Medical malpractice claims are usually among the most hard fought and expensive of all types of personal injury cases. Procedural and substantive law provide that a sufficient case is not established simply by submitting the injured patient’s story to the jury. Instead, expert witnesses must be hired to review all the records of past treatment, scrutinize the care that was provided, and testify whether the defendant was causally negligent by action or omission. The standard of care that is required of all Wisconsin health care providers is defined as the degree of skill, care, and judgment that reasonable healthcare providers who practice the same specialty as the defendant would exercise in the same or similar circumstances, having due regard for the state of medical science at the time the plaintiff was treated. Nowatske v. Osterloh, 198 Wis.2d 419, 543 N.W.2d 25 (1996); Wis. J.I. Civil No. 1023. The burden of proof is on the patient to convince the jury by expert testimony that the defendant was negligent by failing to live up to that standard, and that such failure was a cause of injury. In the vast majority of cases, the standard of care can only be established by the competent testimony of a qualified expert who practices in the same specialty as the defendant. Froh v. Milwaukee Medical Clinic, S.C., 85 Wis.2d 308, 270 N.W.2d 83 (Ct. App. 1978); Kuehnemann v. Boyd, 193 Wis.588, 214 N.W. 326 (1927). As required in the Wisconsin Civil Jury Instruction number 1023, there is no case unless the expert testifies to a reasonable degree of medical certainty that the defendant failed to comply with the applicable standard of care.
In what may be perceived as a surprise to patients, the law provides that a doctor is not negligent simply because a bad result may have followed the treatment. Bad results do not create any inference or presumption of negligence. Hoven v. Kelble, 79 Wis.2d 444, 256 N.W.2d 379 (1976). The question is whether the doctor complied with the appropriate standard of care, and not whether there was a bad result, bad judgment or mistake.
The requirement of expert testimony creates the expense problem. The last thing most physicians or other health care professionals want to do in their free time is to review claims against their colleagues, or to testify against them. Such activity is often seen as traitorous, and as potentially raising the insurance premiums for all similarly situated professionals. It has long been said that there is a so-called “conspiracy of silence” in regards to the mere mention of malpractice among health care professionals. It is obvious that physicians who are acquainted with each other, live in the same community, or are members of the same professional associations would ordinarily be reluctant to criticize each other publicly. Such physicians will often refuse to speak to malpractice victims or their attorneys about the merits of their claims against other local physicians. For this reason, patients must usually resort to fee-based consulting physicians from far away, who have no organizational or personal ties to the defendant, for the expert testimony required in a lawsuit.
Finding, hiring and preparing experts in medical malpractice cases is extremely difficult and expensive for attorneys.
In addition to the difficulty encountered by injured patients in locating willing expert witnesses, the matter of cost is a deterrent. Competent, successful, and busy medical practitioners ordinarily make an excellent living practicing their trade. They enjoy what they are doing in their offices or hospitals. They often are compensated at an annual rate well into six figures. A lawyer’s office or courtroom is foreign territory to them, fraught with the dangers of the unknown. They are loath to wander there. If they do venture forth into forensic medicine at all, they customarily charge at an hourly rate that would shock the conscience of the uninitiated (i.e., it is not unusual for a malpractice plaintiff’s attorney to have to pay $500 per hour or more to obtain expert review of records and testimony by qualified physicians).
Principally because of the high cost of eliciting expert testimony, the total out-of- pocket expense, excluding attorney’s fees, of preparing a medical malpractice case from start to finish is usually not less than $50,000.00, and often exceeds $100,000.
It is easy to see why potential malpractice claims involving relatively minor injuries simply cannot be pursued economically, no matter how strong the liability case may be. If we assume a $100,000 recovery, a 33 1/3% standard attorney fee, and $50,000 in costs, the patient would have a net recovery of only $16,667 ($100,000 minus $83,333). Personal injury attorneys who specialize in malpractice cases customarily decline to prosecute any case unless there is a verdict potential of substantially more than $100,000.
