Title: Matthew Ferdon v. Wisconsin Patients Compensation Fund

State: wisconsin

Issuer: Wisconsin Supreme Court

Document:

2005 WI 125 
 
 
SUPREME COURT OF WISCONSIN 
 
 
 
 
 
CASE NO.: 
2003AP988 
COMPLETE TITLE: 
 
 
Matthew Ferdon, by his Guardian ad Litem,  
Vincent R. Petrucelli, Cynthia Ferdon and  
Dennis Ferdon,  
          Plaintiffs-Appellants-Petitioners, 
     v. 
Wisconsin Patients Compensation Fund,  
Medical Protective Company, Michael J.  
Brockman, M.D., and Aurora Health Care,  
Inc., d/b/a Bay West Gynecology &  
Obstetrics, Ltd.,  
          Defendants-Respondents, 
Connecticut General Life Insurance  
Company, a/k/a Cigna Insurance, f/k/a  
Healthsource Provident Administrators,  
Inc., a/k/a Healthsource Provident, and  
County of Oconto,  
          Nominal-Defendants. 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
(no cite) 
 
 
OPINION FILED: 
July 14, 2005   
SUBMITTED ON BRIEFS: 
        
ORAL ARGUMENT: 
April 26, 2005  
 
 
SOURCE OF APPEAL: 
 
 
COURT: 
Circuit   
 
COUNTY: 
Brown   
 
JUDGE: 
Peter Naze   
 
 
 
JUSTICES: 
 
 
CONCURRED: 
CROOKS, J., concurs (opinion filed). 
BUTLER, JR., J., joins the concurrence.   
 
DISSENTED: 
PROSSER, J., dissents (opinion filed). 
WILCOX and ROGGENSACK, J.J., join the dissent. 
ROGGENSACK, J., dissents. 
WILCOX and PROSSER, J.J., join the dissent.   
 
NOT PARTICIPATING:         
 
 
 
ATTORNEYS: 
 
For the plaintiffs-appellants-petitioners there were briefs 
by Vincent R. Petrucelli and Petrucelli & Petrucelli, P.C., Iron 
River, MI, and oral argument by Marie A. Stanton and Merrick R. 
Domnitz.  
 
 
2
 
For 
the 
defendant-respondent 
Wisconsin 
Patients 
Compensation Fund there was a brief by Steven P. Means, 
Christine Cooney Mansour, Roisin H. Bell and Michael Best & 
Friedrich, LLP, Madison, and oral argument by Steven P. Means. 
 
An amicus curiae brief was filed by Michael B. VanSicklen, 
Roberta F. Howell and Foley & Lardner, LLP, Madison, on behalf 
of Physicians Insurance Company of Wisconsin and the Property 
Casualty Insurers Association of America; and by Eric Englund, 
Madison, on behalf of the Wisconsin Insurance Alliance. 
 
An amicus curiae brief was filed by Timothy J. Muldowney, 
Jennifer L. Peterson and LaFollette Godfrey & Kahn, Madison, and 
Melanie Cohen, Madison, on behalf of the Wisconsin Medical 
Society and the American Medical Association. 
 
An amicus curiae brief was filed by D. James Weis, Robert 
L. Jaskulski and Habush Habush & Rottier, S.C., Milwaukee, on 
behalf of the Wisconsin Academy of Trial Lawyers. 
 
An amicus curiae brief was filed by Colleen D. Ball and 
Appellate Counsel, S.C., Wauwatosa, on behalf of Wisconsin 
Coalition for Civil Justice and Wisconsin Manufacturers and 
Commerce. 
 
An amicus curiae brief was filed by Thomas M. Pyper, 
Cynthia L. Buchko and Whyte Hirschboeck Dudek S.C., Madison, on 
behalf of The Wisconsin Hospital Association, Inc. and The 
American Hospital Association. 
 
 
2005 WI 125
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
 
No.  2003AP988  
(L.C. No. 
2001CV1897) 
STATE OF WISCONSIN  
 
 
   : 
IN SUPREME COURT 
 
 
Matthew Ferdon, by his Guardian ad Litem,  
Vincent R. Petrucelli, Cynthia Ferdon and  
Dennis Ferdon,  
 
          Plaintiffs-Appellants- 
          Petitioners, 
 
     v. 
 
Wisconsin Patients Compensation Fund,  
Medical Protective Company, Michael J.  
Brockman, M.D., and Aurora Health Care,  
Inc., d/b/a Bay West Gynecology &  
Obstetrics, Ltd.,  
 
          Defendants-Respondents, 
 
Connecticut General Life Insurance  
Company, a/k/a Cigna Insurance, f/k/a  
Healthsource Provident Administrators,  
Inc., a/k/a Healthsource Provident, and  
County of Oconto,  
 
          Nominal-Defendants. 
 
FILED 
 
JUL 14, 2005 
 
Cornelia G. Clark 
Clerk of Supreme Court 
 
 
 
 
 
REVIEW of a decision of the Court of Appeals.  Reversed and 
remanded.   
 
