Medical Malpractice Settlement Agreement (North Carolina)

CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE

(North Carolina Medical Malpractice — Comprehensive Template)

1. PARTIES AND CASE INFORMATION

This Confidential Settlement Agreement and Release (the "Agreement") is entered into as of [__/__/____] (the "Effective Date") by and among:

Underlying Matter. Pending or threatened action captioned [CASE NAME], Case No. [__________], in the [General Court of Justice, Superior Court Division, _____ County, NC / U.S. District Court for the _____ District of NC], alleging medical negligence under N.C.G.S. § 90-21.11 et seq. in connection with care rendered on or about [__/__/____] at [FACILITY] (the "Incident").

2. RECITALS

A. Releasor alleges that Released Parties breached the standard of care of the same or similar community under N.C.G.S. § 90-21.12, proximately causing injury.

B. Released Parties deny all liability, deny breach of the standard of care, and deny causation.

C. Releasor obtained, or would have obtained, the pre-filing expert certification required by N.C.G.S. § 1A-1, Rule 9(j).

D. The Parties wish to avoid the expense, delay, and uncertainty of further litigation and have agreed to compromise and resolve all claims on the terms below.

E. Compromise of a disputed claim does not constitute an admission of liability or wrongdoing by any Released Party.

3. SETTLEMENT PAYMENT

3.1 Total Settlement Amount. Released Parties / Insurer shall pay the total sum of $[AMOUNT] (the "Settlement Amount") in full and final settlement of all claims.

3.2 Allocation (for tax and lien purposes under IRC § 104(a)(2)):

3.3 NC Noneconomic Damages Cap. The Parties acknowledge the noneconomic damages cap under N.C.G.S. § 90-21.19, currently $[CURRENT CAP] as adjusted by the NC Office of State Budget and Management. The allocated noneconomic damages amount in Section 3.2 reflects the Parties' compromise valuation and is not an admission as to applicability of the cap.

3.4 Payment Terms.

• ☐ Lump sum within [30] days of execution and resolution of all liens.
• ☐ Structured settlement per Exhibit A (annuity provider: [___]).
• ☐ Combination — lump sum of $[____] plus structured payments per Exhibit A.

3.5 Payee. Payment shall be made to "[ATTORNEY TRUST ACCOUNT / RELEASOR]" at the address in Section 14, by wire or check, less amounts withheld under Section 5 (liens).

3.6 Form 1099 / Reporting. Insurer shall issue IRS Form 1099-MISC only with respect to taxable portions; amounts allocated to personal physical injury / sickness under IRC § 104(a)(2) are not reportable as income.

4. RELEASE OF CLAIMS

4.1 General Release. Releasor, on behalf of Releasor, Releasor's heirs, successors, assigns, executors, administrators, and representatives, fully and forever releases, acquits, and discharges Released Parties (and their employees, agents, officers, directors, insurers, successors, and assigns) from any and all claims, demands, actions, causes of action, damages, costs, expenses, and liabilities of every kind, known or unknown, accrued or to accrue, arising out of or related to the Incident, including all medical malpractice claims under N.C.G.S. § 90-21.11 et seq., common-law negligence, lack of informed consent, wrongful death (N.C.G.S. § 28A-18-2), and any derivative claims.

4.2 Unknown Claims. Releasor expressly assumes the risk of unknown injuries, conditions, or consequences and waives any right to assert any such later-discovered claim arising out of the Incident.

4.3 Dismissal. Within [10] days of receipt of the Settlement Amount, Releasor shall file a Stipulation of Dismissal With Prejudice of the Underlying Matter under N.C.G.S. § 1A-1, Rule 41.