Pursuant to Wis. Stat. § 655.43, before any malpractice lawsuit may proceed, the parties are required to submit the claim to mediation. Mediation tolls the statute of limitations until thirty days after the last day of the mediation period.
One public lay person, one physician and one attorney comprise the mediation panel. The panel reviews the medical records (excluding expert reports), meets with the parties and their attorneys. No lay or expert witnesses may participate or be subpoenaed. A stenographic record of the proceedings is not kept. The panel makes a non-binding recommendation. The results of mediation are not admissible in a subsequent court action.
The number of Requests for Mediation filed in Wisconsin over the past six years is as follows:
Typically 60-70% of the Requests for Mediation result in the commencement of a circuit court action.
According to information provided by the administrator of the Malpractice Mediation Panels, the results of the medical malpractice verdicts following jury trials in Wisconsin over the last ten years is as follows:
Medical Malpractice Verdicts in Wisconsin:
Thus, over the last ten years it is apparent that in medical malpractice cases that go to verdict in Wisconsin, the patient has only a 25% chance of winning (41/176)!
There is a federally monitored National Practitioner Data Bank that contains information on specific variables taken from Adverse Action Reports and Medical Malpractice Payment Reports received by the NPDB on licensed health care practitioners, as well as information from reports of Medicare and Medicaid exclusion actions. See https://www.npdb.hrsa.gov
Information from the NPDB data compilations can be used to rank each of the 50 states, together with the District of Columbia, by the number of payments for doctor errors per population. In other words, the ratio of the number of medical malpractice payments in each state divided by the population in each state can be viewed. Wisconsin is dead last, with payments going to only 1:199,012 of Wisconsin citizens in 2015! Every state has a higher percentage of its citizens making a medical malpractice recovery against physicians than does Wisconsin.
The current jury sentiment against personal injury claimants, fostered by insurance companies, heightens in medical malpractice cases. When this reality is coupled with the cost of prosecution, it becomes evident that only a very few medical malpractice cases meet the criteria for a good chance of a substantial net recovery.
There are numerous powerful defenses conjured up by health care providers to defeat claims of malpractice. These include the well-intentioned, good-doctor-should-not-be-sued defense; the recognized alternative treatment defense; the no-causation defense that the natural progression of a pre-existing condition would have led to the same result, even if due care had been administered; and the error-in-judgment-does-not-equal-malpractice defense. Doctors and hospitals have easy access to defense experts who are eager to thwart claims.
For all these reasons, malpractice insurers often make no settlement offers at all when they believe that they have a chance to win at trial. They operate under the assumption that by making it difficult for one plaintiff to recover, no matter how legitimate the claim, the next plaintiff may be deterred from prosecuting his or her case.
Only the most egregious medical malpractice liability cases involving clear liability and catastrophic damages are now economically feasible from the perspective of plaintiffs’ attorneys. Anyone who says otherwise has not been there or done that.
WHO CAN SUE
Under Wisconsin law, there is a difference between the class of persons allowed to bring a wrongful death claim arising out of medical malpractice, versus the class of persons allowed to bring a wrongful death claim arising out of any other tort. In wrongful death cases arising out of medical malpractice, if the victim is an adult, only a spouse or minor child may sue, but an adult child may not sue. Czapinski v. St. Francis Hosp., 236 Wis.2d 316, 613 N.W.2d 120 (2000); Ziulkowski v. Nierengarten, 210 Wis.2d 98, 565 N.W.2d 164 (Ct. App. 1997). The classification of claimants entitled to sue for loss of society and companionship damages resulting from the wrongful death of a medical malpractice victim is limited to those listed in Wis. Stats. §655.007, which includes only a spouse, parent, minor sibling or minor child. Adult children simply lack standing to sue. The Wisconsin Supreme Court held in the Czapinski case that the difference in the classes of allowable plaintiffs in medical malpractice wrongful death cases compared to other wrongful death cases is not a violation of the Equal Protection Clause of the Fourteenth Amendment to the U.S. Constitution.
