Wisconsin $1.2B Medical Malpractice Fund Has $783M Surplus

162017_132140396847214_292624_nA state audit of the Wisconsin Injured Patients and Families Compensation Fund (“Fund”) reported in March that the Fund has a balance of $1.2 billion, which represents a surplus of $783 million in the Fund (the recommended range for the Fund is $86.4 million to $376.6 million).

What Is The Fund?

The Injured Patients and Families Compensation Fund insures health care providers in Wisconsin against medical malpractice claims that exceed the primary malpractice insurance thresholds established in Wisconsin statutes (most health care providers that operate or have permanent practices in Wisconsin are required to maintain primary medical malpractice coverage of $1 million for each incident and $3 million per policy year and are required to participate in the Fund, which provides unlimited secondary medical malpractice coverage for economic damages that exceed the primary medical malpractice coverage). The Fund is overseen by a Board of Governors and is administered by the Office of the Commissioner of Insurance (“OCI”).

The Wisconsin Legislative Audit Bureau reported that the Fund had 16,140 individual health care providers, institutions, and other entities participating in the Fund as of June 30, 2015; from the inception of the Fund in 1975 through June 30, 2015, the Fund had paid $855.3 million for 672 medical malpractice claims; the Fund’s estimated total loss liabilities declined from $721.1 million as of June 30, 2010 to $486.0 million as of June 30, 2015; during the audit period, the Fund’s net position increased from $445.0 million (as of July 1, 2012) to $733.9 million (as of June 30, 2015), which increase was due, in part, to reductions in the actuarial estimates for loss liabilities and improvements in the investment markets; the actuary recommended in October 2015 a target range for the net position of the Fund between approximately $86.4 million and $376.6 million; and, as of September 30, 2015, the Fund’s unaudited net position was $783.0 million, which was $406.4 million above the targeted maximum net position.

Despite decreased assessment rates over the last several years (for Fiscal Year 2015-2016, provider assessment rates decreased by 34%), the balance of the Fund continues to grow.

Source 

Why Is The Fund Bloated?

One possible explanation is that Wisconsin has limited (capped) noneconomic damages in medical malpractice claims to $750,000 since April 6, 2006.

National Practitioner Bank data indicates that Wisconsin ranked 49th among states in medical malpractice payments per capita from 2004 through 2014. Wisconsin is among only a few states that does not permit adult children to recover damages in the event that medical malpractice causes a parent’s death. And Wisconsin does not permit the parents of adult children to sue for medical malpractice if their adult children die as a result of medical malpractice.

If you or a family member suffered serious injuries as a result of medical malpractice in Wisconsin or in another U.S. state, you should promptly consult with a Wisconsin medical malpractice attorney or a medical malpractice attorney in your state who may investigate your medical negligence claim for you and represent you in a medical malpractice case, if appropriate.

Click here to visit our website or call us toll-free at 800-295-3959 to be connected with Wisconsin medical malpractice lawyers (or malpractice lawyers in your state) who may assist you.

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This entry was posted on Wednesday, April 13th, 2016 at 5:06 am. Both comments and pings are currently closed.

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