No. 
2003AP988   
 
2 
 
¶1 
SHIRLEY S. ABRAHAMSON, C.J.   This is a review of a 
summary order1 of the court of appeals affirming a judgment of 
the circuit court for Brown County, Peter J. Naze, Judge.  The 
judgment in this medical malpractice action was in favor the 
Wisconsin Patients Compensation Fund (Fund)2 and against Matthew 
Ferdon.   
¶2 
This medical malpractice action arose as a result of a 
doctor's negligence that injured Matthew Ferdon during birth.  
Despite surgeries, he has a partially paralyzed and deformed 
right arm.   
¶3 
A jury awarded Matthew Ferdon $700,000 in noneconomic 
damages for injuries caused by medical malpractice and $403,000 
for future medical expenses.  The jury heard that Matthew Ferdon 
had a life expectancy of 69 years.  Therefore, the jury's 
noneconomic damage award reflects an award of slightly more than 
$10,000 a year as the reasonable amount necessary to compensate 
Matthew Ferdon for having to live every day of his life with a 
partially functioning, deformed right arm.       
¶4 
After 
the 
verdict 
the 
Fund 
moved 
to 
have 
the 
noneconomic 
damages 
reduced 
pursuant 
to 
the 
limitation 
established in Wis. Stat. §§ 655.017 and 893.55(4)(d) (2001-02).3  
                                                 
1 Ferdon v. Wis. Patients Comp. Fund, No. 2003AP988, 
unpublished order (Wis. Ct. App. Feb. 10, 2004). 
2 The name of the Fund was recently changed to "Injured 
Patients and Families Compensation Fund."  See 2003 Wis. Act 
111. 
3 All references to Wisconsin Statutes are to the 2001-02 
version unless otherwise noted. 
No. 
2003AP988   
 
3 
 
The statutory limitation (sometimes called a cap) on the jury 
award means that 
Matthew 
Ferdon 
will 
have 
an 
award of 
approximately $5,900 a year as the reasonable amount necessary 
to compensate him for living with a partially functioning, 
deformed right arm.   
¶5 
The Fund also moved to have that portion of the award 
for future medical expenses exceeding $100,000 deposited into a 
state-administered fund pursuant to Wis. Stat. § 655.015.   
¶6 
The circuit court granted both of the Fund's motions.  
The court of appeals summarily affirmed the judgment of the 
circuit court, and this court granted review. 
¶7 
Three questions are presented in the instant case: 
¶8 
First, 
is 
the 
$350,000 
statutory 
limitation 
on 
noneconomic damages resulting from a medical malpractice injury 
in Wis. Stat. §§ 655.017 and 893.55(4)(d) constitutional?   
¶9 
Matthew Ferdon challenges the statutory limitation on 
noneconomic damages in medical malpractice actions on several 
grounds.  He asserts that the mandatory statutory limitation (1) 
violates the equal protection guarantees of the Wisconsin 
Constitution;4 (2) violates the right to a trial by jury as 
                                                 
4 Article I, Section 1 reads as follows: 
Equality; inherent rights.  Section 1.  All people are 
born equally free and independent, and have certain 
inherent rights; among these are life, liberty and the 
pursuit 
of 
happiness; 
to 
secure 
these 
rights, 
governments are instituted, deriving their just powers 
from the consent of the governed. 
No. 
2003AP988   
 
4 
 
provided in Article I, Section 5 of the Wisconsin Constitution;5 
(3) violates the right to a remedy as provided in Article I, 
Section 9 of the Wisconsin Constitution;6 (4) violates the due 
process clause of the Wisconsin Constitution;7 and (5) violates 
the separation of powers doctrine by infringing remittitur, a 
core judicial power, contrary to Article VII, Section 2 of the 
Wisconsin Constitution.8  The circuit court held the statutory 
limitation was constitutional; the court of appeals agreed.  
                                                 
5 Article I, Section 5 reads as follows:   
Trial by jury; verdict in civil cases.  Section 5.  
The right of trial by jury shall remain inviolate, and 
shall extend to all cases at law without regard to the 
amount in controversy . . . . 
6 Article I, Section 9 reads as follows: 
Remedy for wrongs. Section 9.  Every person is 
entitled to a certain remedy in the laws for all 
injuries, or wrongs which he may receive in his 
person, property, or character; he ought to obtain 
justice freely, and without being obliged to purchase 
it, 
completely and 
without denial, promptly and 
without delay, conformably to the laws. 
7 Due process, like equal protection, is guaranteed by 
Article I, Section 1 of the Wisconsin Constitution: "All people 
are born equally free and independent, and have certain inherent 
rights; among these are life, liberty and the pursuit of 
happiness; to secure these rights, governments are instituted, 
deriving their just powers from the consent of the governed."  
8 Article VII, Section 2 reads as follows: 
Court System.  Section 2.  The judicial power of this 
state shall be vested in a unified court system 
consisting of one supreme court, a court of appeals, a 
circuit court, such trial courts of general uniform 
statewide jurisdiction as the legislature may create 
by law, and a municipal court if authorized by the 
legislature under section 14. 
No. 
2003AP988   
 
5 
 
¶10 We hold that the $350,000 cap (adjusted for inflation) 
on noneconomic medical malpractice damages set forth in Wis. 
Stat. §§ 655.017 and 893.55(4)(d) violates the equal protection 
guarantees of the Wisconsin Constitution.  We therefore need 
not, and do not, address Matthew Ferdon's other constitutional 
challenges to the cap.  We remand the cause to the circuit court 
for further proceedings not inconsistent with this opinion. 
¶11 Second, 
if 
the 
statutory 
limitation 
is 
unconstitutional, is the Fund liable for payment of the amount 
of the jury award in excess of the statutory limitation?  The 
Fund argues it need not pay the excess amount.  Matthew Ferdon 
does not brief this question.  The circuit court and court of 
appeals did not answer this question.  We therefore remand this 
question to the circuit court so that the parties may be heard 
on it. 
¶12 Third, is Wis. Stat. § 655.015, which requires the 
portion of the jury's award for future medical expenses 
exceeding $100,000 to be deposited into an account over which 
the Fund has control, constitutional?  The parties argue the 
constitutionality of § 655.015 and the administrative rule 
implementing it, Wis. Admin. Code § Ins 17.26.  The parties have 
not adhered to the procedure set forth in Wis. Stat. § 227.40 
before challenging the constitutionality of the rule and have 
not considered whether the rule exceeds the authority delegated 
under § 655.015.  Accordingly, we remand this question to the 
circuit court for the parties to comply with § 227.40 and 
No. 
2003AP988   
 