On July 10, 2007, the Wisconsin Supreme Court held that Wis. Stats. § 655.007 limits the survival of a cause of action for wrongful death arising from medical malpractice to a spouse, parent, minor sibling or minor child. Lornson v. Siddiqui, 2007 WI 92, 302 Wis.2d 519, 735 N.W.2d 55 (2007). Contrary to the hierarchical list of wrongful death claimants in Wis. Stats. § 895.04(2), which includes adult children as lineal heirs, an adult child lacks standing to recover for a derivative claim, such as loss of society and companionship, in a wrongful death case involving medical malpractice. The Supreme Court held that the intended exclusivity of ch. 655, Wis. Stats., prohibits the application of Wis. Stats. § 895.04(2), governing other wrongful death claims.
A parent of an adult child does not have a cause of action for loss of society and companionship arising out of the medical malpractice causing injury to the adult child. See Wells Estate v. Mt. Sinai Medical Center, 183 Wis.2d 667, 515 N.W.2d 705 (1996), which held that no such cause of action is allowed for medical malpractice causing injuries, as opposed to the death of an adult child.
Brusa v. Mercy Health System, 301 Wis.2d 138, 737 N.W.2d 1 (Ct. App. 2007), held that a fetus conceived but not yet born prior to malpractice committed upon a parent was entitled to sue. The crux of the dispute is the right of a child to pursue a derivative medical malpractice claim for the death of the parent. The right to bring a derivative claim for medical malpractice is determined by the claimant’s status at the time of the victim’s injury. A child who has been conceived but not yet born at the time of the injury may bring a derivative claim for loss of society and companionship when medical malpractice causes the death of a parent. Lefevre by Grapentin v. Schrieber, 167 Wis.2d 733, 739, 482 N.W.2d 904 (1992) (a posthumously born legitimate child can bring a wrongful death claim, even though the child was not born at the time of the accident).
RES IPSA LOQUITUR
In Fehrman v. Smirl, 20 Wis.2d 1, 121 N.W.2d 255, 122 N.W.2d 439 (1963), the Wisconsin Supreme Court held that res ipsa loquitur may be invoked in medical malpractice actions when a layman is able to say as a matter of common knowledge that the consequences of the professional treatment are not those which ordinarily result if due care is exercised, and the defendant has exclusive control of the instrumentality that caused harm. See also Hoven v. Kelble, 79 Wis.2d 444, 256 N.W.2d 379 (1977). When these two conditions are present, they give rise to a permissive inference of negligence on the part of the defendant which the jury is free to accept or reject. When there is no basis of common knowledge for such a conclusion, a jury instruction embodying res ipsa loquitur may be grounded on expert medical testimony. Shurpit v. Brah, 30 Wis.2d 388, 141 N.W.2d 266 (1966); Knief v. Sargent, 40 Wis.2d 4, 161 N.W.2d 232 (1968).
Trogun v. Fruchtman, 58 Wis.2d 569, 596-600, 207 N.W.2d 297 (1973), is the seminal case. It involved a physician’s failure to inform the patient about the side effects of a drug for tuberculosis. The modern doctrine has been codified under Wis. Stat. § 448.30, which sets forth in general terms what type of information a doctor should provide to a patient. Under current Wisconsin law, an informed consent claim is now treated as a subset of medical malpractice actions under negligence theory, the elements of which are: (1) the patient was not informed of the risks in the proposed treatment or procedure of which a reasonable person in the patient’s position would wish to be made aware; (2) a reasonable person in the patient’s position presented with such information would not have chosen to submit to the treatment or procedure; and (3) the failure to disclose such information was a cause of the patient’s injuries.
