A published report in 2006 from the Harvard School of Public Health found that 61 of medical malpractice lawsuits are settled out of court rather than litigated in a trial. This is a sharp contrast from most general litigation, where 80 to 90 percent of cases never reach trial. Malpractice cases have fewer settlements primarily because defendants often prevail in medical malpractice suits, and many of the plaintiffs who win recover little or no money.
Furthermore, many malpractice insurance companies require their insured doctors to stand trial if accused of medical malpractice and to deny liability through settlements. This additional duty also affects settlement rates in the medical malpractice field.
Out-of-court settlements usually happen late in the lifespan of a medical malpractice lawsuit. Often, medical malpractice cases must go through the point of both parties filing motions and completing the discovery process before meaningful settlement discussions can occur. The information gleaned from the motions, discovery responses and the bench’s rulings on those preliminary motions is a helpful gauge to both counsel.
A medical malpractice plaintiff's counsel tries to strike an appropriate balance between obtaining quick settlement payments for plaintiffs and ensuring that the settlement amounts are fair and reasonable. Counsel must avoid the temptation to settle a case extremely promptly for a cheap or lower amount than is warranted by the facts of the case. Additionally, even in the cases where plaintiffs prevail at trial, the awards given to the plaintiffs may be higher than the settlement amounts contemplated but still lower than the plaintiffs’ estimates of their level of damages.
Of course, plaintiffs also run the risk of recovering nothing, as medical malpractice cases are often decided in favor of the defense (seemingly far more often than in other types of personal injury litigation). Finally, the time required to take a case to trial and exhaust appeals can span several years, and some litigants may not want to wait that long for their payout. It may be that they are willing to take less money in exchange for bringing the matter to a close more quickly.