6 
 
address the validity of the rule, as well as to be heard on the 
constitutionality of the statute and rule. 
¶13 Before continuing, it is important to highlight that 
this case is not about whether all caps, or even all caps on 
noneconomic damages, are constitutionally permissible.  The 
question before this court is a narrow one: Is the $350,000 cap 
(adjusted for inflation and hereinafter referred to as the 
$350,000 cap) on noneconomic damages in medical malpractice 
cases set forth in Wis. Stat. §§ 655.017 and 893.55(4)(d) 
constitutional? 
¶14 Medical malpractice litigation is a highly charged 
area of the law with ramifications not only for the injured 
party and the health care provider involved, but for all victims 
of medical malpractice, all health care providers, and the 
public.  After a patient is injured, sometimes severely and 
permanently, a medical malpractice lawsuit pits the unfortunate 
patient and the patient's family against the health care 
provider in whom the patient and family had previously placed 
their trust.  Physicians have contended that since the early- to 
mid-Nineteenth Century there has been a medical malpractice 
No. 
2003AP988   
 
7 
 
crisis pitting physicians against injured patients and their 
attorneys.9   
¶15 Emotion is not the only force at work in medical 
malpractice actions.  Money is at stake for everyone involved, 
including the public.  In the case of medical malpractice, 
interest groups representing every aspect of the delivery of 
health care are heavily involved in lobbying the legislature.  A 
sampling of the interest groups includes hospital associations, 
insurance companies, doctor and nurse associations, patient 
advocates, 
and 
lawyer 
associations. 
 
Despite 
these 
circumstances, the task of the court in a medical malpractice 
action is the same as in any other case:  to conduct a fair and 
neutral evaluation of the merits of the parties' arguments in 
light of the state's laws and constitution. 
¶16 Both in his briefs and at oral argument, Matthew 
Ferdon asks this court to strike down all statutory caps on 
noneconomic damages in medical malpractice actions under chapter 
655.  This court has not held that statutory limitations on 
damages are per se unconstitutional.10  Indeed, this court has 
                                                 
9 See generally Catherine T. Struve, Doctors, The Adversary 
System, and Procedural Reform in Medical Liability Litigation, 
72 
Fordham 
L. 
Rev. 
943, 
952 
(2004) 
("'[T]he 
physician 
consequently practices his art in chains, being perpetually 
exposed to the risk of a suit which may ruin his reputation as 
well as his fortune." (quoting John Ordronaux, The Jurisprudence 
of Medicine, in its Relations to the Law of Contracts, Torts, 
and Evidence, with a Supplement on the Liabilities of Vendors of 
Drugs 58 (1869)). 
10 Maurin v. Hall, 2004 WI 100, ¶208, 274 Wis. 2d 28, 682 
N.W.2d 866 (Abrahamson, C.J., and Crooks, J., concurring). 
No. 
2003AP988   
 
8 
 
recently upheld the cap on noneconomic damages for wrongful 
death medical malpractice actions.11  Just because caps on 
noneconomic damages are not unconstitutional per se does not 
mean that a particular cap is constitutional. 
¶17 Courts across the country are divided about whether 
caps on noneconomic damages are constitutional.  Even in state 
courts in which caps have been declared constitutional, there is 
invariably one or more strong dissents.12 
                                                                                                                                                             
This court has upheld limitations on damages in tort suits 
against governmental entities.  See Sambs v. City of Brookfield, 
97 Wis. 2d 356, 293 N.W.2d 504 (1980), cert. denied, 449 U.S. 
1035 (1980); Stanhope v. Brown County, 90 Wis. 2d 823, 280 
N.W.2d 711 (1979). 
11 Maurin, 274 Wis. 2d 28, ¶116. 
12 Some state courts have reached the conclusion that caps 
are unconstitutional.  See, e.g., Arneson v. Olson, 270 N.W.2d 
125, (N.D. 1978) (holding a statutory cap of $300,000 on all 
medical malpractice damages as a violation of equal protection); 
Moore v. Mobile Infirmary Ass'n, 592 So. 2d 156, 165-71 (Ala. 
1992) (holding cap on noneconomic damages in medical malpractice 
action violated the equal protection and right to jury trial 
guarantees of the Alabama Constitution); Brannigan v. Usitalo, 
587 A.2d 1232, 1234-36 (N.H. 1991), aff'g Carson v. Maurer, 424 
A.2d 825 (N.H. 1980) (holding a noneconomic damages cap in 
medical malpractice actions unconstitutional as a violation of 
the equal protection clause of the New Hampshire Constitution).   
 
