Understanding the Role of Arbitration in Florida Medical Malpractice Cases

When a patient intends to bring a medical malpractice lawsuit under Florida law, the health care provider (or his insurance company) can make an “an offer to arbitrate in which liability is deemed admitted and arbitration will be held only on the issue of damages.” In some cases, arbitration offers a quicker and less costly resolution to a malpractice claim than traditional litigation. However, a patient should always proceed with caution, as agreeing to arbitration means waiving certain due process rights. That is to say, if you agree to arbitration and dislike the outcome, you cannot then file a malpractice lawsuit in state court.

Surgeon Sues Insurer Following $33M Arbitration Award

One thing to note is Florida’s arbitration law allows the provider or insurer to make an arbitration offer “contingent upon a limit of general damages.” This means you run the risk of recovering less with an arbitration than a trial jury. But there are cases where the arbitration is not contingent on a damages limit, and the victims actually benefit.

Here is a recent example. In 2004, a plastic surgeon in Jacksonville performed a liposuction on a 32-year-old male patient. A few hours after the procedure, the patient went into cardiac arrest and died. An autopsy determined the cause of death was “respiratory insufficiency due to complications of liposuction.”

The plastic surgeon’s malpractice insurer conducted an investigation, determined the “case was indefensible” with respect to liability, and offered to settle with the victim’s estate for $250,000, the limit of the insurance policy. The insurer also offered to arbitrate on the issue of damages without setting a maximum limit. The estate jumped at the chance to arbitrate, believing it would receive far more than the $250,000 policy limit.

The estate proved to be right. An arbitration panel ultimately awarded the estate over $33 million. A Florida appeals court affirmed the award in a 2010 order.

This proved, however, not to be the end of the matter. The plastic surgeon subsequently sued his insurance company, alleging it acted in “bad faith” when it offered to submit the estate’s damages claim to arbitration without specifying a limit. The surgeon argues the insurer failed to “advise him fully of the consequences of admitting legal liability” and the company acted in its own best interest, not his, when it decided to arbitrate.

This lawsuit remains pending. Recently a Florida appeals court reversed a lower court’s decision to grant summary judgment to the insurance company. The appeals court said a “jury could find” the insurer unilaterally made the decision to arbitrate against the interests of its client.

Need Help With a Malpractice Claim?

While arbitration worked out well for the victim’s estate in this case (if not the doctor or his malpractice insurer), that does not mean arbitration is appropriate in every circumstance. If you have been the victim of medical malpractice, you should never agree to binding arbitration without first consulting an experienced Clearwater personal injury attorney. Contact the Law Office of Paul B. Genet, P.A., today if you would like to speak with an attorney right away.