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The Florida Supreme Court has ruled that arbitration awards in medical malpractice cases involving patient deaths cannot be reduced by the routine living costs of the decedent. But because of recent changes in the law, the Supreme Court’s 6-1 decision, released Thursday, pertains only to cases filed before the Legislature amended the Medical Malpractice Act in September 2003. The Legislature has since amended the law to include the economic damage offset. In Evelyn Barlow v. North Okaloosa Medical Center, the Supreme Court ruled that the economic damages awarded to Evelyn Barlow after the death of her husband, Samuel, should be calculated under the provisions of the Medical Malpractice Act, not the Wrongful Death Act. Under the 1988 Medical Malpractice Act, surviving spouses are entitled to “net economic damages” for past and future medical expenses and 80 percent of lost wages and loss of earning capacity. The Wrongful Death Act, passed in 1972, sets stricter limits on how much a surviving spouse can receive for lost wages. Under that law, net income is calculated by subtracting the amount that would have been spent on the decedent’s personal care from their total potential earnings. In February 2002, the 1st District Court of Appeal applied the Wrongful Death Act and unanimously affirmed an arbitration panel’s ruling that the economic damages awarded to Evelyn Barlow should be reduced to reflect the drop in household expenses associated with her husband’s death. But last week, the Supreme Court overturned the 1st DCA’s ruling, saying that Samuel Barlow’s personal consumption didn’t matter. The court based its decision on its 2000 holding in St. Mary’s Hospital Inc. v. Phillipe. In St. Mary’s, the Supreme Court ruled that the arbitration provisions of the Medical Malpractice Act provide the only applicable guidelines for assessing damages, regardless of whether the case involves a wrongful death claim. Social Security reduced Evelyn Barlow filed a malpractice suit against North Okaloosa Medical Center in Crestview after her 66-year-old husband died in the hospital’s intensive care unit in February 1999. Samuel Barlow, who had suffered a stroke, was left unmonitored for 11 hours before ICU nurses realized that he had lapsed into a coma due to continuous intercranial bleeding. During those 11 hours, nurses continued to administer the drug Heparin, an anticoagulant that aggravated the bleeding. Evelyn Barlow and North Okaloosa Medical Center agreed to settle the suit through binding arbitration under the Medical Malpractice Act. Under the act, the hospital admitted liability, and noneconomic damages were automatically capped at $250,000. In March 2001, an arbitration panel awarded Evelyn $102,365 in economic damages, including $93,600 for lost services and $8,765 for funeral expenses. She also received $240,000 for pain and suffering. But the panel did not award any money for lost Social Security benefits. Barlow appealed the panel’s ruling to the 1st DCA. The basis of her appeal was that prior to her husband’s death, the couple was receiving a combined total of $16,500 in annual Social Security benefits. Samuel was receiving $10,822 and Evelyn was getting $5,674. Following Samuel’s death, Evelyn began receiving $11,200 in Social Security benefits. Evelyn Barlow argued that the $5,300 she was losing per year in Social Security benefits due to her husband’s death should have been included in the economic damage award. But in February 2002, the 1st DCA unanimously affirmed the arbitration panel’s ruling, holding that Evelyn Barlow failed to show “not only a fall in household income, but also that lower expenses did not offset the drop.” “Mrs. Barlow didn’t present any evidence that the $5,000 wouldn’t have been consumed by her husband for groceries and other things that he needed,” the hospital’s attorney, William K. Thames, a partner at Thames & Frazier in Pensacola, said in an interview. But the Supreme Court held that it was inappropriate for the 1st DCA to “look beyond the language of the Medical Malpractice Act in determining the damages available to a claimant who agrees to proceed with binding arbitration as provided for under the Act,” Justice Barbara J. Pariente wrote for the majority. Chief Justice Harry Lee Anstead and Justices Charles T. Wells, R. Fred Lewis, Peggy A. Quince and Raoul G. Cantero III concurred. Justice Kenneth B. Bell dissented. In his dissent, Bell said that the Legislature clearly had intended for the damages provisions in the 1988 Medical Malpractice Act to be interpreted in conjunction with the Wrongful Death Act. Because the Medical Malpractice Act does not specifically define “net economic damages,” Bell said, it is perfectly reasonable to look to the Wrongful Death Act for guidance. The high court’s ruling only applies to medical malpractice lawsuits filed before the effective date of last year’s malpractice legislation. But Coral Gables lawyer Gail Parenti, who wrote a friend-of-the-court brief on behalf of the Florida Defense Lawyers Association siding with North Okaloosa Medical Center, said the ruling likely will decrease the number of defendant doctors and hospitals in pending cases who are willing to submit to arbitration. Failing to account for the differences in each decedent’s spending habits results in “a windfall to the estate,” said Parenti, a partner at Parenti Falk Waas Hernandez & Cortina In their arguments to the Supreme Court, Thames and Parenti claimed that the Legislature last year intended to nullify the court’s 2000 ruling in St. Mary’s and require that arbitration awards be offset by decedents’ living expenses. They cited a governor’s task force report last year that contended that St. Mary’s “made it impossible” for defendants to offer to arbitrate. The new law redefined “economic damages” to include the calculation scheme of the Wrongful Death Act. It says economic damages include 80 percent of wage loss and loss of earning capacity “to the extent the claimant is entitled to recover such damages under general law, including the Wrongful Death Act.” But the Supreme Court majority rejected the contention that the Legislature passed the law to overrule its St. Mary’s decision. “There is no indication in either the statutory language or the legislative history that the amendments were passed as a result of this court’s decision,” Justice Pariente wrote for the court. Thames said he is considering filing a request for rehearing based on this issue.

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