Medical Malpractice Settlement Agreement (Kentucky)

MEDICAL MALPRACTICE SETTLEMENT AGREEMENT AND MUTUAL RELEASE

(Kentucky)

TABLE OF CONTENTS

1. Document Header
2. Definitions
3. Settlement Consideration; Payment Mechanics
4. Releases
5. Representations & Warranties
6. Confidentiality; Non-Disparagement
7. Medicare / Medicaid / Lien Resolution
8. Tax Treatment
9. NPDB / Board Reporting
10. Default & Remedies
11. Dispute Resolution
12. General Provisions
13. Execution Block

1. DOCUMENT HEADER

1.1 Parties

This Medical Malpractice Settlement Agreement and Mutual Release (the "Agreement") is entered into as of [EFFECTIVE DATE] by and between:

1.2 Recitals

A. Claimant alleges that Provider's care rendered on or about [DATE(S) OF CARE] caused [INJURY DESCRIPTION] (the "Claim").
B. The Claim is or may be the subject of an action styled [CASE CAPTION], [___] Circuit Court, Kentucky, Civil Action No. [___] (the "Action").
C. The Parties acknowledge that, under Ky. Const. § 54 and the jural rights doctrine reaffirmed in Williams v. Wilson, 972 S.W.2d 260 (Ky. 1998), Kentucky imposes no statutory cap on noneconomic or punitive damages in personal-injury actions, and following Commonwealth v. Claycomb, 566 S.W.3d 202 (Ky. 2018), no medical-review-panel screening is required.
D. The applicable limitations period under KRS § 413.140(1)(e) and (2) (one year, subject to the discovery rule) is [has not expired / is preserved by the Action].
E. The Parties wish to fully and finally resolve the Claim without admission of liability.

NOW, THEREFORE, in consideration of the mutual covenants and the payments described below, the Parties agree as follows.

2. DEFINITIONS

"Action" — the lawsuit described in Recital B.
"Claim" — the matter described in Recital A and all Released Claims defined in Section 4.
"CMS" — the Centers for Medicare & Medicaid Services.
"Confidential Information" — all terms of this Agreement and all settlement-related communications.
"Effective Date" — the date last signed below.
"NPDB" — National Practitioner Data Bank, 42 U.S.C. § 11131 et seq.
"Settlement Payment" — the consideration described in Section 3.

3. SETTLEMENT CONSIDERATION; PAYMENT MECHANICS

3.1 Amount

In full and final settlement, Insurer/Provider shall pay Claimant a total of $[AMOUNT] ("Settlement Payment"), payable as follows:

☐ Lump sum within [30] days of the later of (a) the Effective Date, (b) delivery of fully executed releases, and (c) completion of any required Medicare/Medicaid lien resolution under Section 7.
☐ Structured settlement per Schedule A and a Qualified Assignment under IRC § 130.
☐ Court approval under CR 17.03 if Claimant is a minor or under legal disability (probate court approval per KRS ch. 387 where required).

3.2 Allocation

3.3 No Admission

The Settlement Payment is made to compromise disputed claims. Provider expressly denies liability and fault. See KRE 408 (settlement communications inadmissible).

3.4 Dismissal

Within [10] business days of receipt of the Settlement Payment, Claimant shall file an Agreed Order of Dismissal with Prejudice of the Action, each Party to bear its own remaining costs.

4. RELEASES

4.1 Claimant's Release

Claimant, individually and on behalf of heirs, successors, assigns, the Estate (if applicable), and any spouse asserting derivative claims, hereby releases and forever discharges Provider, Insurer, and their respective officers, directors, employees, agents, partners, parents, subsidiaries, affiliates, insurers, reinsurers, and successors (the "Released Parties") from any and all claims, demands, actions, causes of action, damages, costs, attorney's fees, and expenses of every kind, known or unknown, arising out of or relating to the Care, the Claim, and the Action.

4.2 Wrongful-Death / Loss-of-Consortium

Where applicable, this release expressly includes wrongful-death claims under KRS § 411.130, loss-of-consortium claims under KRS § 411.145, and any survival claims of the Estate.

4.3 Informed-Consent Presumption Acknowledgment

The Parties acknowledge KRS § 304.40-320 (presumption of informed consent where consent obtained in accordance with the statute). This release covers any informed-consent claim regardless of the statutory presumption.

4.4 Mutual Release by Provider

Provider releases Claimant from any counterclaims for bills owed, contribution, or otherwise arising from the Care.

4.5 Scope

The releases are intended to be as broad as permitted by Kentucky law. Claimant has had opportunity to consult counsel and understands that unknown injuries may exist.

5. REPRESENTATIONS & WARRANTIES

5.1 Claimant has authority to release the Claim (including Estate authority where applicable).
5.2 No assignment of any portion of the Claim except as disclosed on Schedule B.
5.3 Claimant has disclosed all known liens, including Medicare, Medicaid, ERISA, hospital, and attorney's liens.
5.4 Each Party has consulted independent counsel or waived such consultation.
5.5 The Parties have authority and capacity to execute this Agreement.

6. CONFIDENTIALITY; NON-DISPARAGEMENT

6.1 Confidentiality

The terms of this Agreement and the amount of the Settlement Payment shall be kept confidential, except disclosure: (a) to attorneys, accountants, tax authorities, and lienholders on a need-to-know basis; (b) as required by law, subpoena, NPDB or board reporting; (c) to enforce this Agreement; (d) to medical/insurance providers for lien resolution.

