New York limits an attorneys medical malpractice contingent fee in a medical, dental or podiatric malpractice case to 30 percent of the first $ 250,000 of the sum recovered; 25 percent of the next $ 250,000 recovered; 20 percent of the next $ 500,000 recovered; 15 percent of the next $ 250,000 of the sum recovered; 10 percent of any amount recovered over $ 1,250,000.
While contingency fees vary from malpractice lawyer to malpractice lawyer, 40% is a common fee in medical malpractice cases. So if a case settles or the plaintiff obtains a verdict for $1,000,000, the attorneys’ fees in many cases is $400,000. In New York, when a malpractice case recovers $1,000,000, the malpractice lawyer’s fee is limited to $225,000.
If you are not a malpractice lawyer, you might be thinking that this is not a bad payday for a single case. You are right. But the problem is that plaintiffs’ medical malpractice lawyers lose most cases. When a lawyer loses a case, he might lose $100,000 or more in out-of-pocket costs. This discourages many good lawyers from handling medical malpractice cases.
Because doctors and their insurance companies are not limited in what they spend on their lawyers, this creates an unbalanced playing field that favors doctors. Victims with legitimate malpractice claims suffer as a result. Good lawyers just find more lucrative cases.
It is easy to pass this kind of legislation because it appears to target the ostensibly already rich trial lawyers. But the reality is that victims with limited claims are the real losers.