Severe burns covering thirty percent of your body left you facing years of reconstructive surgeries, physical therapy, psychological treatment, and ongoing medical monitoring. Your initial hospital stay alone cost $400,000, but your doctors say you’ll need medical care for the rest of your life. The insurance company offered $600,000 to settle your case, and you have no idea whether that amount will actually cover decades of future treatment.
Our friends at The Edelsteins, Faegenburg, & Blyakher LLP discuss how calculating lifetime medical costs requires specialized professional analysis that most injury victims don’t understand. As a burn injury lawyer will tell you, burn injury settlements that don’t properly account for future care needs leave victims financially devastated when the money runs out but the medical needs continue for decades.
Why Burn Injuries Create Unique Cost Calculations
Unlike broken bones that heal within months, severe burns create permanent damage requiring lifelong medical intervention. Scar tissue doesn’t function like normal skin. It doesn’t stretch, doesn’t regulate temperature, and breaks down over time requiring replacement.
According to the American Burn Association, severe burn injuries often require multiple reconstructive surgeries over many years to address contractures, improve function, and reduce scarring. Each surgery brings hospitalization costs, rehabilitation expenses, and lost wages during recovery.
These ongoing medical needs don’t end after a few years. They continue for life, with costs compounding over decades as inflation drives medical expenses higher.
The Role Of Life Care Planners
Life care planners are medical professionals, typically nurses with specialized training, who evaluate burn victims and create comprehensive plans projecting all future medical needs. They work with treating physicians, burn specialists, physical therapists, and other providers to understand the full scope of required care.
Their life care plans detail every expected surgery, therapy session, medication, medical device, home modification, and healthcare service the burn victim will need from now until life expectancy. Each item includes current costs and projections for future expense growth.
These plans transform vague predictions about “needing ongoing care” into specific, itemized forecasts that economists can value and juries can understand.
Components Of Long-Term Burn Care
Future burn care encompasses far more than most people realize. Reconstructive surgeries to release contractures and restore function occur regularly throughout the victim’s lifetime. Scar revision procedures improve appearance and reduce pain from tight, binding scar tissue.
Skin grafts require ongoing monitoring and sometimes replacement when grafted skin fails. Physical therapy maintains range of motion and prevents contractures from worsening. Occupational therapy helps victims relearn daily living activities and adapt to physical limitations.
Psychological counseling addresses trauma, depression, anxiety, and body image issues that accompany severe disfigurement. Pain management through medications, procedures, and specialized treatment helps victims cope with chronic pain from damaged nerves and tight scar tissue.
Compression garments must be worn continuously and replaced regularly as they wear out or the victim’s body changes. Specialized scar treatment including laser therapy, steroid injections, and silicone sheeting reduces scarring over time but requires repeated applications.
Calculating Costs Over A Lifetime
Life care plans project costs for each medical service over the victim’s remaining life expectancy. A 25-year-old burn victim might need care for 50 or 60 more years. Every projected expense must be calculated across this timeframe.
The calculation starts with current costs. What does a reconstructive surgery cost today? What do compression garments cost annually? What does physical therapy cost per session?
These current costs then get projected forward accounting for medical inflation, which historically exceeds general inflation. Healthcare costs have risen approximately 3% to 5% annually above general inflation rates over recent decades.
The projected annual costs for each service get added together for each year of remaining life expectancy, creating a year-by-year cost projection spanning decades.
Present Value Reduction
Future costs can’t simply be added together and paid as a lump sum. Money received today can be invested and will grow over time through interest and returns. Therefore, future costs must be “discounted to present value” using economic calculations.
If you’ll need a $50,000 surgery in 20 years, you don’t need $50,000 today. You need roughly $30,000 today which, if invested conservatively, will grow to $50,000 in 20 years when the surgery occurs.
Economists calculate present value using discount rates that account for expected investment returns. Different discount rates produce vastly different present value calculations, making this a contentious issue in settlement negotiations.
Medical Inflation Vs Investment Returns
The interplay between medical inflation and investment returns determines how much money is needed today to cover future care. Medical costs rise faster than general inflation, but invested settlement proceeds should earn returns offsetting some of that growth.