In Scaria v. St. Paul Fire & Marine Ins. Co., 68 Wis.2d 1, 227 N.W.2d 647 (1975), the claim was that a physician failed to inform a patient that a contrast die used for radiation could cause paralysis or death. The Supreme Court concluded that a physician’s duty to reveal the risks and benefits of available treatment options extended to the information a reasonable patient would need to know in order to make an informed decision.
In 1981 the legislature enacted Wis. Stat. §448.30, and amended the statute in 2013 effective December 14, 2013 (2013 Wisconsin Act 11), to provide as follows:
INFORMATION ON ALTERNATE MODES OF TREATMENT
“Any physician who treats a patient shall inform the patient about the availability of all alternate, viable medical modes of treatment and about the benefits and risks of these treatments. The reasonable physician standard is the standard for informing a patient under this section. The reasonable physician standard requires disclosure only of information that a reasonable physician in the same or a similar medical specialty would know and disclose under the circumstances. The physician’s duty to inform the patient under this section does not require disclosure of:
- Detailed technical information that in all probability a patient would not understand.
- Risks apparent or known to the patient.
- Extremely remote possibilities that might falsely or detrimentally alarm the patient.
- Information in emergencies where failure to provide treatment would be more harmful to the patient than treatment.
- Information in cases where the patient is incapable of consenting, or
- Information about alternate medical modes of treatment for any condition the physician has not included in his or her diagnosis at the time the physician informs the patient.”
In Martin by Scopter v. Richards, 192 Wis.2d 156, 531 N.W.2d 70 (1995), the parents of a minor child who suffered brain damage and spastic quadriplegia caused by intracranial bleeding following a concussion in a vehicular accident, brought a medical malpractice action against a Fort Atkinson hospital and physicians, alleging that the emergency room physician who examined child, and the physician who admitted the child based on information provided by the emergency room physician, should have informed the parents that a CT scanner was available to diagnose the extent of injuries, and that there would be significant delay in the hospital’s ability to treat the child if she developed intracranial bleeding, because she would have had to be transferred to a facility that had a neurosurgeon. The hospital had a CT scanner but no neurosurgeon. The hospital admitted the patient without informing the family that a transfer would have been a better option. When she later developed intracranial hemorrhaging, she had to be transported by flight for life to a Madison hospital, where she underwent brain surgery, which was too late to avoid major disability. The case proceeded to trial and the jury found for the patient, awarding $5,000,000. On appeal, the Supreme Court held that the emergency room physician was required to inform parents as to alternate forms of treatment, and the failure to do so was a violation of informed consent law.
Johnson v. Kokemoor, 199 Wis.2d 615, 545 N.W.2d 495 (1996), involved a claim that the informed consent discussion that took place between the provider and patient before a medical procedure had not adequately informed the patient of the morbidity rates and the physician’s lack of experience in performing the procedure. The patient brought an action against the surgeon alleging that his failure to provide sufficient relevant information vitiated her consent to basilar bifurcation aneurysm surgery, and was a violation of the conformed consent law. The court held that: (1) evidence regarding the neurosurgeon’s lack of experience with the particular surgical procedure and difficulty of proposed procedure was properly admitted; (2) statistical evidence concerning morbidity and mortality rates when the surgery at issue was performed by a physician of limited experience, such as defendant surgeon, and by acknowledged masters in field was properly admitted; and (3) evidence that the surgeon should have advised patient of the possibility of undergoing surgery at a tertiary care facility with a more experienced surgeon in a better-equipped facility was properly admitted at trial.
In Schreiber v. Physicians Ins. Co. of Wisconsin, 223 Wis. 2d 417, 433, 588 N.W.2d 26, 33 (1999), a patient, her husband, and their quadriplegic child brought a medical malpractice action against physician, alleging that the physician’s refusal to perform cesarean delivery violated the informed consent statute. The woman, who was undergoing a difficult labor and delivery, had previously delivered two children by caesarean section but had elected a vaginal birth for her third child. After originally consenting to vaginal delivery, she changed her mind and withdrew her consent. Because alternative viable modes of medical treatment existed at that time, the court determined that her withdrawal constituted a substantial change in circumstances, obligating the doctor under Wis. Stat. § 448.30 to conduct a new informed consent discussion affording the patient the opportunity for a choice of treatment. The doctor’s failure to conduct such a discussion deprived the patient of the opportunity to proceed with her actual and clearly expressed choice, a cesarean delivery. In applying the subjective test to causation, the court concluded that the plaintiffs’ damages flowed from the doctor’s failure to conduct the informed consent discussion.