4.4 No Admission. Released Parties expressly deny liability; settlement is a compromise of disputed claims.

5. LIEN RESOLUTION AND HOLD HARMLESS

5.1 Lien Identification. Releasor represents that the following liens, subrogation interests, or rights of reimbursement are known or asserted:

☐ Medicare conditional payments (42 U.S.C. § 1395y(b)(2)) — CMS Case No. [__________]
☐ Medicaid (42 U.S.C. § 1396a(a)(25); N.C.G.S. § 108A-57) — NC DHHS Reference No. [__________]
☐ ERISA health plan / private insurer subrogation — Plan: [__________]
☐ TRICARE / VA / Indian Health Service
☐ Hospital/provider statutory lien (N.C.G.S. § 44-49 et seq.)
☐ Child support lien / IV-D claim
☐ Workers' compensation lien (N.C.G.S. § 97-10.2)
☐ Other: [__________]

5.2 Medicare Compliance. The Parties have considered Medicare's interests, including (a) reimbursement of conditional payments and (b) future medicals for Medicare beneficiaries / reasonably-expected beneficiaries within 30 months. A Medicare Set-Aside Arrangement (MSA) in the amount of $[____] ☐ is / ☐ is not established.

5.3 Withholding and Payment. From the Settlement Amount, the following shall be withheld and paid directly to lienholders before disbursement to Releasor:

5.4 Hold Harmless. Releasor shall indemnify, defend, and hold harmless Released Parties and Insurer from any claim, demand, or action by any lienholder, subrogee, or other party asserting a right of reimbursement out of the Settlement Amount.

6. CONFIDENTIALITY

6.1 Confidentiality of Terms. The terms of this Agreement, including the Settlement Amount, are strictly confidential. Releasor and Releasor's counsel shall not disclose any term except:

• (a) To Releasor's spouse, accountant, tax preparer, financial advisor, and attorneys, each of whom must be advised of and agree to this confidentiality obligation;
• (b) As required by court order, subpoena, or legal process (with prompt notice to Released Parties before disclosure where lawful);
• (c) To the IRS, CMS, NC DHHS, or other taxing/lien authority as required;
• (d) For NPDB reporting required by Released Parties under federal law.

6.2 No Disparagement. The Parties shall not make any public statement disparaging any other Party regarding the Incident.

6.3 Liquidated Damages. ☐ [Optional] Material breach of Section 6.1 by Releasor shall entitle Released Parties to liquidated damages of $[____] per disclosure, the Parties agreeing actual damages would be difficult to quantify.

6.4 Permitted Disclosures. Nothing in this Agreement prohibits or restricts any Party from communicating with the NC Medical Board, CMS, NPDB, law enforcement, or any governmental agency, or from responding truthfully to a lawful subpoena or court order.

7. NPDB AND REGULATORY REPORTING

7.1 NPDB Report. Released Parties / Insurer acknowledge that any payment on behalf of a licensed practitioner in settlement of a written claim must be reported to the National Practitioner Data Bank pursuant to 42 U.S.C. § 11131 and 45 C.F.R. Part 60. Releasor acknowledges that nothing in this Agreement prevents or restricts such reporting.

7.2 NC Medical Board. Released Parties' obligation to self-report (if any) under 21 NCAC 32 and N.C.G.S. § 90-14.13 is not impaired by this Agreement.

7.3 Subject of Report. A copy of any NPDB report shall be provided to the Released Provider upon request consistent with federal procedure.

8. TAX TREATMENT

8.1 IRC § 104(a)(2). The Parties intend that all amounts allocated in Section 3.2 to compensation for personal physical injury or physical sickness (or emotional distress originating from physical injury) shall be excluded from Releasor's gross income under IRC § 104(a)(2) and not be reportable as wages.

8.2 Independent Tax Advice. Releasor acknowledges receiving no tax advice from Released Parties or Insurer and has consulted independent tax counsel.

8.3 Withholding. No Party shall withhold income or employment taxes from amounts excluded under § 104(a)(2). Amounts allocated to lost wages or punitive damages, if any, may be subject to reporting.

9. WRONGFUL DEATH / MINOR / INCAPACITATED CLAIMANT APPROVAL

9.1 Wrongful Death. If applicable, this Agreement is subject to approval by the Clerk of Superior Court / Superior Court Judge under N.C.G.S. § 28A-13-3(a)(23) and N.C.G.S. § 28A-18-2, and is contingent upon entry of an order approving settlement and authorizing distribution to statutory beneficiaries.

