AIA: Wis. Supreme Court Ruling Disturbing

In what the American Insurance Association (AIA) called a disturbing ruling, the Wisconsin Supreme Court has declared that the state’s inflation-indexed cap on non-economic damages in medical malpractice cases is unconstitutional.

“The court’s ruling is confusing and will likely cause disruption in what is one of the country’s few stable medical malpractice insurance markets,” said Steve Schneider, AIA vice president, Midwest Region.

“We find it troubling that after ruling unanimously last year that the cap on non-economic damages for wrongful death was constitutional, the court now declares the same type of cap unconstitutional in medical malpractice cases,” Schneider continued. “The court went so far as to hold that there is ‘no rational basis’ underlying the legislative intent of caps, which is to preserve the viability of the health care and medical liability insurance systems. Such ambiguity and disregard for broader systemic issues leaves insurers, doctors and patients all scratching their heads.”

In a scathing dissent, Justice David Prosser, Jr. writes “[T]his court is not meant to function as a ‘super-legislature’ constantly second-guessing the policy choices made by the legislature and governor. Today, a majority of this court utilizes several unacceptable tactics to invalidate a legislative act.” He goes on to state that the decision “is effectively destroying the checks and balances in our constitutional system” by preventing a possible response from the legislature and review by the U.S. Supreme Court.

The ruling comes in the case of Matthew Ferdon v. Wisconsin Patients Compensation Fund, 2003AP988. The $350,000 cap on non-economic damages in Wisconsinwas established in 1995 and is indexed for inflation. It currently stands at $445,775.