When Life Expectancy = Dollars

When Life Expectancy = Dollars

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Up-to-date population statistics can help your clients maximize their recoveries. When calculating future damages—such as medical specials, lost earning capacity, or general damages—a plaintiff’s life expectancy is a critical factor in any valuation. In California, the life expectancy tables found in the CACI are the standard reference. However, these tables are based on data published in the 2015 National Vital Statistics Reports, which relied on old data from 2011.

It may be time to adopt more current data. CMS recently announced that, beginning October 12, 2019, it will begin using a new set of mortality tables reported in the National Vital Statistics Reports. These updated tables are based on 2016 data and, in some demographic groups, reflect increased life expectancies.

Because this updated data is more accurate and often more favorable to plaintiffs, life care planners and trial courts should consider adopting it. Some plaintiffs may see a meaningful increase in life expectancy, which in turn could significantly raise the value of future damages. For example, under the 2011 data, a 61-year-old male had a life expectancy of 20.8 years. Under the 2016 tables, that number rises to 22.5 years.

We have already begun using the updated mortality tables in our evaluation of Medicare Set Aside issues. As we prepare for the expected rules governing Liability Medicare Set Asides (LMSAs), our obligation—as outlined in CMS guidance—remains to “act reasonably” to protect Medicare’s interests.

By calculating future medical specials using the same mortality tables adopted by CMS, we minimize disputes over assumptions and focus on the substantive issues that truly matter in the settlement process. Doing so helps protect both plaintiffs and their counsel—now and into the future.

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