9.2 Minor / Incapacitated Adult. If Releasor is a minor or incapacitated adult, this Agreement is subject to approval by the Superior Court under N.C.G.S. § 1A-1, Rule 17 and applicable rules governing guardian ad litem approval.

10. ADDITIONAL UNDERTAKINGS

10.1 No Refiling. Releasor shall not file, refile, or maintain any action arising out of the Incident in any forum.

10.2 Confidential Medical Records. Released Parties may retain copies of Releasor's medical records for purposes of defense, insurance, audit, and regulatory compliance.

10.3 Cooperation. The Parties shall execute such further documents (W-9, lien releases, Medicare reporting forms, dismissal stipulations) as reasonably necessary to effectuate this Agreement.

11. REPRESENTATIONS AND WARRANTIES

11.1 Releasor represents that Releasor:

• (a) Has had the opportunity to consult with independent counsel of Releasor's choice;
• (b) Has full authority and capacity to enter into this Agreement;
• (c) Has not assigned any claim covered by this release;
• (d) Has disclosed all known liens and subrogation interests in Section 5.1; and
• (e) Is not relying on any representation not set forth herein.

12. DISPUTE RESOLUTION

12.1 Governing Law. This Agreement is governed by NC law without regard to conflicts principles.

12.2 Forum. Exclusive jurisdiction for enforcement: state courts of [COUNTY] County, NC.

12.3 Attorneys' Fees. Prevailing party in enforcement action recovers reasonable attorneys' fees and costs.

13. GENERAL PROVISIONS

13.1 Entire Agreement. This Agreement supersedes all prior negotiations and agreements concerning its subject matter.

13.2 Amendments. Only in a writing signed by all Parties.

13.3 Severability. Invalid provisions severable; remainder enforceable.

13.4 Counterparts; Electronic Signatures. May be executed in counterparts; electronic signatures valid.

13.5 Construction. Drafted jointly; no presumption against drafter.

13.6 Headings. For convenience only.

14. NOTICES AND SIGNATURES

Notarization (recommended for Releasor):
State of North Carolina, County of [_______]. Sworn to and subscribed before me this [__] day of [_______, ____].
Notary Public: __________________________ My Commission Expires: ________

EXHIBITS

• Exhibit A — Structured Settlement / Annuity Schedule (if applicable)
• Exhibit B — Stipulation of Dismissal With Prejudice (Rule 41)
• Exhibit C — Medicare Set-Aside Arrangement (if applicable)
• Exhibit D — Lien Resolution Documentation
• Exhibit E — Court Order Approving Settlement (minor / wrongful death, if applicable)

SOURCES AND REFERENCES

• N.C.G.S. § 90-21.19 (Noneconomic damages cap — adjusted every 3 years by NC OSBM)
• N.C.G.S. § 1A-1, Rule 9(j) (Pre-filing expert certification)
• N.C.G.S. § 90-21.12 (Standard of care — same or similar community)
• N.C.G.S. § 90-21.11 et seq. (NC Medical Malpractice Actions)
• N.C.G.S. § 1-15(c) (Statute of limitations/repose: 3 years / 4-year repose)
• N.C.G.S. § 28A-18-2 (Wrongful Death)
• N.C.G.S. § 44-49 et seq. (Hospital/provider liens)
• 42 U.S.C. § 11131 et seq.; 45 C.F.R. Part 60 (NPDB)
• 42 U.S.C. § 1395y(b)(2) (Medicare Secondary Payer); 42 U.S.C. § 1396a(a)(25) (Medicaid)
• IRC § 104(a)(2) (Tax exclusion for personal physical injury damages)
• NC Office of State Budget and Management — current cap figure: https://www.osbm.nc.gov/facts-figures/economy/liability-limit-noneconomic-damages-medical-malpractice

This template is for informational purposes only and must be reviewed by NC-licensed counsel before use. Verify the current N.C.G.S. § 90-21.19 cap with NC OSBM before finalizing any settlement.