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Michigan lawyers specializing in civil litigation




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Sunday, February 15, 2004

The fact that only 10% or 20% of cases of cerebral palsy are related to perinatal hypoxia does not mean that only 10% to 20% of the lawsuits making this claim are valid, for a number of reasons.  Nonetheless, I will be the first to acknowledge that only a minority of these claims are in fact meritorious, and that most cases that are filed on the basis of this causation claim do not hold water medically.  Yet they commonly result in verdicts for the plaintiff when they reach the trial stage, and they more commonly result in generous pretrial settlements because the defendants do not want to see what might happen when they reach the trial stage. 

As I stated earlier, this militates in favor of some alternative to the tort system for these injuries.  There are two states which have adopted similar no-fault plans covering birth-related injuries, and each has been in effect for more than a decade.

In the State of Florida, a Florida Birth Related Neurological Injury Compensation Act (sometimes referred to as NICA), was passed to allow families to recover compensation for certain catastrophic birth injuries without consideration of fault.  Signficantly, only certain type of injuries are eligible, and it must be established that the injuries were caused by events during the intrapartum period (i.e., during labor and delivery - contrast "perinatal" events, which may include anything in the last few months of pregnancy).  The Fund covers claims for treatment and intervention, including medical and rehabilitation expenses, equipment, drugs, etc.; up to $100,000 to the parents; and attorneys' fees.  It does not award any compensation to the child for non-economic damages such as pain and suffering, disfigurement, or disability, or for economic losses relating to the inability to work. 

Physicians join the fund on a voluntary basis, and contributions to the fund by hospitals are mandatory.  Contributions to the fund come from participating physicians, all hospitals, and liability insurance carriers.  In 2003, the contribution for participating obstetricians was $5,000 per year, and the assessment on non-participating physicians is $250 per year.  Hospitals are assessed $50 for each birth, with an annual maximum of $150,000.  There is provision for an assessment on liability carriers if needed to ensure the financial viability of the program, but it has not been invoked.

A participating physiciain is immune from tort liability, and the immunity extends to all health care providers who were involved in the delivery.  The fund has per-occurrence and annual aggregate limits, and the physician may still be liable for payments which exceed those limits.  

The statute was passed in 1988, so it has been in effect for more than ten years in Florida.  A report shows that, as of June 2002, 161 claims have been approved for benefits.

The Virginia Birth-Related Neurological Injury Compensation Act was passed in 1987.  Eligibility factors are essentially identical to those in Florida.  Funding is similar, but there is an actual assessment on liability carriers.

The Virginia statute differs from Florida's in the payment to the family.  There is no compensation for the parents, but Virginia does compensate families for the child's lost earnings, described as "loss of earnings from age 18 to 65 calculated at 50% of the average weekly wage of private sector, nonfarm workers".  

The Virginia Legislature created a Joint Legislative Audit and Review Commission to evaluate the program in 2002.  It reported that 75 children were participants in the program, and the average yearly benefits paid were $62,000.  The fund was reported to be not actuarially sound at that time, holding about $84 million in assets against unfunded liabilities of $88 million.  In other words, some adjustments of assessments will need to be made; the program is not in imminent danger of collapse.

An amendment to the statute was passed in 2003 to add an additional payment, up to $100,000 in the discretion of the commission, to the family of an infant who dies within 180 days of birth, to compensate for "sorrow, mental anguish, solace, grief associated with the death of the infant, and all other material factors that are relevant".


An overview of both programs can be found at the web site of the State of Connecticut. 

With a grant from the Robert Wood Johnson Foundation, the Duke University Medical Center undertook a study and evaluation of the systems in both states.  A short-form report is available.  The findings as listed in the report were:

  • The Florida and Virginia no-fault programs achieved their primary objective, which was to maintain the availability of affordable obstetrical liability coverage for physicians.
  • Administration of no-fault is less expensive than under the tort system, and the speed of resolving no-fault cases, once filed, is very high.
  • No-fault claimants generally expressed satisfaction with the programs.
  • Only a small portion of potential claimants seeks compensation under either no-fault or tort.
  • The Florida and Virginia programs are too limited in scope to achieve many of the goals that proponents ascribe to the no-fault system such as broader access to compensation and increased prevention of medical injuries.

The findings and detailed reports were published in a number of medical journals:

Bovbjerg RR and Sloan FA. "No-Fault for Medical Injury: Theory and Evidence." University of Cincinnati Law Review. 67 (Fall): 53-125, 1998.

Bovbjerg RR, Sloan FA, and Rankin PJ. "Administrative Performance of 'No-Fault' Compensation for Medical Injury." Law and Contemporary Problems. 60 (Winter & Spring): 35-70, 1997.

Sloan FA, Whetten-Goldstein K, Entman SS, Kulas E, and Stout E. "The Road from Medical Injury to Claims Resolution: How No-Fault and Tort Differ." Law and Contemporary Problems. 60 (Winter & Spring): 71-115, 1997.

Sloan FA, Whetten-Goldstein K, and Hickson GB. "The Influence of Obstetric No-Fault Compensation on Obstetricians' Practice Patterns." American Journal of Obstetrics and Gynecology. 179 (September): 671-676, 1998.

Sloan FA, Whetten-Goldstein K, Stout EM, Entman SS, and Hickson GB. "No-Fault System of Compensation for Obstetric Injury: Winners and Losers." Obstetrics & Gynecology. 91 (March): 437-443, 1998.

Whetten-Goldstein K, Kulas E, Sloan F, Hickson G, and Entman S. "Compensation for Birth-Related Injury: No-Fault Programs Compared with Tort System." Archives of Pediatrics & Adolescent Medicine. 153 (January): 41-48, 1999.


Both states' compensation programs require that the claimant establish the causation element that we have been discussing.  The numbers discussed above reflect the claimants who have been found to be eligible.  The Robert Wood Johnson report disclosed that about half of the claims in Florida were rejected for failure to establish causation. 

6:32:17 AM    

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