No. 
2003AP988   
 
9 
 
¶18 The roadmap to this opinion is as follows: 
 
                                                                                                                                                             
Other states have found caps on noneconomic damages 
constitutional, oftentimes over strong dissents.  See, e.g., 
Judd v. Drezga, 103 P.3d 135, 141 (Utah 2004) (examining 
articles and studies and determining that the cap was reasonably 
related to making medical malpractice and health insurance rates 
affordable and that noneconomic damage caps did help achieve 
that goal, even if only in small part), but see Judd, 103 P.3d 
at 145 (Durham, C.J., dissenting); Zdrojewski v. Murphy, 657 
N.W.2d 721, 737-38 (Mich. Ct. App. 2003) (cap on noneconomic 
damages upheld against, among other challenges, an equal 
protection challenge), but see Zdrojewski, 657 N.W.2d at 739 
(Fitzgerald, P.J., dissenting), and Wiley v. Henry Ford Cottage 
Hosp., 668 N.W.2d 402, 416 (Mich. Ct. App. 2003) (holding that 
Zdrojewski's decision regarding the constitutionality of the 
caps was incorrect and should be overruled but that the court 
was bound to follow Zdrojewski's precedent); Univ. of Miami v. 
Echarte, 
618 
So. 
2d 
189, 
191 
(Fla. 
1993) 
(upholding 
constitutionality 
of 
noneconomic 
damages 
cap 
in 
medical 
malpractice actions), but see Echarte, 618 So. 2d at 198 
(Barkett, C.J., dissenting); Fein v. Permanente Med. Group, 695 
P.2d 665, 684 (Cal. 1985) (upholding cap on noneconomic damages 
cap in medical malpractice actions against due process and equal 
protection challenges), but see Fein, 695 P.2d at 687 (Bird, 
C.J., dissenting); Murphy v. Edmonds, 601 A.2d 102, 114-16 (Md. 
1992) (upholding Maryland's $350,000 noneconomic damage cap on 
personal injury awards against equal protection challenge), but 
see Murphy, 601 A.2d at 120 (Chasanow, J., dissenting).  
The Alaska Supreme Court divided 2-2 in Evans ex rel. Kutch 
v. Alaska, 56 P.3d 1046 (Alaska 2002), with two justices finding 
the noneconomic damage cap on all tort claims constitutional and 
two finding the caps unconstitutional. 
For discussions of state court rulings on caps, see Kevin 
J. Gfell, Note, The Constitutional and Economic Implications of 
a National Cap on Non-Economic Damages in Medical Malpractice 
Actions, 37 Ind. L. Rev. 773, 810-14 (2004); Carol A. Crocca, 
Annotation, Validity, Construction, and Application of State 
Statutory Provisions Limiting Amount of Recovery in Medical 
Malpractice Claims, 26 A.L.R. 5th 245 (1995). 
 
No. 
2003AP988   
 
10 
 
I. 
The facts (¶19 to ¶23) 
II. The medical malpractice statutes (¶24 to ¶28) 
III. Stare Decisis (¶29 to ¶56) 
IV. Equal Protection 
A. The level of scrutiny (¶59 to ¶80) 
B. The classifications (¶81 to ¶84) 
C. The legislative objectives (¶85 to ¶96) 
D. The rational basis (¶97 to ¶176) 
V. 
Other Statutes (¶177 to ¶183) 
VI. Conclusion (¶184 to ¶188) 
I. FACTS 
¶19 According to evidence produced at trial that the jury 
apparently accepted, as the doctor was delivering Matthew 
Ferdon, the doctor pulled on Matthew Ferdon's head.  The manner 
in which the doctor pulled caused an injury called obstetric 
brachial plexus palsy.  As a result of this injury, Matthew 
Ferdon's right arm is partially paralyzed and deformed.  Matthew 
Ferdon underwent surgeries and occupational therapy; as a result 
of the injury, more surgery and more therapy will be required.  
Matthew Ferdon's right arm will never function normally. 
¶20 Through his guardian ad litem, Vincent Petrucelli, 
Matthew Ferdon brought negligence claims against the doctor and 
the hospital.  The Fund, as required, was named as a defendant.13  
                                                 
13 State ex rel. Strykowski v. Wilkie, 81 Wis. 2d 491, 500, 
261 N.W.2d 434 (1978) ("Malpractice claimants seeking damages in 
excess of $200,000 must name the fund as a defendant, and the 
fund may appear and defend against the action."). 
No. 
2003AP988   
 
11 
 
Matthew Ferdon's parents, Cynthia and Dennis Ferdon, also 
brought a negligence claim, seeking to recover for loss of 
society and companionship.  A jury found the delivery doctor 
negligent for the injuries Matthew Ferdon sustained during the 
birth.   
¶21 The jury awarded the following damages to Matthew 
Ferdon: (1) Future medical and hospital expenses: $403,000; and 
(2) Past and future personal injuries (noneconomic damages): 
$700,000.  The jury made no award to Matthew Ferdon for loss of 
future earning capacity.  The jury awarded $87,600 to Cynthia 
and Dennis Ferdon as compensation for the personal care they 
will render for Matthew until the age of 18.   
¶22 After the verdict, the Fund moved the circuit court to 
reduce the $700,000 personal injury award to $410,322, the 
amount 
of 
the 
$350,000 
cap 
(adjusted 
for 
inflation) 
on 
noneconomic damages recoverable in a medical malpractice action 
under Wis. Stat. §§ 655.017 and 893.55(4)(d).  Further, the Fund 
moved to have the award for future medical and hospital expenses 
exceeding $100,000 placed under the Fund's control pursuant to 
Wis. Stat. § 655.015.   
¶23 The circuit court granted the Fund's motions, reducing 
the noneconomic damage award to the statutorily limited amount 
of $410,322 and ordering that $168,667.67 of the future medical 
No. 
2003AP988   
 
12 
 
and hospital expenses be paid into the reimbursement fund.14  
Matthew Ferdon appealed; the court of appeals summarily affirmed 
the circuit court based on its reading of State ex rel. 
Strykowski v. Wilkie15 and Guzman v. St. Francis Hospital, Inc..16 
                                                 
