MOST CLAIMS SETTLE: IMPLICATIONS FOR ALTERNATIVE DISPUTE RESOLUTION FROM A PROFILE OF MEDICAL-MALPRACTICE CLAIMS IN FLORIDA

Mirya Holman, Neil Vidmar, Paul Lee
unpublished
I INTRODUCTION Past research on the nature and scope of medical-malpractice claims in Florida has found that a very high number of cases are resolved before trial, and, conversely, a very low number of cases are resolved through jury trials. A general survey of the process of medical-malpractice claims resolution in Florida between 1990 and 2003 reveals that 45% of claims resulted in payments, 46% of paid claims were closed in three years, and 96% were closed in six years. 1 Moreover, 20% of
more » ... d claims were settled without a lawsuit ever being filed, and only 2.3% of paid claims were resolved following a jury trial. Out of all awards equal to or exceeding one million dollars, approximately 10% were made without a plaintiff ever filing a formal lawsuit, compared to less than 5% of cases resolved through jury trial. 2 Numerous researchers have studied when parties in a legal dispute go to trial and when they settle out of court. 3 These investigations-which often use the Pareto notion of equality 4 tested with game-theoretic models-have focused on the strategic decision-making elements of pretrial settlements. These studies have found that each party's level of information, as well as the rules of the game, affect the likelihood of settlement. 5 The few studies that have used real data to examine settlement rates have found very high pretrial-settlement rates. 6 The dynamics behind these resolution rates-whether they are milliondollar cases, lesser awards, or claims without awards-should be considered in the context of the discovery and procedural rules guiding the claiming process. A study of closed-claim files of major medical-liability insurers clearly demonstrates the importance of the discovery process in resolving claims. 7 Before claims can be settled, both parties need to uncover the facts bearing on the dispute, including both the determination of causality and the presence of legal negligence. Today, a patient in a hospital is often treated by multiple specialists, resident physicians, nurses, and technicians. At the beginning of a claim, no one may know if, which, and how many of these persons might have been negligent. 8 The formal process of discovery can be difficult and timeconsuming, and undoubtedly is a primary cause of delay in the settlement of most disputes. see also Ben DePoorter, Law in the Shadow of Bargaining: The Precedent Effect of Settlement, 95 CORNELL L. REV. 957, 987 (2010) (discussing informal networking among lawyers regarding the "going rates" of private settlements and their use in private negotiations); Howard et al., supra note 3, at 433 (discussing the role of fairness in settlements). 6. Vidmar et al., Uncovering, supra note 1, at 355; Vidmar et al., Million Dollar, supra note 2, at 1345. This finding is also consistent with the disappearing-trial phenomenon, which has found that the rate of trials for civil cases is approaching zero. See Gillian K. Hadfield, Where Have All the Trials Gone? Settlements, Nontrial Adjudications, and Statistical Artifacts in the Changing Disposition of Federal Civil Cases, 1 J. EMPIRICAL LEGAL STUD. 705, 705 (2004) (finding that the rate of settlement has declined, but that the rate of nontrial adjudication has increased, which is consistent with some of the pretrial mechanisms presented in this research); see also Herbert M. Kritzer, Disappearing Trials?
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