Louisiana

IV. State Case Studies

Louisiana

Louisiana’s Medical Malpractice Act (“LMMA”) was first introduced in 1975.[1] The Act created a voluntary patient compensation fund.[2] Originally, the LMMA placed a $500,000 limit on the award of damages. However, on September 27, 2006, the Third Circuit Court of Louisiana declared that the statutory cap on medical malpractice damages in the state was too low to properly compensate victims of medical malpractice.[3] The Court held that $500,000 was only $160,000 by today’s standards due to depreciation. The Court declined to set a new cap on damages and the decision was later vacated.[4] However, because of the decision and later legislation regarding the cap, Louisiana’s fund operate virtually without a cap.[5]

Louisiana’s fund is unique because it pays for future medical care necessitated by the medical malpractice.[6] In 1984, the Louisiana legislature determined that the $500,000 cap would not include future medical and related care.[7] Thus, the cap on the Louisiana fund, for practical purposes, is unlimited.[8] Since 1997, Louisiana has paid $290,181,6221.29 on claims over the statutory cap.[9] Additionally, judicial interest and court costs are outside of the cap.[10] With the judicial interest at 8% in Louisiana in 2006, judicial interest has been a significant drain on Louisiana’s fund.[11] In 2007, Louisiana’s PCF had 158 claims for which payments in excess of $1 million per month were made.[12] As a result, in 2007, the average requested rate increase for physicians paying into the fund was 11%.[13]

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[1] Sarah R. Levin, The Medical Malpractice System and the Payment of Future Medical Damages: On Life Support Elswhere, Resuscitated in Louisiana, Louisiana Law Review, 955, 964 (2008).

[2] Id.

[3] Arrington v. ER Physicians Group, APMC, 940 So. 2d 777, 781 (La.App. 2006), vacated, 947 So.2d 727 (La. 2007).

[4] Levin, supra note 100, at 964.

[5] Ken Schnauder, Payments Over and Above the Cap, LPCF Quarterly Vol 1, Issue 4. December 2006; Levin, supra note 100, at 964.

[6] Id. at 971.

[7] Ken Schnauder, supra note 104.

[8] Id.

[9] Id.

[10] Ken Schnauder, $100 Million Dollar Claims Budget, the Norm? LPCF Quarterly, Vol 1, Issue 3, July 2006.

[11] Id.

[12] Ken Schnauder, supra note 104.

[13] Lorraine LeBlanc, Rates, PCF Quarterly, Vol 1, Issue 3, July 2006.