Provision in a financial agreement that contravenes the intent of the Medical Malpractice Act by limiting damages is void as against public policy.

Joseph Franks sought medical care and treatment from Dr. Bowers and his surgical group at North Florida Surgeons, P.A. Prior to undergoing surgery, Mr. Franks executed a financial agreement that contained a provision for arbitration. The arbitration provision contained a limitation of damages subheading, limiting non-economic damages to a maximum of $250,000 per incident, to be calculated on a percentage basis. However, there was no admission of liability provision in connection with the damages caps.

Following surgery, Mr. Franks experienced medical complications and later died as a result of a vein laceration that occurred during the surgical procedure. His wife brought suit against Dr. Bowers and his practice, who moved to compel arbitration in accordance with the provision for arbitration contained in the financial agreement. The motion to compel arbitration was granted at the trial level and upheld on appeal. However, the Florida Supreme Court quashed the appellate court’s decision and remanded for further proceedings, finding that the legislative purpose and public policy contained within the Medical Malpractice Act was eviscerated by the limitation of damages provision in the arbitration agreement. Specifically, the Court noted that the financial agreement required the parties to submit to arbitration, which did meet one of the stated goals of the Medical Malpractice Act, but eliminated the incentives provided by the Act for claimants to submit to arbitration by failing to include an admission of liability provision in connection with the damages caps. In its holding, the Court stated that the incentive provided to claimants to encourage arbitration was a necessary provision of the Medical Malpractice Act. Because the legislature explicitly found that the Medical Malpractice Act was necessary to lower the costs of medical care in Florida, the court concluded that any contract that seeks to enjoy the benefits of the arbitration provisions pursuant to chapter 766, Florida Statutes, must necessarily adopt all of its provisions.

Thus, medical providers should ensure that any agreement for arbitration offered to patients does not limit the remedies otherwise available under the statutory scheme of the Medical Malpractice Act.

Case Law Alert, 4th Quarter 2013