Conservative calculations assume low investment returns and high medical inflation, requiring larger present value amounts. Aggressive calculations assume higher returns and lower inflation, reducing present value requirements.
Defense economists use aggressive assumptions minimizing present value calculations. Plaintiff economists use conservative assumptions maximizing required settlements. The gap between these competing calculations can be millions of dollars in severe burn cases.
Age And Life Expectancy Impact
Younger burn victims require larger settlements because their care needs span more years. A 20-year-old needing care for 60 years requires far more money than a 70-year-old needing care for 15 years.
Life expectancy tables provide baseline predictions, but individual health factors adjust these predictions. Severe burns sometimes reduce life expectancy through increased infection risk, cardiovascular stress, and other complications. Life care plans account for these mortality impacts.
Home Modifications And Adaptive Equipment
Beyond medical treatment, burn victims often need home modifications accommodating physical limitations. Wheelchair ramps, modified bathrooms, specialized beds, and accessible living spaces require substantial investment.
Adaptive equipment including wheelchairs, walkers, reaching devices, and specialized utensils help victims function independently. This equipment wears out and needs replacement multiple times over a lifetime.
These costs get incorporated into life care plans alongside medical expenses, often adding hundreds of thousands to lifetime cost projections.
Lost Earning Capacity
While not technically medical costs, burn injuries typically cause permanent reductions in earning capacity that get calculated alongside future care costs. Disfigurement, physical limitations, and ongoing medical needs prevent many burn victims from returning to previous employment.
The combination of reduced earning capacity and increased lifetime medical expenses creates devastating financial impact requiring comprehensive compensation.
Attendant Care And Personal Assistance
Severe burns sometimes require lifetime personal assistance with daily activities. Attendant care costs for help with bathing, dressing, meal preparation, and household tasks can exceed medical costs when needed daily.
Life care plans quantify how many hours of attendant care victims need daily and project those costs across remaining life expectancy. For young victims, attendant care costs can reach several million dollars.
Medication Costs Over Decades
Pain medications, anti-inflammatory drugs, antibiotics for recurring infections, and other prescriptions become lifetime expenses. While individual prescriptions might cost modest amounts monthly, 40 or 50 years of continuous medications total substantial sums.
Brand name versus generic medications, insurance coverage changes, and drug price inflation all affect long-term medication cost projections.
The Medicare Set-Aside Consideration
When Medicare beneficiaries settle injury cases, Medicare requires consideration of future medical costs that might otherwise be billed to Medicare. Medicare Set-Aside accounts ensure settlement funds are available for future injury-related care before Medicare pays anything.
These requirements add complexity to settlement calculations and reduce amounts available for non-medical expenses and attorney fees.
Negotiating With Opposing Economists
Defense attorneys hire economists who minimize life care costs using aggressive assumptions. They argue shorter life expectancies, higher discount rates, lower medical inflation, and reduced treatment needs.
Countering these defense positions requires credible life care plans from qualified professionals and economic testimony supporting conservative assumptions that actually protect burn victims’ long-term interests.
Structured Settlements For Burn Victims
Given the long-term nature of burn care costs, structured settlements providing periodic payments over decades often make more sense than lump sums. Structured payments can be timed to coincide with predicted medical expenses, providing funds when needed.
Tax-free growth in structured settlements also helps money last longer compared to taxable investment returns on lump sum settlements.
The Danger Of Inadequate Settlements
Burn victims who settle for inadequate amounts exhaust their settlement funds years before their care needs end. They then face either going without necessary medical treatment or relying on government benefits that provide minimal care.
This financial catastrophe becomes permanent and irreversible once settlement releases are signed. There’s no second chance to get additional compensation when the money runs out but decades of life remain.
If you’ve suffered severe burn injuries and face lifetime medical needs, or you’re negotiating a settlement and aren’t sure whether the offered amount will actually cover decades of future treatment, reach out to discuss how life care planners calculate long-term medical costs, what future expenses should be included in your settlement demand, how to counter defense economists who minimize your needs, and whether the settlement offer adequately protects your financial security for the rest of your life.