Future Medical Expenses: How They Are Calculated in Accident Injury Settlements

The weeks following a severe accident are often a blur of immediate concerns: repairing a vehicle, managing acute pain, and handling the initial stack of emergency room bills. However, for those who have suffered catastrophic injuries, whether from a collision on I-10 or a workplace incident at the Port of Mobile, the most significant financial threat often isn’t the bills sitting on the kitchen counter today. It is the cost of care that will be required five, ten, or twenty years down the road.

When you sign a settlement agreement, you are predicting the future. You are making a one-time calculation that must cover every surgery, prescription, therapy session, and home modification you will need for the rest of your life. Get that calculation wrong, and the financial burden shifts from the at-fault insurance company to you and your family. Because settlement releases are final, there are no “do-overs” if you run out of funds.

Understanding the Scope of Future Damages

Under Alabama law, accident victims are entitled to recover compensation not just for past medical expenses, but for “future medical expenses” reasonably certain to be incurred. This legal category encompasses a wide range of healthcare needs that extend far beyond the initial recovery period.

For a young professional injured in a truck wreck on I-65, “future medicals” might mean decades of replacement prosthetics or ongoing physical therapy. For an older individual, it might involve assisted living care or home health aides. The challenge lies in converting these medical needs into a specific dollar amount that a jury or insurance adjuster will accept. This is not a guess; it is a mathematical and medical formulation that requires substantial proof.

How Do Lawyers Calculate Future Medical Expenses in Alabama?

To calculate future medical expenses, attorneys collaborate with medical and financial professionals to create a “Life Care Plan.” This detailed projection accounts for specific future treatments, the frequency of care, current medical costs, and economic factors like medical inflation and the present value of money to determine a lump-sum figure.

Calculating these expenses is rarely a matter of simple multiplication. It involves a comprehensive assessment of the injury’s trajectory. We look at the specific nuances of your medical prognosis to determine:

• Duration of Care: Will the treatment be needed for five years, or for the remainder of your life expectancy?
• Frequency of Treatment: How often will routine procedures, such as steroid injections or physical therapy sessions, be required?
• Hardware Replacement: For implants (like knee replacements or spinal hardware), what is the lifespan of the device, and how many revision surgeries will be needed?
• Complications: What is the statistical probability of developing secondary conditions, such as arthritis or infection, resulting from the original injury?

To withstand scrutiny from defense lawyers in courts like the Mobile County Circuit Court, these calculations must be backed by expert testimony. We often utilize:

• Life Care Planners: Certified professionals who map out every medical need a patient will have over their lifetime.
• Medical Economists: Experts who adjust current costs for future medical inflation, which historically rises faster than general inflation.
• Vocational Experts: Specialists who determine how medical limitations will impact your ability to work and earn benefits.

The Critical Role of Maximum Medical Improvement (MMI)

You cannot accurately calculate the future until you understand the present. This is why we caution clients against accepting early settlement offers before reaching Maximum Medical Improvement (MMI).

MMI does not mean you are “healed” or back to your pre-accident state. It is a medical determination that your condition has stabilized and is unlikely to improve significantly with further treatment. Until a treating physician declares you have reached MMI, any attempt to settle is premature.

If you settle while you are still in the acute healing phase, you are guessing. You might assume a broken leg will heal cleanly, only to discover six months later that a non-union fracture requires bone graft surgery. If you have already settled, the cost of that surgery is yours to pay.

What Types of Future Medical Costs Can Be Included in a Settlement?

Compensable future medical costs include any reasonable and necessary healthcare expense related to the original injury. This covers clear medical needs like future surgeries and medications, as well as supportive costs like home modifications, medical equipment, diagnostic testing, and long-term nursing or attendant care.

The definition of “medical expense” in a personal injury context is broader than what health insurance typically covers. The goal of civil litigation is to make the victim whole, which means covering the full spectrum of costs required to manage a disability or chronic condition.

Common categories of future damages we evaluate include:

