Medical Malpractice Settlement Agreement (Michigan)

MEDICAL MALPRACTICE SETTLEMENT AGREEMENT AND MUTUAL RELEASE

(Michigan)

1. PARTIES; RECITALS

1.1 Parties

This Medical Malpractice Settlement Agreement and Mutual Release (the "Agreement") is made effective [EFFECTIVE DATE] by and among:

(a) [CLAIMANT NAME], an individual residing at [ADDRESS] ("Claimant");

(b) [DEFENDANT PROVIDER NAME, M.D./D.O.] ("Defendant Provider");

(c) [DEFENDANT HOSPITAL / PRACTICE NAME] ("Defendant Facility"); and

(d) [INSURER NAME], on behalf of Defendants ("Insurer").

Each a "Party" and collectively the "Parties."

1.2 Recitals

A. On or about [DATE OF ALLEGED MALPRACTICE], Claimant received medical care from Defendants at [FACILITY].
B. Claimant alleges that Defendants' care fell below the standard required under MCL 600.2912a and caused injury.
C. Claimant served a Notice of Intent under MCL 600.2912b on or about [DATE] and [filed / did not file] a Complaint with Affidavit of Merit under MCL 600.2912d in [___] County Circuit Court, Case No. [___] (the "Action").
D. The Parties wish to resolve all claims fully and finally, without admission of liability.

NOW, THEREFORE, in consideration of the mutual promises below, the Parties agree as follows.

2. DEFINITIONS

"Action" - The lawsuit (or pre-suit claim) defined in Recital C.

"Claims" - Any and all claims, demands, actions, causes of action, liabilities, damages, costs, and expenses, of every kind, whether known or unknown, suspected or unsuspected, in law or equity, arising out of or related to the care described in Recital A, including without limitation negligence, gross negligence, lack of informed consent, wrongful death (MCL 600.2922), survivorship, vicarious liability, ordinary negligence, and any statutory claim.

"Effective Date" - The date in Section 1.1.

"Lienholder" - Any health-plan, Medicare, Medicaid (Michigan Department of Health and Human Services), ERISA plan, Tricare, VA, hospital, attorney, or other person asserting a right of subrogation, reimbursement, or recovery against the settlement.

"Released Parties" - Defendants, Insurer, and their parents, subsidiaries, affiliates, successors, assigns, officers, directors, employees, agents, attorneys, insurers, reinsurers, and predecessors.

"Settlement Amount" - The sum in Section 3.1.

3. SETTLEMENT TERMS

3.1 Payment. Insurer, on behalf of Defendants, shall pay Claimant $[SETTLEMENT AMOUNT] (the "Settlement Amount") within [thirty (30)] days after the latest of (i) full execution of this Agreement; (ii) receipt of an executed IRS Form W-9; (iii) receipt of Medicare/Medicaid lien clearance under Section 5; and (iv) entry of an order of dismissal with prejudice in the Action (if filed).

3.2 Allocation.
| Component | Amount |
|---|---|
| Economic damages (past/future medical, wage loss) | $[___] |
| Noneconomic damages (pain, suffering, loss of consortium) | $[___] |
| Costs and case expenses | $[___] |
| Total | $[___] |

3.3 Payee; Form of Payment. Payment shall be made by [check / wire] payable to "[CLAIMANT'S COUNSEL] IOLTA Trust Account, FBO [CLAIMANT]", delivered to [ADDRESS].

3.4 Structured Settlement (Optional). [IF APPLICABLE] A portion of the Settlement Amount equal to $[___] shall be used to fund a structured settlement annuity from [ANNUITY ISSUER] under the terms in Schedule A, qualifying under 26 U.S.C. 130 and consistent with MCL 600.6306 (periodic payments).

3.5 No Admission. This Agreement is a compromise of disputed claims. Defendants expressly deny liability and any wrongdoing. Nothing in this Agreement is or shall be construed as an admission of fault, liability, or violation of any standard of care.

4. RELEASES

4.1 General Release by Claimant. In consideration of the Settlement Amount, Claimant, on behalf of Claimant and Claimant's heirs, executors, administrators, successors, and assigns, fully, finally, and forever releases and discharges the Released Parties from any and all Claims.

4.2 Wrongful-Death / Survivorship. [IF APPLICABLE] The release in Section 4.1 extends to all persons entitled to recover under MCL 600.2922 (wrongful-death) and any survivorship action under MCL 600.2921. Personal Representative warrants authority to bind all such beneficiaries and that probate approval has been (or will be) obtained where required.

