Wisconsin Supreme Court Affirms $750,000 Cap on Noneconomic Damages in Medical Malpractice as Constitutional

Wisconsin Supreme Court Affirms $750,000 Cap on Noneconomic Damages in Medical Malpractice as Constitutional

Introduction

In the landmark case of Ascaris Mayo and Antonio Mayo v. United Healthcare Insurance Company and Wisconsin State Department of Health Services, the Supreme Court of Wisconsin addressed the constitutionality of a legislatively-enacted cap on noneconomic damages in medical malpractice cases. The plaintiffs, Ascaris and Antonio Mayo, challenged the $750,000 cap imposed by Wisconsin Statutes § 893.55, arguing that it violated their constitutional rights under equal protection and due process. This case revisits and overturns the precedent set by the 2005 decision in Ferdon ex rel. Petrucelli v. Wisconsin Patients Compensation Fund, which had previously deemed a similar cap unconstitutional.

Summary of the Judgment

The plaintiffs, Mayos, endured severe medical malpractice resulting in the amputation of all four limbs of Ascaris Mayo. A jury awarded them $8,842,096 in economic damages and an unprecedented $15,000,000 in noneconomic damages. However, Wisconsin Statutes § 893.55 mandated a cap of $750,000 on noneconomic damages, significantly reducing the plaintiffs' total award. The lower courts found this cap unconstitutional, citing the Ferdon decision.

Upon reaching the Supreme Court of Wisconsin, the court re-evaluated the cap under the rational basis standard of review. The majority concluded that the $750,000 cap is constitutional both facially and as applied to the Mayos. Consequently, the court reversed the court of appeals' decision and overruled the Ferdon precedent, reinstating the cap as a valid legislative measure.

Analysis

Precedents Cited

The Ferdon case, decided in 2005, was pivotal in shaping the legal landscape surrounding caps on noneconomic damages in Wisconsin. In Ferdon ex rel. Petrucelli v. Wisconsin Patients Compensation Fund, the court struck down a $350,000 cap, deeming it unconstitutional under equal protection and due process grounds. This decision underscored the vulnerability of severely injured plaintiffs in medical malpractice cases.

Additionally, the court referenced several foundational cases to establish the standard of review, including:

  • Milwaukee Branch of NAACP v. Walker (2014) – Discussed the standards for facial and as-applied constitutional challenges.
  • League of Women Voters of Wis. Educ. Network, Inc. v. Walker (2014) – Elaborated on facial and as-applied challenges.
  • SOCIETY INS. v. LIRC (2010) – Addressed independent review standards for constitutional challenges.
  • Marbury v. Madison (1803) – Established the principle of judicial review.

By overruling Ferdon, the court shifted the precedent, allowing for higher caps on noneconomic damages in medical malpractice cases, provided they meet the rational basis test.

Legal Reasoning

The court employed the rational basis review to assess the statute's constitutionality, a deferential standard typically used for economic regulations that do not implicate fundamental rights or suspect classifications. The majority found that:

  • The cap serves legitimate legislative objectives, including controlling health care costs, preventing the practice of defensive medicine, and maintaining the financial integrity of the compensation fund.
  • The classification differentiates between plaintiffs based on the amount of noneconomic damages awarded, which is a substantial and rational basis for such a distinction.
  • The cap applies uniformly to all claimants, ensuring equal treatment under the law.
  • The legislature conducted thorough investigations and provided empirical evidence supporting the cap's efficacy in achieving its goals.

The court criticized the Ferdon decision for introducing an undefined intermediate level of scrutiny, termed "rational basis with teeth," which lacked clear standards and infringed upon the legislature's policymaking powers. By overruling Ferdon, the court reaffirmed the appropriateness of the traditional rational basis approach.

Impact

This judgment has significant implications for medical malpractice litigation in Wisconsin:

  • Legal Precedent: Overruling Ferdon sets a new standard, allowing higher caps on noneconomic damages as long as they pass rational basis scrutiny.
  • Healthcare Costs: By upholding the cap, the legislature's aim to control healthcare costs and maintain affordable malpractice insurance premiums is reinforced.
  • Judicial Deference: The decision underscores the judiciary's respect for legislative policy choices in economic regulation, limiting judicial intervention in such matters.
  • Future Litigation: Plaintiffs in future medical malpractice cases will face the statutory cap, influencing settlement negotiations and jury deliberations.

Complex Concepts Simplified

Rational Basis Review

Rational Basis Review is the most lenient level of judicial scrutiny applied by courts when evaluating the constitutionality of a statute. Under this standard, a law is presumed constitutional, and the burden of proof lies with the challenger to demonstrate that the law lacks any reasonable justification. The legislature's action will be upheld if it is rationally related to a legitimate government interest.