• Surgical Interventions: Costs for anticipated procedures, such as hardware removal, joint replacements (like knee or hip), spinal fusions, or reconstructive surgeries. This includes the surgeon’s fee, anesthesiology, operating room charges, and post-operative hospital stays.
• Rehabilitative Therapies: Long-term physical therapy, occupational therapy, or speech therapy regimens, including ongoing sessions with specialists and potential costs for specialized rehabilitation centers.
• Pharmaceuticals: Lifetime costs for managing chronic conditions, including prescription medications for pain management, muscle relaxants, anti-inflammatories, anti-depressants, or other specialty drugs, factoring in potential price increases over time.
• Durable Medical Equipment (DME): Purchase and replacement costs for necessary medical equipment like wheelchairs (manual or motorized), walkers, crutches, hospital beds, oxygen equipment, braces, and specialized commodes. The calculation must account for the regular replacement of this equipment, typically every 5-10 years.
• Diagnostic Monitoring: Costs for annual or semi-annual medical appointments, specialist visits, laboratory tests, and advanced imaging such as MRIs, CT scans, X-rays, or ultrasounds to monitor the stability of an injury or the progression of a condition.
• Home and Vehicle Modifications: The high cost to make a residence accessible, which may include installing permanent wheelchair ramps, widening doorways, installing grab bars, modifying bathrooms (e.g., roll-in showers), or installing elevators/stair lifts. It also covers the cost to purchase and/or modify a vehicle for hand controls or wheelchair accessibility.
• Attendant Care: The cost of in-home nursing assistance, personal care aides, or residential care facilities (such as skilled nursing homes or assisted living) if the injury prevents the individual from performing activities of daily living (ADLs) independently. This can range from a few hours a day to 24/7 care.

The “Battle of Experts” in Alabama Courts

In high-value injury cases, calculating future medical expenses often leads to a “battle of experts.” Insurance carriers for trucking companies or commercial defendants will not simply accept the plaintiff’s numbers. They will hire their own medical experts to argue that:

• The proposed treatment is experimental or unnecessary.
• The costs cited are higher than “usual and customary” rates in Alabama.
• The victim’s life expectancy is shorter than claimed due to pre-existing conditions.

This is particularly common in venues like the Baldwin County Circuit Court or federal courts in the Southern District of Alabama. The defense strategy is to minimize the payout by attacking the necessity of future care.

For example, if a Life Care Plan calls for annual physical therapy for the next 30 years to manage chronic back pain, the defense might argue that a home exercise program is sufficient and costs nothing. Countering these arguments requires strong medical evidence from treating physicians, orthopedic surgeons, neurologists, and pain management specialists who can testify that the prescribed care is medically necessary, not just “optional.”

Can I Reopen My Settlement If My Injuries Get Worse Later?

No, once you sign a release of claims and accept a settlement check, the case is closed forever. You cannot reopen the case or demand more money from the at-fault party, even if your medical condition deteriorates significantly or you require unexpected surgeries years later.

This finality is the most dangerous aspect of personal injury law for the unprepared. The document you sign is typically titled a “Release of All Claims.” It contains legal language explicitly stating that you release the defendant from liability for all injuries “known and unknown, foreseen and unforeseen.”

Because of this rigid rule, the “wait and see” approach is often the safest legal strategy. We must be reasonably certain of the future prognosis before authorizing a release. This protects you from the nightmare scenario of discovering a latent injury, such as post-traumatic arthritis or a delayed-onset brain injury symptom, after the settlement funds have been dispersed.

• Exceptions: Very rare and difficult to prove (e.g., fraud or duress in the signing process).
• Structured Settlements: Sometimes used to manage future payouts, but the total amount is still agreed upon upfront.
• Medicare Set-Asides: Special accounts that may be required to protect your future eligibility for Medicare benefits.

Impact of Life Expectancy and Inflation

Two economic factors heavily influence the final number in a future medical expense calculation: life expectancy and inflation.

Life Expectancy

If a 30-year-old victim requires $5,000 of care annually, the total cost is calculated over their remaining life expectancy. We use standard actuarial tables, but we must also account for the specific health of the individual. Defense attorneys often try to argue that the injury itself (or pre-existing conditions like diabetes or heart disease) shortens the victim’s life expectancy, thereby reducing the amount they should have to pay. We fight to ensure the calculation reflects a fair prognosis.

Medical Inflation

The cost of healthcare rises faster than the Consumer Price Index (CPI). A surgery that costs $50,000 at USA Health University Hospital in Mobile today might cost $80,000 or $100,000 in fifteen years. A valid Life Care Plan must account for this specific rate of medical inflation. If the settlement is calculated using today’s dollars without adjusting for future inflation, the victim will effectively run out of money halfway through their life.

Why You Need an Attorney to Value Your Claim

Insurance adjusters are trained to resolve claims quickly and cheaply. When they present a settlement offer, they often use computer programs (like Colossus) that analyze injury codes but fail to account for the human reality of a permanent disability. At Turner, Onderdonk, Kimbrough & Howell, P.A., we work with respected medical and financial professionals to build a fortress around your future damages claim. We document every anticipated need, justify every expense with medical necessity, and present a comprehensive demand that reflects the true cost of your injury.

If you or a loved one has suffered a serious injury and you are worried about how to pay for long-term care, do not face the insurance companies alone. Please call us at (251) 336-3411 or contact us online to schedule a free, confidential consultation. Let us help you secure the resources you need for the road ahead.