6.2 Non-Disparagement

Each Party agrees not to make false or disparaging statements about the other. Nothing herein restricts truthful reporting to licensing boards, governmental authorities, or NPDB.

6.3 Patient Right to Report

Nothing in this Agreement prohibits Claimant from filing a grievance with the Kentucky Board of Medical Licensure, Kentucky Board of Nursing, the Joint Commission, CMS, or any other regulatory body, or from cooperating with any government investigation.

7. MEDICARE / MEDICAID / LIEN RESOLUTION

7.1 Medicare Secondary Payer

Claimant represents Medicare entitlement status: ☐ Not entitled ☐ Currently enrolled ☐ Reasonable expectation within 30 months.
Claimant shall satisfy any Medicare conditional-payment obligations under 42 U.S.C. § 1395y(b)(2) and 42 C.F.R. Part 411 prior to disbursement. Claimant indemnifies Released Parties against MSP claims.

7.2 Medicare Set-Aside

☐ Not required ☐ MSA in the amount of $[___] established per Schedule C.

7.3 Medicaid Lien

Any Kentucky Medicaid lien under KRS § 205.622 / 42 U.S.C. § 1396a(a)(25) shall be satisfied from the Settlement Payment.

7.4 Hospital / Provider Liens

Hospital liens under KRS § 376.460 et seq. shall be identified, negotiated, and satisfied from the Settlement Payment.

7.5 Section 111 Reporting

Insurer shall comply with mandatory Medicare reporting under 42 U.S.C. § 1395y(b)(8).

8. TAX TREATMENT

8.1 Section 104(a)(2)

The Parties intend that amounts allocated to personal physical injuries and physical sickness qualify for exclusion from gross income under IRC § 104(a)(2). Amounts allocated to punitive damages and pre-judgment interest are taxable.

8.2 1099 Reporting

☐ Form 1099 required for attorney's fees per IRC § 6045(f).
☐ No 1099 required for physical-injury portion paid directly to Claimant.

8.3 No Tax Advice

Each Party is responsible for its own tax obligations and has not relied on the other's tax representations.

9. NPDB / BOARD REPORTING

9.1 Mandatory NPDB Report

Insurer/Provider acknowledges that any payment made for the benefit of a practitioner in response to a written claim is reportable to the NPDB under 42 U.S.C. § 11131 within 30 days of payment.

9.2 Board Reporting

Reporting to the Kentucky Board of Medical Licensure or Kentucky Board of Nursing shall comply with KRS § 311.595 and the applicable board regulations.

9.3 No Suppression

Nothing in this Agreement is intended to suppress mandatory reporting; any provision construed to do so is void as against public policy.

10. DEFAULT & REMEDIES

10.1 Failure to make the Settlement Payment when due constitutes material breach.
10.2 Claimant's exclusive remedy for non-payment is to (a) move to enforce in the Action, (b) seek judgment for the unpaid amount plus pre-judgment interest at the rate set in KRS § 360.010 (currently 8% simple), or (c) rescind this Agreement and reinstate the Claim.
10.3 Prevailing party in enforcement entitled to reasonable attorney's fees and costs.

11. DISPUTE RESOLUTION

11.1 Governing Law — Kentucky law, without regard to conflict-of-laws principles.
11.2 Forum — Exclusive jurisdiction in [___] Circuit Court, Kentucky, where the Action was filed.
11.3 Mediation — Good-faith mediation in [Louisville / Lexington / county seat] prior to any post-settlement litigation.
11.4 Jury Waiver — ☐ Mutual jury-trial waiver to the maximum extent permitted by Kentucky law.

12. GENERAL PROVISIONS

12.1 Entire Agreement; supersedes prior negotiations.
12.2 Amendment only in writing signed by all Parties.
12.3 No waiver by course of dealing.
12.4 Severability; if any provision is invalid, the remainder remains in force.
12.5 Construction; neither Party deemed drafter.
12.6 Counterparts; electronic signatures valid under KRS § 369.101 et seq.
12.7 Notices to addresses in Section 1.1; certified mail or recognized overnight courier.
12.8 Survival; Sections 4, 6, 7, 8, and 9 survive performance.

13. EXECUTION BLOCK

The Parties have executed this Agreement as of the Effective Date. Each individual signing represents authority to bind the Party indicated.

SCHEDULES

• Schedule A — Structured Settlement Annuity Schedule (if applicable)
• Schedule B — Disclosed Assignments
• Schedule C — Medicare Set-Aside Allocation (if applicable)
• Schedule D — Lien Resolution Statements

SOURCES AND REFERENCES

• Commonwealth, Cabinet for Health & Family Servs. ex rel. Meier v. Claycomb, 566 S.W.3d 202 (Ky. 2018) (KRS ch. 216C MRP Act unconstitutional under Ky. Const. § 14)
• Williams v. Wilson, 972 S.W.2d 260 (Ky. 1998) (jural rights doctrine)
• Ky. Const. §§ 14, 54
• KRS § 304.40-320 (informed-consent presumption)
• KRS §§ 413.140(1)(e), 413.140(2) (SOL and discovery rule)
• KRS § 411.130 (wrongful death); KRS § 411.145 (consortium)
• KRS §§ 205.622 (Medicaid recovery), 376.460 (hospital liens), 360.010 (interest)
• 42 U.S.C. § 1395y(b)(2), (b)(8) (MSP / Section 111); 42 U.S.C. § 11131 et seq. (NPDB)
• IRC § 104(a)(2); IRC § 130 (qualified assignment); IRC § 6045(f)