It may come as a surprise, but sometimes I learn of a settlement that is favorable to the plaintiffs, but still strikes me as a bit nuts. Probably I just don’t have all the facts. After all, few defendants voluntarily pay a large sum of money to settle unless they think they run the serious risk of losing quite a bit more if the case were tried to a jury. The case I am about to discuss settled for approximately $7 million, so there may be a lot more to it than what was reported.
The University of Chicago Medical Center may have been cutting corners. The neonatal intensive care unit was overcrowded with babies to such an extent that the Illinois Attorney General described the situation as “absolutely terrifying.” The hospital spokesman denied any patients were harmed. So far, nothing seems out of the ordinary; when parties settle, the agreement typically includes a statement that denies the defendant’s culpability. Essentially, the plaintiff sells the defendant the right to claim innocence.
This case is unusual because the specific terms of a settlement are typically kept secret as a condition of the settlement. Usually, the defendant does not want the publicity, for obvious reasons. But, the way the money is being allocated is the strangest part of all. The bulk of the award, $5.2 million, will go to various hospitals and clinics “that provide preventive medical care for low-income women who face chronic and long-term health issues linked to problems they had in giving birth.” Regardless of your opinion of the merits of this eleemosynary, what does this remedy have to do with a hospital that was overcrowding its neonatal ICU? I doubt this particular charity was picked at random. Was this award representative of the political cronyism that Chicago is famous for? I don’t know, but it sure sounds fishy.
Another strange allocation is that the Center for Medicare and Medicaid Services will receive $500,000. Why is the federal agency that runs Medicaid getting a refund? I can understand that when a Medicaid beneficiary gets an injury settlement, the State Medicaid agency that paid the medical bills should be entitled to a refund. We have a longstanding tradition in this country that a defendant should not get the benefit of a victim’s insurance. But, why should the federal government get anything, especially if no Medicaid patients were actually injured? This particular award may be related to undisclosed facts, but normally the federal government is not entitled to a refund of fees paid out for a Medicaid patient’s care, only the State Medicaid agency has this entitlement.
Frankly, the only part of this award that I do understand and agree with is that the two nurses who blew the whistle about the overcrowding conditions will share $1.4 million. The report indicates that the two are former employees of the hospital. I suspect they were either fired or resigned because of intense pressure. All they did was act in the best interests of their patients by reporting the dangerous conditions to authorities. Yet they are now unemployed and I don’t think it will be easy for them to find other jobs. I know one whisleblower who won a seven figure settlement and then spent years seeking employment, nearly going broke in the process. I hope these two nurses find new employment soon.