctor did more harm.

The Injury Resulted in Damages

Lastly, you must be able to show the damage costs are significant. Malpractice suits can be expensive. If a patient can show no mental, emotional or financial harm, the malpractice claim may not be winnable.

Receiving a Medical Malpractice Settlement

Though some medical malpractice claims can be settled before filing a lawsuit, many bigger cases require a formal trial after filing a claim. Settling a medical malpractice claim can take months or years after filing the lawsuit due to an extensive approval process. 

Filing a suit does not guarantee a malpractice settlement, and the process can cause significant financial strain. Be sure to consult with a legal advisor prior to continuing with your claim in order to ensure the benefits outweigh the risks.

Negotiation

Negotiating your settlement is a crucial part of a medical negligence case. As with any settlement, the dollar amount that the defendant and plaintiff negotiate is meant to represent the amount of damages the plaintiff endured.

While calculating financial damages and expenditures can be simple, negotiating a fair amount to cover intangible damages — including pain and suffering, emotional strain, etc. — can be more difficult. 

In addition, there are state laws limiting the amount of money you may be able to receive. Once a fair settlement has been reached, you will be one step closer to receiving structured settlement payments.

Receiving Doctor’s Approval

In order to receive a settlement outside of court, the doctor or defendant must agree to the negotiation terms.

If a doctor chooses not to settle, they may take their chances in court to not risk paying inflated insurance costs or jeopardizing their career. Battling a medical negligence case in court can take months and may sometimes discourage a plaintiff from pursuing the case. Be sure to keep this in mind prior to filing a claim.

Payout Options

The medical malpractice settlement negotiations can result in the plaintiff receiving a settlement in a lump sum, a structured settlement or a combination of the two. With a lump sum, the plaintiff receives a full payout, which can be helpful when paying legal and medical bills up front. It is a common and simple option in many medical negligence cases.

However, receiving a structured settlement may be more beneficial in handling long-term medical and financial debt. Structured settlements ensure payment is distributed consistently over the course of years.

In some cases, plaintiffs have no choice but to receive a structured settlement because insurance companies that finance the settlement prefer structured settlements for malpractice suits.

Frequently Asked Questions