14 The amount of $168,667.67 reflects the portion of the 
award over $100,000 that is left after attorney fees are taken 
out of the jury's award for future medical expenses.  The 
overall award of $403,000 is the amount the jury felt was 
necessary to pay Matthew Ferdon's future medical expenses, 
reduced to present value.  The jury was asked to determine the 
present value of future medical expenses as required by Wis. 
Stat. § 893.55(4)(e).  Awards are reduced to their present value 
because a lump sum received today may be worth more than the 
same amount spread out over a period of years.  Section 
893.55(4)(e) provides: 
Economic damages recovered under ch. 655 for bodily 
injury or death, including any action or proceeding 
based on contribution or indemnification, shall be 
determined for the period during which the damages are 
expected to accrue, taking into account the estimated 
life expectancy of the person, then reduced to present 
value, taking into account the effects of inflation. 
The jury was informed that Matthew Ferdon was six years 
old, that he had a life expectancy of 69 years, and that the 
award should take into account economic conditions and the 
effect of inflation.  With respect to present value, the jury 
was instructed that their award should be reduced to present 
value "because a sum received today can be invested and earn 
money at current interest rates." 
From the $403,000 award for future medical expenses, it 
appears that the amount of $134,333.33 (amounting to one-third) 
was earmarked as "an amount sufficient to pay the cost of 
collection, including attorney fees reduced to present value" as 
required by § 655.015, leaving a balance of $268,666.67.  
Section 655.015 requires that of the $268,666.67, $100,000 is to 
go to Matthew Ferdon, with the remainder deposited into an 
account with the Fund for payment of future medical expenses 
consistent with § 655.015 and Wis. Admin. Code § Ins 17.26. 
15 State ex rel. Strykowski v. Wilkie, 81 Wis. 2d 491, 261 
N.W.2d 434 (1978). 
No. 
2003AP988   
 
13 
 
II. MEDICAL MALPRACTICE STATUTES 
¶24 In Wisconsin, a claim for injury resulting from 
medical malpractice by a health care provider is subject to the 
provisions of chapter 655.17  Chapter 655 provides the exclusive 
procedures for the "prosecution of malpractice claims against a 
health care provider."18  Among the damages available to a 
claimant 
are 
noneconomic 
damages, 
including 
damages 
to 
compensate for pain and suffering, mental distress, loss of 
enjoyment 
of 
normal 
activity, 
and 
loss 
of 
society 
and 
companionship.19      
¶25 The Fund was created to pay medical malpractice claims 
that exceed primary insurance thresholds established by statute.  
                                                                                                                                                             
16 Guzman v. St. Francis Hosp., Inc., 2001 WI App 21, 240 
Wis. 2d 559, 623 N.W.2d 776. 
17 Wis. Stat. § 655.007 ("On and after July 24, 1975, any 
patient or the patient's representative having a claim or any 
spouse, parent, minor sibling or child of the patient having a 
derivative claim for injury or death on account of malpractice 
is subject to this chapter.").  See Strykowski v. Wilkie, 81 
Wis. 2d 491, 499, 261 N.W.2d 434 (1978). 
18 Maurin, 
274 
Wis. 
2d 
28, 
¶50 
(internal 
quotations 
omitted). 
19 "Noneconomic" 
damages 
are 
defined 
in 
Wis. 
Stat. 
§ 893.55(4)(a).  That subsection reads: 
(4)(a) 
In this subsection, "noneconomic damages" 
means moneys intended to compensate for pain and 
suffering; humiliation; embarrassment; worry; mental 
distress; noneconomic effects of disability including 
loss of enjoyment of the normal activities, benefits 
and pleasures of life and loss of mental or physical 
health, well-being or 
bodily 
functions; 
loss of 
consortium, society and companionship; or loss of love 
and affection. 
No. 
2003AP988   
 
14 
 
The 
primary 
malpractice 
coverage 
is 
$1,000,000 
for 
each 
occurrence and $3,000,000 per policy year.20  Health care 
providers must participate in the Fund.  Although noneconomic 
damages are capped, the Fund provides unlimited liability 
coverage for economic damages exceeding the primary limits.21 
¶26 Should a claimant recover noneconomic damages as a 
result of a medical malpractice injury, those damages are 
statutorily capped pursuant to Wis. Stat. §§ 655.017 and 
893.55(4) at $350,000, a sum to be adjusted annually to reflect 
inflation.   
¶27 Section 655.017 reads as follows: 
Limitation on noneconomic damages.  The amount of 
noneconomic damages recoverable by a claimant or 
plaintiff under this chapter for acts or omissions of 
a health care provider if the act or omission occurs 
on or after May 25, 1995, and for acts or omissions of 
an employee of a health care provider, acting within 
the scope of his or her employment and providing 
health care services, for acts or omissions occurring 
on or after May 25, 1995, is subject to the limits 
under s. 893.55(4)(d) and (f).22 
                                                 
20 Wis. Stat. § 655.23(4)(b)(2). 
21 2003-2004 Joint Legislative Audit Committee, An Audit, 
Injured Patients and Families Compensation Fund (Office of the 
Commissioner of Insurance) (Oct. 2004) at 3, 15. 
22 Wisconsin Stat. § 893.55(4)(f) deals with wrongful death 
actions.  This subsection reads as follows: 
(f) Notwithstanding the limits on noneconomic damages 
under this subsection, damages recoverable against 
health care providers and an employee of a health care 
provider, acting within the scope of his or her 
employment and providing health care services, for 
wrongful death are subject to the limit under s. 
895.04(4).  If damages in excess of the limit under s. 
No. 
2003AP988   
 
