Medical malpractice lawsuits can be scary for physicians. There are lots of reasons why, but high on the list is the fact that most of us know very little about the process. Excellent med mal defense lawyers know the process well, however, and have a variety of tools for navigating towards the best possible outcome, one being the high-low agreement. What is a high-low agreement?
How Med Mal Lawsuits Resolve
As I’ve mentioned before, medical malpractice lawsuits can resolve in a variety of ways. Some are dropped, some are settled, a few are mediated, and a minority -- about 10% -- result in a trial before a jury. Those which go to trial often involve two opposing forces:
A physician or healthcare entity who believes their work was appropriate and met the standard of care, and
A plaintiff whose loss or complication was an important one.
If either one of those is not true, the case will likely resolve by some other mechanism.
Once trial becomes an eventuality, even physicians who are absolutely confident in the care they provided sometimes fear that a jury may find in the favor of the plaintiff and recommend a large award. These physician-defendants may even worry that an award may exceed their medical malpractice policy limits and put their personal assets at risk. If you are among those physicians, I would first like to reassure you that defense attorneys I know with decades of experience in highly litigious places say that they have never seen that happen first-hand. (Read more about asset protection here.)
And second, I’d like for you to know what a high-low agreement is, in case this information becomes relevant to you.
What is a High-Low Agreement?
A high-low agreement is, in some ways, one step away from a settlement. In a settlement, the two parties -- the patient or family who have filed the suit and the physician or healthcare entity named in it -- negotiate agreement on a fixed sum of money which will be paid to the plaintiff in relation to their loss or complication. (Read more about settlement here.)
If they cannot reach agreement for any reason and will go to trial, the two parties sometimes craft a high-low agreement. This is a contract in which the defendant agrees to pay the plaintiff a minimum dollar amount -- even if the jury rules for the defense -- in return for the plaintiff’s agreeing to accept a fixed maximum amount -- even if the jury rules in the plaintiff’s favor. In other words, the plaintiff is assured some monetary award while the defendant is assured that a monetary award will go no higher than an agreed upon sum.
NOTE: If you are involved in a high-low agreement, your lawyer may very well tell you that it is entirely confidential. If that is the case, it is crucial that you PRESERVE that confidentiality scrupulously!
Benefits to Physicians
A high-low agreement provides some protection to both parties and, in the right context, can be a win-win. Obviously, this contractual arrangement provides assurance that no payout will exceed a fixed amount, regardless of the verdict.
Additionally, there are instances where a physician who feels confident that their care was appropriate may still feel glad to know that a small sum of money will help cover the medical bills or other expenses of a patient who has suffered a loss.
And finally, where a jury rules in the physician-defendant’s favor, that monetary payment is not considered to be a settlement, and therefore may not be reportable to the National Practitioner Data Bank.
As always, please remember that I am a physician-colleague and not a lawyer. I encourage you to reach out to your experienced medical malpractice defense lawyer or your insurance claims manager if you are wondering about whether a high-low agreement might be an appropriate path for you.