Tuesday, September 16, 2008

ICD Class Action: Patients 40%, Lawyers 60%

As reported in the Star Tribune regarding the faulty implantable cardiac defibrillator (ICD) battery suit settled by Medtronic from the recall of 2005:
Less than half of the Medtronic settlement has been mailed to people who received defibrillators that were recalled in 2005 because of concerns about battery failures. The rest of the disbursements remain stalled, as lawyers deal with Medicare and Medicaid issues and third-party liens.

"We wanted to get some money into the hands of the claimants while we get other issues resolved," said Dan Gustafson, a Minneapolis lawyer and co-lead counsel in the Medtronic lawsuit.

But getting 40 percent of your total damages in September 2008 from a settlement that was announced in December 2007 still rankles some of those people who wore the recalled devices.
One would think this legal wrangling would be negotiated ahead of time, but I've got to say that there's some justice being served here as lawyers get to deal with Medicare and Medicaid issues, too.



Anonymous said...

That's a relatively misleading caption to this story, because the lawyers aren't actually "getting" 60%. Anyone who has ever dealt with Medicaid/Medicare in seeking to pay them back from a settlement knows it takes many, many months to get a response.

Medicaid/Medicare puts a lien on the attorneys, and they will be liable if they pay out to the patient and the patient doesn't reimburse. The lawyers are likely negotiating with Medicaid/Medicare to knock the amount they want to be reimbursed for each patient down a little, which will ultimately put even more in the patients' pockets.

But I will admit, you'll get more physician indignation and page views if they think that the lawyers are actually keeping 60% of the settlement funds. So from your personal marketing standpoint, it's a good headline.

DrWes said...

anony 6:56 -
Thanks for the clarification - BTW for clarification, any idea what portion Medicare/Medicaid receives from the damages awarded vs. the legal teams?

Anonymous said...

Medicare/Medicaid is entitled to what it paid. I have handled cases where, say there was only $50,000 available to pay a claim, and the govt. had a claim of $40,000, and the patient still has significant injuries they will usually do an equitable reduction where the patient ends up getting 1/3 in their pocket, the govt. takes a 1/3 of the $50K, and the lawyer gets their share. Although sometimes they'll require the lawyer to knock his/her fee down too.

This particular case is a class action, it seems, and typically the lawyers are paid separately from the amount dedicated to the claimants. That will be public record in the case, as there is usually a hearing where the court approves the award of fees.