15 
 
¶28 The financial limits to which § 655.017 refers are 
contained in Wis. Stat. § 893.55(4)(d), which reads as follows: 
(d) The limit on total noneconomic damages for each 
occurrence under par. (b) on or after May 25, 1995, 
shall be $350,000 and shall be adjusted by the 
director of state courts to reflect changes in the 
consumer price index for all urban consumers, U.S. 
city average, as determined by the U.S. department of 
labor, 
at 
least 
annually 
thereafter, 
with 
the 
adjustment limit to apply to awards subsequent to such 
adjustments. 
The parties do not dispute that in the instant case the 
inflation-adjusted cap authorized by Wis. Stat. § 893.55(4)(d) 
was $410,322. 
III. STARE DECISIS 
¶29 The Fund's first assertion is that, under the doctrine 
of stare decisis, prior cases of both this court and the court 
of appeals bind this court in the present case. 
¶30 The doctrine of stare decisis, or "stand by things 
decided,"23 normally compels a court to follow its prior 
decisions.  "Fidelity to precedent ensures that existing law 
will not be abandoned lightly."24   We have stated that stare 
                                                                                                                                                             
895.04(4) 
are 
found, 
the 
court 
shall 
make 
any 
reduction required under s. 895.045 and shall award 
the lesser of the reduced amount or the limit under s. 
895.04(4). 
23 Mackenzie v. Miller Brewing Co., 2001 WI 23, ¶16 n.13, 
241 Wis. 2d 700, 623 N.W.2d 739. 
24 Schultz v. Natwick, 2002 WI 125, ¶37, 257 Wis. 2d 19, 653 
N.W.2d 266. 
No. 
2003AP988   
 
16 
 
decisis is not mechanical in application, nor is it a rule to be 
inexorably followed.25   
¶31 The doctrine of stare decisis is inapplicable here.  
Although Wisconsin appellate decisions have treaded close to the 
constitutionality of the cap on recovery of noneconomic damages 
in medical malpractice cases, none has reached the issue central 
to the instant case.  Nevertheless, the prior cases, including 
equal protection challenges to various provisions of chapter 
655, inform our decision. 
¶32 We begin with Strykowski, the earliest case from this 
court addressing a challenge to chapter 655.26  Soon after 
chapter 655 was enacted, a group of petitioners challenged 
chapter 655 on several grounds, including equal protection.  The 
petitioners challenged a sub-classification that made a formal 
review panel available at the request of either party to a 
medical malpractice action if the claim exceeded $10,000, but 
made a review panel available for a claim under $10,000 only 
upon the stipulation of both parties.27  This court reasoned that 
the legislature could conclude that because claims over $10,000 
may be more complex, a formal review panel may be a more 
appropriate initial forum.  This court was careful to recognize 
that the 1975 legislative findings28 that medical malpractice 
                                                 
25 Johnson Controls, Inc. v. Employers Ins. of Wausau, 2003 
WI 108, ¶¶96-97, 264 Wis. 2d 60, 665 N.W.2d 257. 
26 Strykowski, 81 Wis. 2d at 498-99. 
27 Strykowski, 81 Wis. 2d at 510. 
28 § 1, ch. 37, Laws of 1975. 
No. 
2003AP988   
 
17 
 
raised special problems different from those in other tort 
actions, "while not binding on the court, carr[ied] great 
weight."29   
¶33 Strykowski addressed a different aspect of chapter 655 
than that involved in the instant case.  Strykowski involved an 
equal protection challenge to the formal review panels.  This 
case concerns the $350,000 cap implemented in 1995, not the 
overall constitutionality of chapter 655.  Therefore, the equal 
protection 
challenge 
in 
Strykowski 
was 
to 
a 
different 
classification than that at issue in the instant case.  Thus, 
the discussion of equal protection in Strykowski is not helpful, 
much less controlling, in resolving the issue facing us in the 
present case.   
¶34 Although chapter 655 as enacted contained a cap on 
noneconomic damages, that cap did not go into effect until 1979 
and even then was a contingency.  The cap adopted in 1979 
provided that awards would be limited to $500,000 per incident 
if the Fund's assets fell below certain levels.30 Because the cap 
was not in effect at the time Strykowski was being decided and 
therefore had not affected the petitioners' recoveries, the 
court declined to address the constitutionality of the cap in 
the face of an equal protection challenge.31   
                                                 
29 Strykowski, 81 Wis. 2d at 508. 
30 Id. at 500. 
31 Id. at 511. 
No. 
2003AP988   
 
18 
 
¶35 Our recent decision in Maurin v. Hall, 2004 WI 100, 
274 Wis. 2d 28, 682 N.W.2d 866, similarly does not control the 
present case.  In Maurin, this court rejected an equal 
protection challenge to the noneconomic damages cap in wrongful 
death actions.32 
¶36 Maurin involved a challenge to the provisions of 
chapters 655 and 893 that are specifically concerned with 
wrongful 
death 
medical 
malpractice 
actions 
(Wis. 
Stat. 
§ 893.55(4)(f)).  This case, a common law medical malpractice 
case, raises different equal protection challenges.  Different 
legislative objectives are at play in a wrongful death action 
because the medical malpractice victim is dead.  As noted by the 
majority in Maurin, the noneconomic damages cap in wrongful 
death cases was "implemented to assuage fears 'that passion 
would run high where the wrongdoer causes death and that huge 
damage awards would be imposed on the wrongdoer.'"33  The 
heightened passion surrounding a dead medical malpractice victim 
is not at issue in this case.  Matthew Ferdon survived.  And 
while Matthew Ferdon's injuries are indeed tragic, they pale in 
comparison 
to 
five-year-old 
Shay 
Maurin's 
death 
and 
are 
therefore not as likely to arouse the same passion in a jury. 
¶37  This court turned away an equal protection challenge 
in Czapinski v. St. Francis Hospital, Inc.34 Like Maurin, 
                                                 
