The Wisconsin Supreme Court heard oral statements Tuesday in a case that could change the way medical malpractice lawsuits are handled in the state.

The case stems from a malpractice suit in which a trial court found a doctor negligent for injuries a baby sustained during birth.

In this initial case, the family of Matthew Ferdon, who now has a deformed and partially paralyzed right arm from the injury, was awarded more than $1 million in total medical expenses and damages.

However, due to state law, the amount of non-economic damages, often referred to as pain and suffering, is capped. The award for medical expenses, though, is not capped.

“The state of Wisconsin has a limit on the amount of money a victim of malpractice can collect for pain and suffering,” Marie Stanton, the Ferdons’ lawyer, said. “At the time of Matthew’s trial in December of 2002, he was awarded $700,000 by the jury, but that was reduced because of the limiting statute to $433,000.”

The Ferdon family’s attorney argued the client was denied equal-protection rights due to the cap, and the Supreme Court case will decide whether the capping of non-economic damages is constitutional.

The Injured Patients and Families Compensation Fund was named as the defendant in the case and is represented by attorney Steven Means.

The compensation fund pays malpractice victims and is responsible for the limitation on non-economic damages.

Stanton said if the Supreme Court finds the cap unconstitutional, it will set the precedent for eliminating the cap in future cases.

Supporters of the cap say it helps keep physicians in Wisconsin because it results in lower health-care costs for both providers and patients.

The compensation fund, which falls under Chapter 655 of the Wisconsin Constitution, could be in jeopardy if the case is decided in this manner, Means said.

“Wisconsin is generally regarded as a ‘magnet state’ for health-care providers,” Means said. “It’s considered one of the few states in the nation that is not in crisis because of liability-insurance rates.”

This could change if the cap is removed, Means added.

“I think it will have an adverse effect on the delivery of health care in the state,” Means said.

Mike Prentiss, spokesperson for state Sen. Scott Fitzgerald, R-Juneau, agreed the removal of the cap could be harmful for medical practice in Wisconsin.

“If the Supreme Court were to overturn the cap, it would indirectly or directly result in higher health-care costs … and [would increase] difficulty in accessing medical care,” Prentiss said.

Physicians and other health-care providers would have to pay higher malpractice insurance, resulting in higher costs for everyone, Prentiss added.

Prentiss also mentioned that if Democratic Gov. Jim Doyle’s budget proposal to transfer money from the Patient Compensation Fund to other state programs is passed in the state Legislature, the decreased financial coverage for health-care providers could further hurt Wisconsin.

If the state taps the patient-compensation fund and removes the caps on medical-malpractice claims, the combination of the two would be a “double whammy” and could do even further damage to health care, Prentiss said.

But Doyle spokesperson Melanie Fonder said the compensation fund has an excess of $200 million, and the extra funds should be used to keep the state’s 180,000 BadgerCare and SeniorCare participants on health care.

“It is simply unacceptable to take health care away from those people who need it the most,” Fonder said.

This is not the first time the state Supreme Court has reviewed the constitutionality of the medical malpractice caps. A Milwaukee woman challenged St. Francis Hospital in 2000, but the Supreme Court deadlocked 3-3 and the case was returned back to the 1st District Court of Appeals in Milwaukee, where the constitutionality of the caps was upheld.