In Hannemann v. Boyson, 282 Wis.2d 664, 698 N.W.2d 714 (2005), a patient claimed that a chiropractor had negligently performed a cervical spinal manipulation, which caused a stroke, and that the chiropractor had failed to provide sufficient information about the risks and alternative treatments necessary to constitute informed consent. The Supreme Court agreed, holding that chiropractors have the same duties as medical doctors to comply with the informed consent statute. The special verdict questions that go to the jury must inquire not only about negligent treatment, but also lack of informed consent.
In Bubb v. Brusky, 2009 WI 91, 321 Wis. 2d 1, 38, 768 N.W.2d 903, a patient who suffered a stroke within two days of an emergency room visit occasioned by a transient ischemic attack (TIA), filed a medical malpractice action against the emergency room physician. He claimed that the physician failed to obtain informed consent by sending him home rather than discussing the alternative of being admitted, have a carotid ultrasound and other tests, an a timely consultation with a neurologist. The Supreme Court held that by failing to adequately inform the patient of the availability of all alternate, viable medical modes of treatment, the physician was subject to liability and that the jury should decide whether he had violated the statute.
In Jandre v. Wisconsin Injured Patients and Families Compensation Fund, 2012 WI 39, 340 Wis. 2d 31, 813 N.W.2d 627, a patient brought a medical negligence and informed consent claims against an emergency room physician, alleging that the physician negligently diagnosed Bell’s palsy and failed to inform the patient of a test to rule out a stroke. The doctor had ordered a CT scan to rule out a hemorrhagic stroke, and also a clinical test to listen for carotid bruits with a stethoscope, but the doctor did not discuss with the patient: (1) that he had an atypical presentation of Bell’s palsy; (2) that his symptoms were also consistent with an ischemic stroke event; (3) that the doctor’s method of eliminating an ischemic stroke event from the differential diagnosis was “very poor”; (4) that the doctor could have ordered a carotid ultrasound or other tests to definitively rule out the possibility of an ischemic stroke event; and (5) that an event such as a transient ischemic attack (TIA) or a reversible ischemic neurologic deficit (RIND) is often a harbinger of a full-blown ischemic stroke. Eleven days later the patient suffered a full-blown stroke, which impaired his physical and cognitive abilities. The Supreme Court upheld a verdict for the patient on the informed consent claim, holding that the physician had a duty to inform the patient of the availability of a carotid ultrasound, an alternative, non-invasive, viable means of determining whether he had suffered an ischemic stroke, rather than an attack of Bell’s palsy.
JOINT AND SEVERAL LIABILITY
Under a traditional rule of joint and several liability, where more than one defendant is found liable for the injury suffered by a plaintiff, each defendant is individually liable for the entire amount of the judgment, such that if one defendant is unable to pay the other defendant or defendants are liable for the entire amount of the judgment. Pursuant to Wis. Stat. § 895.045, Wisconsin has modified this rule such that, unless a defendant is more than 50% responsible for a plaintiff’s injury or acted in concert with other defendants to cause the plaintiff’s injury, each defendant is liable for damages in an amount proportionate to that defendant’s percentage of causal negligence for the plaintiff’s injuries.