4.3 Unknown Claims. Claimant expressly waives all rights with respect to claims that are unknown or unsuspected at the time of execution, intending this release to extend to all such Claims.

4.4 Indemnity Against Liens. Claimant shall indemnify, defend, and hold the Released Parties harmless from any claim by a Lienholder asserting a right of recovery against the Settlement Amount, including reasonable attorney fees. This Section 4.4 survives indefinitely.

4.5 Reservation - Future Care (Optional). [IF APPLICABLE - DELETE OTHERWISE] Claimant does not release the Released Parties for any independent and unrelated care occurring after the Effective Date.

5. LIENS, SUBROGATION, AND COLLATERAL SOURCES

5.1 Medicare Compliance. The Parties have considered Medicare's interests under 42 U.S.C. 1395y(b)(2) and 42 C.F.R. Part 411.
(a) Claimant warrants whether Claimant is [is / is not] a Medicare beneficiary, has applied for, or is reasonably expected to enroll within 30 months.
(b) Conditional Payments. Claimant shall obtain and resolve the Medicare Conditional Payment Letter / Final Demand from the Benefits Coordination & Recovery Center (BCRC) / CRC before disbursement of any portion of the Settlement Amount to Claimant.
(c) MSA (if applicable). [IF WCMSA/LMSA APPLIES] A Medicare Set-Aside in the amount of $[___] shall be funded per Schedule B.
(d) Section 111 reporting under 42 U.S.C. 1395y(b)(8) shall be made by Insurer as the Responsible Reporting Entity.

5.2 Medicaid Lien. Claimant shall resolve any lien asserted by the Michigan Department of Health and Human Services under MCL 400.106 prior to disbursement.

5.3 ERISA / Private Health Plan Liens. Claimant shall identify and resolve all ERISA plan and private health insurer subrogation interests.

5.4 Hospital and Provider Liens. Claimant shall resolve any hospital lien under the Michigan Hospital Lien Act and any provider claim.

5.5 Collateral Source. The Parties acknowledge MCL 600.6303 (collateral-source reduction) and represent that the allocation in Section 3.2 reflects the Parties' compromise of any collateral-source issue.

6. CONFIDENTIALITY AND NON-DISPARAGEMENT

6.1 Confidentiality. The terms of this Agreement, including the Settlement Amount, are confidential. Claimant and Claimant's counsel shall not disclose the terms to any third party except:
(a) To Claimant's accountants, tax advisors, and attorneys under a duty of confidence;
(b) To Lienholders and taxing authorities as required by law;
(c) To immediate family on a need-to-know basis;
(d) As required by court order, subpoena, or applicable law (after reasonable notice to Insurer where lawful); and
(e) To enforce this Agreement.

6.2 Non-Disparagement. The Parties shall refrain from making public statements that disparage another Party in connection with the Action, without limiting any Party's right to make truthful statements required by law, in court filings, or to regulators.

6.3 Permitted Disclosures. Nothing in this Agreement limits any Party's right to (i) communicate with the Michigan Board of Medicine / Osteopathic Medicine, LARA, or any government regulator; (ii) respond to a subpoena; (iii) cooperate with NPDB reporting; or (iv) exercise rights under Section 7 of the NLRA (where applicable).

7. REPRESENTATIONS AND WARRANTIES

7.1 Authority. Each Party represents authority to execute and perform this Agreement.
7.2 Capacity; Counsel. Claimant represents Claimant is legally competent, has read this Agreement, has had the opportunity to consult Claimant's chosen counsel, and signs voluntarily.
7.3 No Assignment. Claimant has not assigned, transferred, or pledged any Claim.
7.4 Probate (if applicable). [IF WRONGFUL DEATH/MINOR] Probate court approval has been obtained or will be obtained under MCR 5.409 / MCL 700.5102.
7.5 NPDB Acknowledgment. Claimant acknowledges that Insurer is required by 42 U.S.C. 11131 and 45 C.F.R. Part 60 to report this payment to the National Practitioner Data Bank. Nothing in Section 6 is intended to prohibit lawful NPDB reporting.

8. TAX TREATMENT

8.1 The Parties intend that compensation for personal physical injuries and physical sickness be excluded from Claimant's gross income under 26 U.S.C. 104(a)(2). Any portion allocated to non-physical claims, punitive damages, or interest may be taxable. Each Party shall be solely responsible for its own tax liability, and no Party has provided tax advice to any other. Claimant shall furnish IRS Form W-9.

