A local appellate panel affirmed a $40.2 million jury verdict awarded to a 15-year-old boy who cannot walk because a chest surgery at Children's Hospital Los Angeles tore his heart.

Then the judges proceeded to pick the verdict apart.

They subtracted $7.1 million in pain and suffering and added $1.6 million in pre-trial interest. It also happened to be the second verdict in the case, since a $60 million award was thrown out due to poor jury instructions.

"It was very complex," said Steven Andrade, the Santa Barbara lawyer representing the boy. "They were out eight or nine days in the second trial to arrive at this verdict and spent four to five days just on liability."

Medical malpractice cases involve some of the most complex issues that jurors must understand to calculate damages. They must learn complex medical terms, special jury instructions and a host of rules and established practices specific to this type of litigation.

The damage calculations are at the center of a national debate about whether awards in medical malpractice cases should be capped in order to reduce the cost of insurance premiums for doctors. President Bush, who says such "junk" lawsuits create billions of dollars in health care costs, is proposing that Congress place a cap on pain and suffering damages in medical malpractice verdicts. Democrats contend that the caps would benefit insurance carriers and hurt injured plaintiffs.

The national debate has little immediate impact on California, which in 1975 imposed a cap of $250,000 on non-economic damages. The cap is among several rules outlined in the state's Medical Injury Compensation Reform Act, or MICRA, designed to reduce the damage awards in medical malpractice suits.

Wages, medical bills

But that doesn't mean California lacks disputes about how medical malpractice awards should be assessed.

With a limit on non-economic damages, sometimes referred to as "pain and suffering," "the firms that specialize in medical malpractice, and there are very few, can only really take cases where there are going to be long-term, future economic losses," said Daniel Zohar, a plaintiff's lawyer and partner at Heimberg & Zohar LLP.

Those losses, which include lost wages and medical bills, have become a central focus for California's plaintiff's lawyers, who are adept at using these experts to obtain economic damages.

"You've seen an increase in sophistication over time in what they chalkboard by way of damages," said Susan Penney, legal counsel at the California Medical Association. "For example, they didn't used to put in so many claims for future psychiatric care or future attendant care. Those were just the pain and suffering element of the case. Now, they're saying, 'How do we put this into an economic damage?'"

But convincing a jury to award economic damages has its challenges. Economists are hired as experts by both sides to estimate how much a person may have earned in wages had he not been injured, but the process can be difficult when the injured person is a child or young adult.

Plus, jurors are instructed to award damages only in extreme circumstances, since all doctors make mistakes. In addition to simply proving a doctor or nurse was negligent, a plaintiff's lawyer must show that it caused the injury and that the injury requires damages.

That's tough to get through to a jury, Zohar said.

In a recent case, he said he brought in other nurses and "stroke experts" to explain why a nurse's negligence in treating a 38-year-old man with a headache may have caused him to die from a stroke 24 hours later. The jury ruled there was negligence, but disagreed that it definitively caused the stroke. "It's an extremely challenging task for jurors to get their arms around these issues," Zohar said.

Jurors are not allowed to even know about the $250,000 cap. "I can't tell you how many times I've heard stories of jurors who work really hard, review all the evidence and deliberate to come up with a verdict, only to be told afterward the judge had to reduce it to $250,000 because of the cap," Zohar said.

And unlike most personal injury cases, jurors are not allowed to award to patients the costs of medical bills that were covered by their health insurance.

"There are so few doctors in California to provide money to pay judgments, so in order to make life more manageable on medical malpractice insurance companies, this statute requires general health insurance companies to carry some of that burden by not being able to get the money back they paid out to victims of medical malpractice," said Thomas Todd, a partner at Horvitz & Levy LLP who represents several associations in the medical industry.

Cardiac arrest case

The MICRA restrictions impacted the jury's award in the recent medical malpractice case involving the paralyzed boy.

The boy, Daniel Frasier, was six years old and living in Thousand Oaks when he was admitted to Children's Hospital for a cosmetic procedure on his chest, which appeared concave due to excess cartilage. Several hours after the primary surgeon, Dr. Bruce Hanson, sewed up the boy's chest and went home, Frasier went into cardiac arrest. By the time the doctors on duty discovered a torn aorta, Frasier's limited blood flow caused spinal cord and brain damage that left him with a lower IQ and unable to move from the chest down.

In 1999, the hospital and two doctors settled for more than $1 million, leaving only Hanson as the defendant.

The jury gave two verdicts. In the first, issued in 2000, the jury awarded more than $60 million in damages over the boy's lifetime and found Hanson 100 percent negligent. But an appellate panel threw out the award after finding that jurors did not follow their instructions.

The second verdict, issued in 2003, gave $40.2 million over the boy's lifetime and found the surgeon only 34.6 percent responsible. (The actual portion for future expenses, given its "present day value" and excluding interest or inflation, came to $5.2 million.)

The panel reduced a portion of the jury's award, $7.2 million in damages related to pain and suffering, to comply with the state's cap on non-economic damages but disagreed that the surgeon should not be responsible for $170,000 in costs that were paid for by the boy's health insurance. The carrier was the U.S. Navy and exempt from the restrictions in MICRA, the panel concluded.

Andrade, Frasier's lawyer, said the case was unusual because there were so many allegations made against so many people. But he agreed that many medical malpractice cases are far from simple.

"Are there slam-dunk cases? Of course," Zohar said. "I just got a call yesterday involving a surgery in San Diego where they operated on the wrong limb. They were supposed to do something on the right leg and operated on the left leg. You don't need to be a doctor to understand something's wrong here."

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