Common law vicarious liability rules apply to malpractice claims. The liability of an employer for the negligence of an employee is still very much the law. An obvious example is the liability of a hospital for the negligence of nurse-employees. The theory of apparent agency can also be applied in circumstances where there is an independent contractor relationship between the principal and the agent, but the principal has the right to control the activities of the agent. This can be applied to the liability of a hospital for the negligence of independent radiologists, anesthesiologists, hospitalists, contracting nurses, and other providers. Kashishian v. Port, 167 Wis. 2d 24, 33, 481 N.W.2d 277, 280 (1992)(independent contracting nuclear cardiologist); Pamperin v. Trinity Memorial, 144 Wis.2d 188, 199, 423 N.W.2d 848 (1988) (independent contracting emergency room physicians). An employer of an independent contracting physician may be subject to liability under the doctrine of apparent authority when all of the following apply:
- the hospital, or its agent, acted in a manner that would lead a reasonable person to conclude that the individual who was alleged to be negligent was an employee or agent of the hospital;
- where the acts of the agent create the appearance of authority, the plaintiff must also prove that the hospital had knowledge of and acquiesced in them; and
- the plaintiff acted in reliance upon the conduct of the hospital or its agent, consistent with ordinary care and prudence.
STATUTE OF LIMITATIONS
Pursuant to Wis. Stat. § 893.55, medical malpractice actions must be filed within three years of the date of the act or omission resulting in injury, or one year from the date the injury was or reasonably should have been discovered, whichever is later. However no medical malpractice action may be filed more than five years from the date of the act or omission underlying the claim unless a health care provider conceals from a patient a prior act or omission of the provider that has resulted in injury to the patient, in which event the action shall be commenced within one year from the date the patient discovers the concealment or, in the exercise of reasonable diligence, should have discovered the concealment, or within the time limitation described above, whichever is later. For medical malpractice cases involving minors, a lawsuit must be filed by the minor’s tenth birthday or within the general medical malpractice limitations period, whichever is later.
In Phelps v. Physicians Ins. Co. of Wisconsin, Inc., 319 Wis.2d 1, 768 N.W.2d 615 (2009) the Supreme Court held that, for purposes of both the estate of the patient-decedent’s medical malpractice survival action and the patient-decedent’s estate and heirs’ wrongful death action following the patient’s death, the statute of limitations accrued on the date that a sponge was left in a wound, causing symptoms of which the patient was aware.
LIMITS ON ATTORNEY’S FEES
Pursuant to Wis. Stat. § 655.013, attorney fees are limited to one-third of the first $1 million, or 25% of the first $1 million if the defendant stipulates to liability within a specified timeframe. Attorney fees are limited to 20% for any recovery in excess of $1 million.
The damages recoverable in a malpractice case include the following components:
- Pain, suffering and noneconomic effects of disability;
- Loss of consortium, society and companionship or loss of love and affection;
- Loss of earnings or earning capacity;
- Medical expenses.
- Other economic injuries and damages.
On July 14, 2005, the Wisconsin Supreme Court ruled that the $350,000 cap on non-economic damages in medical malpractice cases, Wis. Stats., § 893.55(4)(d) violated the equal protection clause of the Wisconsin Constitution and was therefore void. Ferdon v. Wisconsin Patients Compensation Fund, 2005 WI 125, 284 Wis.2d 573, 701 N.W.2d 440 (2005). This decision removed the cap on non-economic damages in medical malpractice cases that do not result in death.
Thereafter, the Wisconsin legislature enacted a new cap for damages in medical malpractice cases, which was signed by the governor into law effective April 6, 2006, creating a maximum limit of $750,000 for non-economic damages. See Wis. Stat. §§ 655.017 and 893.55(4)(d). If the malpractice results in death, the old $350,000 cap applicable under Wis. Stat. § 895.04 still applies, subject to inflationary additions. See Wis. Stat. § 893.55(4)(f). Future medical expenses in excess of $100,000 are paid into a special fund, rather than directly to the patient. §655.015.