9. DISMISSAL; FURTHER ASSURANCES

9.1 Dismissal. Within [ten (10)] business days after receipt of the Settlement Amount, Claimant shall file a Stipulation and Order of Dismissal With Prejudice and Without Costs in the Action.
9.2 Further Assurances. Each Party shall execute such additional documents (including the Insurer's standard release if not duplicative, an MCR 2.602 order of dismissal, IRS Form W-9, and any lien-resolution forms) as reasonably necessary to effectuate this Agreement.

10. DEFAULT AND REMEDIES

10.1 Default. Failure to pay any undisputed monetary obligation within 10 business days after written notice, or material breach of any other term not cured within 30 days after written notice.
10.2 Remedies. The non-defaulting Party may pursue specific performance, damages, and reasonable attorney fees and costs.

11. DISPUTE RESOLUTION

11.1 Governing Law. Michigan law governs, without regard to conflict-of-laws principles.
11.2 Forum. Exclusive venue: the Circuit Court for [___] County, Michigan.
11.3 Optional Arbitration. Any dispute concerning the enforcement or interpretation of this Agreement (but not the underlying Claims, which are released) may, on written mutual consent, be submitted to binding arbitration under MCL 691.1681 et seq. in [CITY], Michigan, before a single neutral arbitrator.
11.4 Attorney Fees. The prevailing Party in any enforcement action is entitled to reasonable attorney fees and costs.

12. GENERAL PROVISIONS

12.1 Entire Agreement. This Agreement and its Schedules constitute the entire agreement and supersede all prior communications and writings.
12.2 Amendments. Only in writing signed by all Parties.
12.3 Severability. If any provision is invalid, the remainder remains in effect, and the court may reform the provision to the minimum extent necessary.
12.4 Counterparts; Electronic Signatures. Counterparts and electronic signatures are effective under the Michigan Uniform Electronic Transactions Act, MCL 450.831 et seq.
12.5 Notices. In writing, by personal delivery, overnight courier, or certified mail (return receipt) to the addresses below.
12.6 No Drafter Presumption. This Agreement was jointly negotiated; no presumption against the drafter applies.
12.7 Binding Effect. This Agreement binds and benefits the Parties and their respective heirs, successors, and assigns.

13. EXECUTION

The Parties acknowledge that they have read this Agreement, understand its terms, and execute it voluntarily.

State of Michigan, County of [___]: Acknowledged before me on [DATE] by [NAME].

Notary Public: ____________________ My commission expires: ____________

14. SCHEDULES

• Schedule A - Structured Settlement Annuity Terms (if applicable)
• Schedule B - Medicare Set-Aside Allocation (if applicable)
• Schedule C - Schedule of Lienholders and Resolution Status
• Schedule D - Probate / Wrongful-Death Beneficiary Allocation (MCL 600.2922) (if applicable)

SOURCES AND REFERENCES

• MCL 600.1483 (Noneconomic damages cap; 2025: $586,300 / $1,047,000 per Michigan Treasury Jan. 31, 2025 notice; verify current year)
• MCL 600.2912a (Standard of care); MCL 600.2912b (NOI - 182 days); MCL 600.2912d (Affidavit of Merit); MCL 600.2912e (Counter-Affidavit)
• MCL 600.5805(8) and 600.5838a (Statute of limitations - 2 years / 6 months discovery / 6-year repose)
• MCL 600.2922 (Wrongful death); MCL 600.6303 (Collateral source); MCL 600.6304 (Allocation of fault); MCL 600.6306 (Periodic payments)
• MCL 400.106 (Michigan Medicaid recovery)
• 42 U.S.C. 11131 et seq.; 45 C.F.R. Part 60 (NPDB)
• 26 U.S.C. 104(a)(2); 26 U.S.C. 130 (qualified assignments)
• 42 U.S.C. 1395y(b)(2), (b)(8); 42 C.F.R. Part 411 (Medicare Secondary Payer; Section 111 reporting)

Pre-execution checklist:
☐ Verify current MCL 600.1483 cap from most recent Michigan Treasury notice
☐ Confirm Medicare conditional payment / final demand resolved
☐ Confirm Medicaid (MDHHS) lien resolved
☐ Confirm ERISA / private health plan liens identified and resolved
☐ Confirm probate approval (minor / wrongful-death) if applicable
☐ Confirm NPDB reporting acknowledged
☐ Confirm W-9 obtained
☐ Confirm dismissal order prepared (MCR 2.602)