Med Mal News

Judge Clears Up Intersection of MCARE, Tort Claims Act

The federal government could end up paying millions of dollars in a medical malpractice suit, just as a privately funded hospital would, a federal judge has ruled in a case that clarifies how state and federal law intersect on the issue.

The parents of a baby born in a federally funded hospital filed suit against the government under the Federal Tort Claims Act, which lifts the government's sovereign immunity and allows people to sue, because the doctor who handled the delivery fractured the baby's skull by improperly using forceps. The child, now two years old, has severe and permanent injuries from the skull fractures, the parents allege. They are seeking more than $15 million for future medical expenses.

The case had been set for trial last September, but both sides agreed to hold off for two years because the cost of likely medical expenses over the course of the child's life are highly contested and, at his very young age, it's hard to determine the extent of his brain injury. Allowing the child to develop and see how he progresses will help medical experts better gauge the potential future cost of his care, according to the opinion from U.S. District Judge Sylvia Rambo of the Middle District of Pennsylvania. “It's the first time in 31 years of practicing that I've asked a judge to put off a trial,” said Shanin Specter, of Kline & Specter in Philadelphia. Specter is representing the parents, Christina Late and Nathan Armolt, along with Regan Safier.

After the judge agreed with the parties that holding off on the trial made sense, the government filed a motion asking the court to limit its potential liability to $100,000. It argued that reading the federal law, the FTCA, together with the state law, the Medical Care Availability and Reduction of Error Act (MCARE), the amount of future medical expenses it could face paying would be capped at $100,000.

Rambo disagreed. She looked to precedent set in other circuits because the U.S. Court of Appeals for the Third Circuit hasn't yet spoken on this precise issue.

Under the terms of the FTCA, state law governs the liability in cases like this one, Rambo said. In Pennsylvania, that law is MCARE, which states that any amount over $100,000 is to be doled out in “periodic payments.” Any amount less than $100,000 can be awarded in a lump sum. For amounts larger than that, the judge has to determine the amount of damages by year and the money is paid out on that schedule. “Pursuant to the 'like circumstances' requirement of the FTCA, it would appear that, under Pennsylvania law, the United States should provide funding for periodic payments of a future medical expenses award in excess of $100,000 by means of an annuity contract, trust or other qualified funding plan,” Rambo said.

However, the government cited the Third Circuit's 1972 decision in Frankel v. Heym , arguing that the circuit court's ruling there prohibits any judgment other than a lump sum, so the limit of the government's liability would be the ceiling for lump-sum payments under MCARE ' $100,000. “The United States' argument is unavailing,” Rambo said. “Even assuming that funding the periodic payments by an annuity contract, trust or other qualified funding plan involves something other than a lump-sum payment, the court finds that it is authorized to craft a judgment in excess of $100,000 against the United States in order to comply with the MCARE Act.”

In Frankel, which was decided before MCARE was enacted, the Third Circuit rejected a proposal to establish a reversionary trust for the future medical damages awarded to a disabled plaintiff. “The Third Circuit concluded that 'district court[s] should not make other than lump-sum money judgments' in FTCA cases,” Rambo said, quoting from Frankel. “Unlike the proposed reversionary trust in Frankel, Pennsylvania's periodic payment scheme would not subject the United States to ongoing obligations in violation of the FTCA,” Rambo said, explaining that MCARE requires that the amount due for each year be calculated.

The judge then looked to the Fifth, Ninth and Tenth circuits for their interpretations of similarly styled state laws with the FTCA. “Because the MCARE Act does not require the liable party to make payments to the plaintiff on an as-incurred basis, the court finds that it is not prohibited from ordering the United States to make a one-time payment to provide funding for the periodic payment of a future medical expenses award by means of an annuity contract, trust or other qualified funding plan in accordance with Pennsylvania law,” Rambo said. ' Saranac Hale Spencer, The Legal Intelligencer

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Judge Clears Up Intersection of MCARE, Tort Claims Act

The federal government could end up paying millions of dollars in a medical malpractice suit, just as a privately funded hospital would, a federal judge has ruled in a case that clarifies how state and federal law intersect on the issue.

The parents of a baby born in a federally funded hospital filed suit against the government under the Federal Tort Claims Act, which lifts the government's sovereign immunity and allows people to sue, because the doctor who handled the delivery fractured the baby's skull by improperly using forceps. The child, now two years old, has severe and permanent injuries from the skull fractures, the parents allege. They are seeking more than $15 million for future medical expenses.

The case had been set for trial last September, but both sides agreed to hold off for two years because the cost of likely medical expenses over the course of the child's life are highly contested and, at his very young age, it's hard to determine the extent of his brain injury. Allowing the child to develop and see how he progresses will help medical experts better gauge the potential future cost of his care, according to the opinion from U.S. District Judge Sylvia Rambo of the Middle District of Pennsylvania. “It's the first time in 31 years of practicing that I've asked a judge to put off a trial,” said Shanin Specter, of Kline & Specter in Philadelphia. Specter is representing the parents, Christina Late and Nathan Armolt, along with Regan Safier.

After the judge agreed with the parties that holding off on the trial made sense, the government filed a motion asking the court to limit its potential liability to $100,000. It argued that reading the federal law, the FTCA, together with the state law, the Medical Care Availability and Reduction of Error Act (MCARE), the amount of future medical expenses it could face paying would be capped at $100,000.

Rambo disagreed. She looked to precedent set in other circuits because the U.S. Court of Appeals for the Third Circuit hasn't yet spoken on this precise issue.

Under the terms of the FTCA, state law governs the liability in cases like this one, Rambo said. In Pennsylvania, that law is MCARE, which states that any amount over $100,000 is to be doled out in “periodic payments.” Any amount less than $100,000 can be awarded in a lump sum. For amounts larger than that, the judge has to determine the amount of damages by year and the money is paid out on that schedule. “Pursuant to the 'like circumstances' requirement of the FTCA, it would appear that, under Pennsylvania law, the United States should provide funding for periodic payments of a future medical expenses award in excess of $100,000 by means of an annuity contract, trust or other qualified funding plan,” Rambo said.

However, the government cited the Third Circuit's 1972 decision in Frankel v. Heym , arguing that the circuit court's ruling there prohibits any judgment other than a lump sum, so the limit of the government's liability would be the ceiling for lump-sum payments under MCARE ' $100,000. “The United States' argument is unavailing,” Rambo said. “Even assuming that funding the periodic payments by an annuity contract, trust or other qualified funding plan involves something other than a lump-sum payment, the court finds that it is authorized to craft a judgment in excess of $100,000 against the United States in order to comply with the MCARE Act.”

In Frankel, which was decided before MCARE was enacted, the Third Circuit rejected a proposal to establish a reversionary trust for the future medical damages awarded to a disabled plaintiff. “The Third Circuit concluded that 'district court[s] should not make other than lump-sum money judgments' in FTCA cases,” Rambo said, quoting from Frankel. “Unlike the proposed reversionary trust in Frankel, Pennsylvania's periodic payment scheme would not subject the United States to ongoing obligations in violation of the FTCA,” Rambo said, explaining that MCARE requires that the amount due for each year be calculated.

The judge then looked to the Fifth, Ninth and Tenth circuits for their interpretations of similarly styled state laws with the FTCA. “Because the MCARE Act does not require the liable party to make payments to the plaintiff on an as-incurred basis, the court finds that it is not prohibited from ordering the United States to make a one-time payment to provide funding for the periodic payment of a future medical expenses award by means of an annuity contract, trust or other qualified funding plan in accordance with Pennsylvania law,” Rambo said. ' Saranac Hale Spencer, The Legal Intelligencer

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