Contrary to popular belief, medical malpractice insurance does not insulate a physician against personal financial exposure. In fact, most doctors in Florida only carry $250,000 in coverage when the malpractice verdicts commonly exceed $1,000,000. You can do the math yourself. Personal counsel can assist a physician by providing legal advice to best protect a physician against personal exposure when the damages of a case threaten to exceed the limits of the malpractice insurance policy.
A recent wrongful death lawsuit against a doctor in Palm Beach county demonstrates just how important personal counsel can be. In 2015, a plaintiff filed a medical malpractice case against Dr. B.C., a Board Board-Certified Orthopedic Surgeon. The plaintiff claimed that Dr. B.C. negligently allowed his patient to resume a medication, Evista, following foot surgery. The patient developed a DVT and pulmonary embolus which caused her death. The patient was 60 years old. The plaintiff claims that the death was caused by Dr. B.C.’s negligence and filed suit against him.
Dr. B.C. properly forwarded the lawsuit to his insurance carrier and the carrier appointed counsel to defend his case. Dr. B.C., like most doctors would in situation, probably thought he was protected because he carried a $250,000 insurance policy.
Early in the litigation the plaintiff offered to settle the entire case for $250,000.00, the policy limits, by sending the plaintiff a “Proposal For Settlement” (aka “PFS”). A PFS is a time sensitive demand that carries significant penalties if not timely accepted and the judgment turns out to be 25% greater than the offer. Had the insurance company timely accepted the offer, the carrier would be responsible to pay the claim, Dr. B.C. would owe nothing, and the case would have ended. Instead, the carrier rejected the offer.
After an 11-day trial, the jury found in favor of the plaintiff and returned a verdict for $1,475,232.00. The jury apportioned 57 percent liability to Dr. B.C. The Plaintiff also sought to collect his attorneys’ fees from the date of the settlement offer. The court issued a final judgment against Dr. B.C. in the amount of $668,604.79 plus attorney’s fees. The insurance company appealed and lost.
Dr. B.C. had an opportunity to settle the case for $250,000. Had he had personal counsel, the personal counsel could have advised Dr. B.C. of the risks involved in not accepting the PFS. More importantly, the personal counsel could have cautioned the insurance company that if they failed to timely settle the case, they would expose Dr. B.C. to increase risk. In some cases, courts have found insurance companies to be in “bad faith” by not accepting reasonable settlement offers and have forced the carrier to be responsible for the entire judgment, even if it exceeds policy limits.
Personal counsel may have prevented excess exposure against Dr. B.C. If you are named in a lawsuit, personal counsel will serve as a key advisor and make you aware of the risks you are taking. Personal counsel will assist the doctor in objectively assessing the defenses available and potential exposure at trial. Personal counsel does not work for the insurance carrier. Personal Counsel only advocates for the physician, doing his or her best to protect the physician from an adverse judgment in excess of policy limits.