On July 7, 2006, the Wisconsin Supreme court overruled in part its earlier decision in Maurin v. Hall, 2004 WI 100, 274 Wis. 2d 28, 682 N.W.2d 866 and held that that the cap on non-economic damages in medical malpractice cases that result in death should separately be applied to: (1) the two types of pre-death claims: (a) to the estate of the decedent for the pain and suffering of the decedent, and (b) to the surviving spouse for the loss of society and companionship of the decedent; and (2) the loss of society and companionship of the spouse, children or parents of the deceased, or to the siblings of the deceased, if they were minors at the time of the death. Bartholomew v. Wisconsin Patients’ Compensation Fund, 2006 WI 91, 293 Wis.2d 38, 717 N.W.2d 216 (2006).
Therefore, under current law, if the malpractice results in death, there is a $350,000 cap for non-economic damages for the death of an adult, and a $500,000 cap for non-economic damages for the death of a minor, subject to inflationary additions. There is $750,000 cap for pre-death non-economic damages in medical malpractice cases, but if the malpractice results in death, there is still a $350,000 cap for non-economic damages for the death of an adult, and a $500,000 cap for non-economic damages for the death of a minor, subject to inflationary additions.
Punitive damages are not recoverable in medical malpractice cases. Lund v. Kokemoor, 195 Wis.2d 727537 N.W.2d 21 (Ct. App. 1995). However, Wis. Stats. § 895.441, specifically provides that punitive damages are recoverable in actions based on a physician’s sexual exploitation of a patient. Those types of claims would be subject to a requirement, under Wis. Stat. 895.043(3), that the plaintiff prove “that the defendant acted maliciously toward the plaintiff or in an intentional disregard of the rights of the plaintiff.”
Physicians are responsible for their own personal underlying medical malpractice insurance coverage for the first $1,000.000. Wis. Stat. § 655.23.
The Injured Patients and Families Compensation Fund provides umbrella coverage for all physicians for any liability over $1,000,000 if a premium is paid. Wis. Stat. § 655.27.
COLLATERAL SOURCE RULE AND SUBROGATION
Under a traditional collateral source rule, a defendant may not seek to reduce its liability by introducing evidence that the plaintiff has received compensation from other sources, such as the plaintiff’s own health insurance coverage. For medical malpractice cases in Wisconsin, evidence of payment from collateral sources is admissible at trial pursuant to Wis. Stat. § 893.55(7). See Lagerstrom v. Myrtle Werth Hospital – Mayo Health System, 285 Wis.2d 1, 700 N.W.2d 201 (2005).
The insurance companies that pay the patient’s medical expenses are entitled to reimbursement out of any recovery the plaintiff obtains from the at fault health care providers, under ordinary subrogation rules. By virtue of and to the extent of payments made on behalf of the injured party, the payor, or subrogated party, generally obtains a right of recovery in an action against the tortfeasor and is a necessary party in such action. Lagerstrom, 285 Wis.2d 1, ¶ 64, 700 N.W.2d 201; Koffman v. Leichtfuss, 246 Wis.2d 31, ¶ 33, 630 N.W.2d 201.
Alternatively, the payor may waive its right to subrogation in favor of reimbursement. Lagerstrom, 285 Wis.2d 1, ¶ 64, 700 N.W.2d 201. In either case, the policy goals are the same: subrogation helps to ensure that the loss is ultimately placed upon the tortfeasor and prevents the injured party from being unjustly enriched through a double recovery, i.e., recovery from both the subrogated party and the tortfeasor. The trial court must first determine whether the evidence of collateral source payments is relevant before allowing the evidence to be admissible. Weborg v. Jenny, 341 Wis.2d 668, 816 N.W.1d 191 (2012). An erroneous admission of such evidence is not necessarily reversible error.
In Konkol v. Acuity Insurance, A Mutual Company, 321 Wis.2d 306, 775 N.W.2d 258 (Ct. App. 2009), the court held that a tortfeasor’s insurer was not entitled to subrogate against a tort victim’s negligent health care provider with respect to the cost of allegedly unnecessarily incurred medical expenses paid by the insurer for treatment of injuries sustained in an automobile accident.