32 Maurin, 274 Wis. 2d 28, ¶¶105-09. 
33 Id., ¶106. 
34 Czapinski v. St. Francis Hosp., Inc., 2000 WI 80, ¶¶26-
32, 236 Wis. 2d 316, 613 N.W.2d 120. 
No. 
2003AP988   
 
19 
 
Czapinski dealt with caps on wrongful death medical malpractice 
actions.  The court held that in the context of wrongful death 
actions, "[section] 893.55(4)(f) does not violate the equal 
protection clause of the Wisconsin Constitution."35 
¶38 The 
petitioners 
in 
Czapinski 
challenged 
a 
classification not at issue in this case.  The classification 
challenged was the distinction between how adult claimants were 
treated and how minor claimants were treated for loss of society 
and companionship of a parent who died as a result of medical 
malpractice.36  Adult children were denied recovery; minor 
children were entitled to recovery.  
¶39 In discussing the classification the court explained 
that "the distinction between adult children and minor children 
could be the different degree of dependency which each would be 
presumed to have on their parents for their continued financial 
and emotional support."37  Notably, when "[f]aced with the need 
to draw the line on who can collect for loss of society and 
companionship, . . . the availability of claims . . . should be 
limited to those who would suffer most severely from the loss of 
an intimate family relationship; adult children cannot be 
included in this classification."38  
                                                 
35 Id., ¶2. 
36 Id., ¶30. 
37 Id., ¶31 (quoted source omitted). 
38 Id. 
No. 
2003AP988   
 
20 
 
¶40 The $350,000 cap on noneconomic damages at issue here 
has exactly the opposite effect as the classification in 
Czapinski.  The $350,000 cap limits the claims of those who can 
least afford it; that is, the claims of those, including 
children such as Matthew Ferdon, who have suffered the greatest 
injuries. 
¶41 A recent court of appeals decision, Guzman v. St. 
Francis Hospital, Inc., 2001 WI App 21, 240 Wis. 2d 559, 623 
N.W.2d 776, is not strong precedent.  While the issue is the 
same as the instant case, the court of appeals' opinion is 
neither controlling nor particularly compelling.   
¶42 In Guzman, the circuit court held that the $350,000 
cap on noneconomic damages was unconstitutional as violating 
both the Wisconsin constitutional right to trial by jury and the 
separation of powers doctrine.  We granted a petition to bypass 
the court of appeals.39    
¶43 The supreme court divided equally, 3-3, in Guzman, 
with Justice David Prosser not participating. The order to 
bypass was vacated40 because no majority of justices could agree 
on whether to affirm or reverse the circuit court order holding 
the statutory cap in Wis. Stat. §§ 655.017 and 893.55(4)(d) 
unconstitutional. The case returned to the court of appeals, 
which declared the cap constitutional. 
                                                 
39 Wis. Stat. § 809.60. 
40 Guzman v. St. Francis Hosp., Inc., 2000 WI 34, ¶3, 234 
Wis. 2d 170, 609 N.W.2d 166. 
No. 
2003AP988   
 
21 
 
¶44 Each of the three judges on the court of appeals panel 
authored a separate opinion.  Only one of the three court of 
appeals 
judges 
supported 
the 
constitutionality 
of 
the 
noneconomic damages cap. 
¶45 One judge, in the lead opinion, concluded that the cap 
on noneconomic damages in Wis. Stat. §§ 655.017 and 893.55(4)(d) 
was constitutional.  He declared that whether a health-care 
crisis justified the legislature's responses was an assessment 
to be made by the legislature, not the courts.41  He further 
concluded that the cap did not violate the right to a trial by 
jury (Wis. Const. art. I, § 5),42 the right to a remedy for 
wrongs (Wis. Const. art. I, § 9),43 substantive due process,44 and 
the doctrine of separation of powers.45  
¶46 The concurring judge "reluctantly" joined the majority 
opinion, 
concluding 
that 
"the 
statute 
barely 
passes 
constitutional muster" and that she could not overturn legal 
precedent that supports the legislature's action.46   
¶47 The dissenting judge would have struck down the cap as 
a violation of Article I, Section 5, the right to a jury trial.   
                                                 
41 Id., ¶5. 
42 Id., ¶¶7-12. 
43 Id., ¶18. 
44 Id., ¶¶22-25. 
45 Id., ¶¶13-17. 
46 Id., ¶26. 
No. 
2003AP988   
 
22 
 
¶48 None of the three opinions in Guzman, however, 
addresses whether the $350,000 cap on noneconomic damages 
violates the state constitutional equal protection guarantees.   
¶49 In their equal protection challenge, the Guzmans 
argued that the classifications created by the cap should be 
reviewed using strict scrutiny.  They did not address whether 
the cap survived review under the rational basis test.  The 
court of appeals' lead opinion ruled that the rational basis 
test was the appropriate level of review and concluded that 
"[t]he Guzmans' silence on the rational-basis test is a 
concession that the cap passes that test."47 
¶50 We do not agree with this reasoning.  "A party's 
concession of law does not bind the court."48  The lead opinion 
further stated that because the Guzmans did not argue that the 
caps lacked a rational basis, the judge would not address that 
issue.49  Thus the lead opinion, the only opinion to address 
equal protection directly, did not decide whether the cap passed 
the rational basis test.      
¶51 Guzman therefore provides no opinion on the equal 
protection 
challenge 
and 
accordingly 
has 
no 
precedential 
vitality as to equal protection.  Furthermore, with three 
separate 
opinions, 
only 
one 
of 
which 
supports 
the 
                                                 
