What are Damage Caps and How Do They Affect My Case?

In very basic terms, a damages cap is an arbitrary limit on the total compensation that a plaintiff can recover for his or her injury in certain personal injury, medical malpractice and product liability lawsuits.

Damage caps have been imposed by some state legislatures to limit compensation to victims. These damage caps are typically presented as one of several ways to reform the tort system to reduce “frivolous lawsuits”, prevent “outrageous” plaintiff verdicts, keep insurance premiums (typically medical malpractice insurance) from spiraling out of control and causing a “doctor shortage”. The reality is that “tort reform” legislation such as damage caps has been shown to have little if any impact on reducing ‘frivolous lawsuits”, controlling medical malpractice insurance premiums or any other of the supposed “benefits”.

The truth is that all tort reform has been used as a political ploy by the Republican Party to hurt plaintiff trial lawyers who tend to support Democratic candidates. The only real victims of damage caps and other tort reform measures are innocent victims who are prevented from obtaining the full amount of the damages are awarded by a jury. In fact, some damage caps are so onerous that trial lawyers are reluctant to even take on a case knowing that they have virtually no upside.

Not all states impose damage caps.  Following is a list of states that have placed caps on medical malpractice damages:

  • Alaska
  • California
  • Colorado
  • Florida
  • Georgia
  • Hawaii
  • Idaho
  • Illinois
  • Indiana
  • Kansas
  • Louisiana
  • Maine
  • Maryland
  • Massachusetts
  • Michigan
  • Mississippi
  • Missouri
  • Montana
  • Nebraska
  • Nevada
  • New Jersey
  • New Mexico
  • North Carolina
  • North Dakota
  • Ohio
  • Oklahoma
  • Oregon
  • South Carolina
  • South Dakota
  • Tennessee
  • Texas
  • Utah
  • Virginia
  • West Virginia
  • Wisconsin

Theoretically, damage caps are supposed to protect doctors, businesses and insurance companies from paying injured victims high non-economic damage awards. Medical expenses and lost wages are not affected. Non-economic damages are harder to quantify and include the value of pain and suffering and mental anguish. For example, if you proved that a hospital is liable for injuries in court, a damage cap may limit the maximum amount of compensation you receive to $250,000 for non-economic damages. Damage caps still apply despite the context or extent of a case, which is to say that the judge and jury of a case cannot override any damage cap.

Judges and attorneys do not inform the jury of what the damage cap is for a case. By not informing the jury of what the damage cap is, the judge ensures that compensation is arrived upon by fair and uninfluenced reasoning. Although, if a jury comes to the reasonable conclusion that a plaintiff is entitled to certain damages, and that amount exceeds the state mandated damage cap, one must question whether it is fair that the plaintiff is paid less than jury awarded.

Often politicians will argue that if there is no damages cap, medical malpractice companies will increase premiums, doctors will charge more because of increased premiums, and patients will end up footing the bill. However, this domino effect has yet to be seen by the public. Healthcare cost is still on the rise along with health insurance, yet the American Society for Healthcare  Risk Management’s Hospital and Physician Professional Liability Benchmark Analysis reports that medical malpractice insurance for healthcare providers remains uniformly consistent. Furthermore, while the number of medical malpractice claims go down, the casualty rates of medical malpractice has gone up. A testimony given in a United States Senate hearing in 2014 confirmed that approximately 1,000 Americans die every day as a result of a preventable medical error.

Damage caps do not only apply to pain and suffering, and the loss of the enjoyment of life. Punitive damages that can be paid to a plaintiff are also restricted. Punitive damages are used to punish the defendant for the conscious disregard or indifference to the plaintiff’s safety (also known as “gross negligence”). The main reason that punitive damages are used, is to deter the wrongful behavior of the defendant in the future. Punitive damages can be worth far more than economic damages and are typically based on the defendant’s wealth. A punitive damages cap, however, will limit the amount of punishment deemed appropriate by a jury. Thus, punitive damage caps curtail the effort to stop large companies from disregarding the safety of consumers.

If you have been injured due to a medical provider’s negligence, consult with an experienced medical malpractice attorney to find out how much compensation you may be entitled to, and if a damage cap may apply.

Zac Pingle About Zac Pingle

Zac Pingle was born in Florida, and grew up in several places across the United States. From a young age, Zac developed a taste for writing, reading under trees and getting into trouble. Currently, Zac resides in Oregon as a college student where he aspires to become an English professor.