Often in mediation we are faced with the dilemma of putting a dollar amount on personal injuries and pain and suffering that are difficult to estimate. How do you value the loss of a limb? How do you value the loss of cognitive abilities? In a wrongful death matter, how do you value a person’s life?
The United States District Court for the Eastern District of Missouri has given us a formula to use in personal injury cases in at least two rulings. In Vardiman v US, No. 4:1/7- cv-02358 (Oct. 28, 2021) a vehicle driven by a representative of Defendant on an Interstate crashed into Plaintiff’s large vehicle injuring the driver and all five passengers to varying degrees. Each plaintiff presented to the Court their medical expenses billed, as well as the amounts actually paid or still outstanding. As is usually the case, the medical bills actually paid or still outstanding were significantly less than those billed.
According to Missouri Revised Statute, Section 490.715 a Plaintiff seeking special damages for medical expenses “may introduce evidence of the actual cost of the medical care or treatment rendered to plaintiff or a patient whose care is at issue. Actual cost of the medical care or treatment shall be reasonable, necessary and a proximate result of the negligence or fault of any party.”
One rule of thumb used by attorneys and insurance adjusters was to compensate plaintiffs for pain and suffering equal to three times the amount of the medical expenses. This general rule is ignored more than it is followed but I hear it quoted many times in mediations. The court in Vardiman ruled that two times, not three times the medical expenses, were adequate to compensate plaintiff for all pain and suffering. The court declined to award any monetary relief for future medical expenses despite some testimony that future medical expenses were likely.
In a subsequent case, Fahrenbach v US, No. 4:2O-cv-01056 (Sept. 6, 2022) a postal carrier, while driving a postal vehicle, crashed into a privately owned vehicle injuring Plaintiff. The court awarded Plaintiff the actual costs of medical care not the amount charged for the medical care and two times the medical expenses for her pain and suffering. The Court declined to award any future medical expenses finding that the possibility of future surgery was too speculative.
In my mediations I remind the parties that there is no exact formula for calculating these more nebulous amounts. However, it is helpful to point out as a guidepost what the federal courts are doing. I look forward to our next mediation.
