APMA News - September/October 2017 - 48

Coverage Corner
By Maggie McGee, JD, director of Compliance, PICA

Economic versus Non-Economic Damages:
What You Should Know
It is important to understand the difference between economic and non-economic damages
when making decisions about your malpractice
insurance. As with all laws, the precise definitions of these two terms vary by state.
Economic damages, referred to as special
damages in some jurisdictions, are the damages
most often associated with a medical malpractice
or health-care liability claim. Economic damages are
generally those that can be calculated with some degree of
certainty and are linked directly to monetary loss the plaintiff
experienced as a result of the defendant's alleged negligence.
Medical bills and expenses, both past and future, fit squarely
into this category. Also, past and future lost wages and earnings are other types of economic damages. These damages
also include loss of earning capacity. A plaintiff's current position and education can often be considered when determining future earning capacity. This calculation can be difficult
when the plaintiff is self-employed or unemployed at the
time of the injury, or when there is a claim wherein, but for

Credentials Certiﬁcates for
2018 House of Delegates

Report Book information will be provided
exclusively online. Online meeting information
is updated as soon as new information becomes
available. Please contact Stephanie Simmons
at srsimmons@apma.org with any questions
regarding the House of Delegates.

48 APMA News September/October 2017

This article is not intended to constitute legal advice or create an attorneyclient relationship, but is intended for general information only. An attorney
or other resource should be consulted regarding individual cases.

Contact PICA to learn more about medical professional
liability coverage speciﬁcally for podiatrists at www.pica
group.com or 800-251-5727.

Original gaavel graphic by Shutterstock/words+pictures.

Credentialing information for the 2018 House
of Delegates was recently mailed to component
association presidents and executive directors.
You are encouraged to return your credentials
certiﬁcates by early January. Certiﬁcates are
also available at www.apma.org/HOD. If you are
unable to accommodate this request, please
contact Janette Russell, executive assistant, at
301-581-9251 or jmrussell@apma.org.

the injury, the plaintiff would have had a high
higherpaying job. As a result of this assessment, seniors, children, and those who do not work outside the home have historically received lower
awards in this category than their counterparts
with higher-paying jobs.
Non-economic damages, or general damages,
refer to compensation that is subjective for nonmonetary losses such as pain and suffering, emotional
distress, disfigurement, loss of consortium, and loss of enjoyment of life. These damages do not have a clearly defined value, and each person sitting on a jury may assess the amount
attributed to the loss very differently. A plaintiff's attorney may
reference that the plaintiff is no longer able to engage in activities he or she once did-things like interacting with family
and participating in athletic activities and hobbies-in order
to assist a jury with assigning a value to non-economic damages. Just like in determining loss of future earnings, the particular circumstances around a plaintiff prior to an injury weigh
in the calculation of non-economic damages.
What does all of this information mean for you? States
that have non-economic damage caps have the potential of
lower settlements in medical malpractice cases. However,
economic damages can still lead to large settlement amounts
in some cases.
For example, assume the plaintiff in a medical malpractice
case is a 30-year-old warehouse manager making $80,000
annually. After the alleged negligence of a health-care provider,
the plaintiff is unable to work as a warehouse manager, and it
is estimated that his annual income will be reduced by 50
percent for the remainder of his life. Assuming he retires at age
65, the lost wages of this plaintiff are $1.4 million.
This stark example demonstrates how, even with a damage cap in place, a health-care provider can have a great deal
of exposure. It is important to understand these concepts
when making decisions about your limits of liability of malpractice coverage. The limits of liability you choose will be governed by your comfort level, the laws in your state of practice,
and the coverage afforded by your policy.
n

http://www.apma.org/HOD http://www.picagroup.com http://www.picagroup.com

Table of Contents for the Digital Edition of APMA News - September/October 2017