Montana's largest malpractice payout spotlights damage caps: Are they unconstitutional?

By Stephanie Srakocic | Fact-checked by Davi Sherman
Published January 12, 2024

Key Takeaways

  • In September 2022, a jury awarded Joey Zahara $6 million—the largest medical malpractice verdict in Montana history. 

  • Montana is one of 30 states that has a cap on non-economic medical malpractice damages. The $250,000 cap represents the lowest in the nation.

  • The cap was passed by the 1995 Montana legislature to make the state a more attractive place for docs to live, the argument being that it would help reduce malpractice insurance premiums—but this has not turned out to be true.

Montana caps non-economic medical malpractice damage awards at $250,000.[] The cap has been in place since the mid-90s and is the lowest cap of any state in the country. 

In recent years, the cap’s constitutionality has been questioned. In September 2022, a Montana jury awarded Joey Zahara $6 million, the largest verdict in the state’s history.

The defense filed for a reduction of the charges in line with Montana’s $250,000 cap, but as of January 2, 2024, the judge presiding over the case, John Kutzman, had still not made a decision whether or not to honor the cap. His verdict will affect not just Zahara’s award, but also the future of damage caps in Montana. 

The largest malpractice award in Montana’s history

Zahara, a Teton County, MT firefighter, had a stroke on June 5, 2013; he was 27. Zahara was rushed to Benefis Health System hospital in Great Falls, MT, where he experienced a second stroke and brain damage. That night, William Henning, MD, was the on-call neurologist. According to the malpractice claim filed later, Dr. Henning never showed up during Zahara’s first night at Benefis. As a result, Zahara did not receive clot-busting tPA treatment. 

Following his strokes, Zahara developed paralysis on his right side. After a month in the hospital, Zahara had recovered some feeling, but has still not regained the use of his right hand. In 2016, Zahara filed a malpractice suit against Dr. Henning’s practice, Advanced Neurology Specialists.

The suit alleged that by not treating Zahara with tPA on the night of June 5, 2013, Dr. Henning caused irreparable damage.

When preparing their case, Zahara and his legal team decided to sue for non-economic damages only. They wanted the jury to focus on the painful everyday impact the incident has had on Zahara’s life. It’s a strategy that paid off: After 4 days of trial in September 2022, the jury found Dr. Henning at fault and awarded the largest medical malpractice verdict in Montana history. 

Now, Zahara, his legal team, and people around the state are waiting to see if the award will stand. 

The debate surrounding Montana’s damages cap

Jurors aren’t told there’s a $250,000 cap on non-economic medical malpractice damages. So, when they‌ determine award amounts in cases such as Zahara’s, they believe the plaintiff will receive the entire award. This is another facet of Montana’s law that makes some call it unconstitutional.[]

As is true in most states that employ a cap on damages in medical malpractice cases, people who support the regulation in Montana argue that it helps make the state an appealing place for doctors to practice medicine.

Ideally, caps on damages help keep malpractice premiums low. Opponents of Montana’s damage caps argue, however, that there’s no evidence the cap has actually reduced malpractice premiums.

Opponents also argue that the cap places undue hardships on patients and families who’ve already been harmed by malpractice. Few law firms in the state will take on medical practice cases due to the low cap.[] Montana also requires plaintiffs hire their own expert witnesses, a cost that, when combined with other legal fees, can significantly cut into awards that max out at $250,000. 

The debate on caps around the country

Montana is one of several states with a spotlight on malpractice caps. For instance, on January 1, 2023, California’s malpractice damage cap increased from $250,000 to $500,00.[] Over the next decade, the cap will rise each year, eventually reaching $1 million. Conversely, Iowa created a cap for medical malpractice damages in February 2023.[] The state now caps damage awards from lawsuits against hospitals and health systems at $2 million and awards from lawsuits against individual physicians and clinics at $1 million. 

The American Medical Association (AMA) is in favor of caps. In a 2023 position paper on liability reform, the AMA cites multiple studies that demonstrate a link between caps and steady, or lowered, malpractice premiums.[] However, it stresses that the ways in which individual pieces of legislation are worded and applied determines their usefulness.

Location and insurance premiums

Your location affects how much you pay for malpractice coverage, but state-regulated caps aren’t the only location-related factor that can influence your premiums.

Jennifer Wiggens, founder of Indiana-based Aegis Malpractice Solutions, has two decades of malpractice experience. She says that location is typically the second factor underwriters look at when setting a premium, and that factors like population and the area's history of lawsuits can make a difference.

“After specialty, the underwriter is going to look at your location," she says. "Underwriters use rating territories, which are usually both state- and county-driven to price coverage based on claim experience in that particular area. Larger metropolitan areas tend to be priced higher than rural ones, but each state is different.”

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