Self Administration assistance – Potential liability trap?
There has been some recent debate within the MSA industry as to the wisdom of offering self-administration support to claimants post settlement. The defense is worried about creating liability where none previously existed, while the claimant attorneys do not want to be on the line for future malpractice claims. Both of these concerns are in my opinion overblown and more academic than realistic.
MEDVAL offers free self administration support on all of our MSAs. We also offer a second, more comprehensive level of self-administration support for a yearly fee. And since 2003, we have offered full professional administration for those claimants that need the service.
While anything is possible in terms of litigation, we assess the risk of offering self-administration advice to be minimal. And while we are prepared to defend ourselves and assist our clients in their defense, I do not expect many lawsuits to be forthcoming for a variety of reasons.
First, there is likely little to be gained. Almost all of our MSAs are annuitized and thus the damages are limited to a year or two of payments. Second, people sue when they feel like they have been treated unfairly. Clients that offer self-administration support do so voluntarily and at their own expense. We find that helping the claimant get started goes a long way to making sure they spend the money correctly. Our experience is that claimants are thankful for the help and appreciate having someone to turn to after the case has been settled. Finally, even if there are damages and the claimant is inclined to sue, we feel like they have a heavy burden in attributing negligence to either MEDVAL or the clients that established the administration arrangement.
I am looking forward to the claim where an MSA was established, the claimant signed off on their responsibilities, the settlement was approved by a judge, additional advice and guidance was voluntarily provided post-settlement and the claimant chooses to ignore all of the foregoing to blow the money. I like my legal chances.
Too many people in the MSA industry are afraid of what might happen in a variety of improbable circumstances. Be afraid of things you can’t control like an asteroid hitting the earth, a swarm of killer bees migrating north or a 58% marginal tax bracket. Dealing with MSP issues is a risk management decision and I believe clients that choose to offer self-administration support are making the correct choice.