Facial vs. As-Applied Challenges

Facial Challenge: Claims that a statute is unconstitutional in all its applications. The challenger must prove that there is no scenario in which the law is valid.
As-Applied Challenge: Claims that a statute is unconstitutional in a specific situation or as it applies to a particular individual. The challenger must demonstrate that the law adversely affects them in a specific instance.

Noneconomic Damages

Noneconomic Damages refer to compensation awarded for intangible losses suffered by the plaintiff, such as pain and suffering, emotional distress, loss of companionship, and reduced quality of life, as opposed to tangible economic losses like medical bills or lost wages.

Caps on Damages

Caps on Damages are legislative limits placed on the maximum amount of damages a plaintiff can receive in a lawsuit. In medical malpractice cases, caps on noneconomic damages are intended to control the financial exposure of healthcare providers and insurance companies.

Conclusion

The Supreme Court of Wisconsin's decision in Mayo v. Wisconsin Injured Patients and Families Compensation Fund marks a pivotal moment in the state's approach to medical malpractice litigation. By affirming the $750,000 cap on noneconomic damages under rational basis review and overruling the precedent set by Ferdon, the court has reinforced the legislature’s authority to regulate healthcare costs and malpractice liabilities. While this decision favors maintaining stable healthcare costs and predictable insurance premiums, it raises concerns about the adequacy of compensation for plaintiffs who suffer catastrophic injuries. Moving forward, this judgment will shape the balance between protecting healthcare providers and ensuring fair compensation for victims of medical negligence in Wisconsin.

Case Details

Year: 2018
Court: Supreme Court of Wisconsin.

Judge(s)

PATIENCE DRAKE ROGGENSACK, C.J.

Attorney(S)

For the defendant-appellant-cross-respondent-petitioner, there were briefs filed by Kevin M. St. John, Roisin H. Bell, John N. Giftos, and Bell Giftos St. John LLC, Madison. There was an oral argument by Kevin M. St. John. For the plaintiffs-respondents-cross-appellants, there was a brief filed by Susan R. Tyndall, Daniel A. Rottier, James M. Fergal, and Habush Habush & Rottier, S.C., Madison. There was an oral argument by Daniel A. Rottier. An amicus curiae brief was filed on behalf of the Wisconsin Academy of Family Physicians, the Wisconsin Academy of Ophthalmology, Inc., the Wisconsin Chapter of the American College of Emergency Physicians, Inc., the Wisconsin Orthopaedic Society, the Wisconsin Psychiatric Association, Inc., the Wisconsin Radiological Society, Inc., the Wisconsin Society of Anesthesiologists, Inc., and the Wisconsin Society of Plastic Surgeons, Inc. by Guy DuBeau and Axley Brynelson, LLP, Madison. An amicus curiae brief was filed on behalf of the State of Wisconsin by Misha Tseytlin, solicitor general, Brad D. Schimel, attorney general, and Amy C. Miller, assistant solicitor general. There was an oral argument by Misha Tseytlin, solicitor general. An amicus curiae brief was filed on behalf of Wisconsin Hospital Association by Sara J. MacCarthy, Timothy W. Feeley, and Hall, Render, Killian, Heath & Lyman, P.C., Milwaukee. An amicus curiae brief was filed on behalf of Wisconsin Medical Society and American Medical Association Litigation Center by Anne Berleman Kearney and Appellate Consulting Group, Milwaukee. An amicus curiae brief was filed on behalf of The Physician Insurers Association of America by Samuel J. Leib, Brent A. Simerson, Brenden M. Leib, and Leib Knott Gaynor LLC, Milwaukee. An amicus curiae brief was filed on behalf of Wisconsin Manufacturers and Commerce by Lucas T. Vebber, Corydon J. Fish, and Wisconsin Manufacturers and Commerce, Madison. An amicus curiae brief was filed on behalf of the Wisconsin Association for Justice by William C. Gleisner, III and Law Offices of William Gleisner, Brookfield, with whom on the brief were J. Michael End and End, Hierseman & Crain, LLC, Milwaukee. An amicus curiae brief was filed on behalf of Wisconsin Defense Counsel by Justin F. Wallace and Nash, Spindler, Grimstad, & McCracken, LLP, Manitowoc, with whom on the brief were Monte E. Weiss, Charles W. Kramer, and Weiss Law Office SC, Mequon. An amicus curiae brief was filed on behalf of the American Tort Reform Association, the Wisconsin Civil Justice Council, the National Federation of Independent Business, the Chamber of Commerce of the United States, and the Wisconsin Insurance Alliance by James A. Friedman, Bryan J. Cahill, and Godfrey & Kahn, S.C., Madison.

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