47 Guzman v. St. Francis Hosp., Inc., 2001 WI App 21, ¶21, 
240 Wis. 2d 559, 623 N.W.2d 776. 
48 Bergmann v. McCaughtry, 211 Wis. 2d 1, 7, 564 N.W.2d 712 
(1997). 
49 Guzman, 240 Wis. 2d 559, ¶21. 
No. 
2003AP988   
 
23 
 
constitutionality of the cap, Guzman is not a strong precedent 
for any proposition. 
¶52 In Martin v. Richards,50 the court determined whether a 
retroactive application of the $1,000,000 cap on noneconomic 
damages in malpractice cases could violate due process; it did 
not directly determine the constitutionality of the noneconomic 
damages cap.51  
¶53 The court's discussion of the cap in Martin is 
relevant to the instant case.  The court concluded that 
retroactive application of the cap would have a negligible 
effect on the cost of health care in the state.52  The court 
observed that although the claim is that noneconomic damages 
caps were implemented to prevent increasing costs associated 
with 
medical 
malpractice 
actions, 
"in 
this 
court 
these 
assertions are supported by a paucity of evidence."53 
                                                 
50 Martin v. Richards, 192 Wis. 2d 156, 531 N.W.2d 70 
(1995). 
51 Id. at 212. 
Martin involved a substantive due process challenge to the 
retroactive application of a cap.  Equal protection analysis and 
substantive due process have much in common.  Under substantive 
due 
process 
analysis 
the 
statute 
must 
bear 
a 
rational 
relationship to a reasonable legislative goal.  Under equal 
protection analysis there must be a rational relationship 
between the disparity in treatment resulting under a statute and 
a legitimate governmental objective.  Estate of Makos v. Wis. 
Masons Health Care Fund, 211 Wis. 2d 41, 75, 564 N.W.2d 662 
(1997) (Bradley, J., dissenting) (citing State v. Post, 197 
Wis. 2d 279, 319, 541 N.W.2d 115 (1995)).   
52 Martin, 192 Wis. 2d at 203-04. 
53 Id. at 203. 
No. 
2003AP988   
 
24 
 
¶54 In Rineck v. Johnson,54 this court held that the then-
$1,000,000 cap on noneconomic damages in medical malpractice 
actions superseded the lower cap in the wrongful death statute 
where the death resulted from medical malpractice.55  This court 
did not address the constitutionality of the medical malpractice 
cap. 
¶55 In Jelinek v. St. Paul Fire & Casualty Insurance Co.,56 
this court held that after the expiration of the $1,000,000 cap 
in 1991, recovery of noneconomic damages in medical malpractice 
actions involving death was unlimited.57  This court did not 
determine the constitutionality of a cap. 
¶56 Each of these cases informs our examination in the 
instant case, but none is controlling.     
IV. EQUAL PROTECTION 
¶57 We next examine Matthew Ferdon's assertion that the 
cap on noneconomic damage awards violates the equal protection 
guarantees of the Wisconsin Constitution. 
¶58 The interpretation of the Wisconsin Constitution and a 
determination 
of 
the 
constitutionality 
of 
a 
statute 
are 
ordinarily 
questions 
of 
law 
that 
this 
court 
determines 
                                                 
54 Rineck v. Johnson, 155 Wis. 2d 659, 456 N.W.2d 336 
(1990), cert. denied, 498 U.S. 1068 (1991). 
55 Rineck, 155 Wis. 2d at 666-68. 
56 Jelinek v. St. Paul Fire & Cas. Ins. Co., 182 Wis. 2d 1, 
512 N.W.2d 764 (1994), superseded by statute as stated in 
Czapinski, 236 Wis. 2d 316. 
57 Jelinek, 182 Wis. 2d at 12. 
No. 
2003AP988   
 
25 
 
independently of the circuit court and court of appeals, but 
benefiting from their analyses.   
A. Level of Scrutiny 
¶59 In deciding Matthew Ferdon's challenge to the $350,000 
cap on noneconomic damages on equal protection grounds, our 
first task is to determine the appropriate level of judicial 
scrutiny to be applied in determining constitutionality. 
¶60 The parties disagree about which level of judicial 
scrutiny should apply in this case.  Matthew Ferdon invites this 
court to use the strict scrutiny standard in reviewing the 
statutory $350,000 cap.  He argues that the noneconomic damages 
cap implicates the fundamental right to a trial by jury and the 
right to a remedy protected by the state constitution.  The Fund 
argues that strict scrutiny is unwarranted and that the proper 
level of review is rational basis review.  
¶61 Strict scrutiny applies if a statute challenged on 
equal protection grounds "impermissibly interferes with the 
exercise of a fundamental right or operates to the peculiar 
disadvantage of a suspect class."58  If strict scrutiny were 
applied in the instant case, the Fund would have the burden of 
showing that the $350,000 cap on noneconomic damages caused by 
medical 
malpractice 
tortfeasors 
promotes 
a 
compelling 
governmental interest and that the $350,000 cap is the least 
restrictive means for doing so.  That is, the Fund would have to 
                                                 
58 State v. Annala, 168 Wis. 2d 453, 468, 484 N.W.2d 138 
(1992) (citing Mass. Bd. of Ret. v. Murgia, 427 U.S. 307, 312 
(1976)).  
No. 
2003AP988   
 
26 
 
show that the cap is precisely tailored to serve a compelling 
state interest. 
¶62 Courts apply strict scrutiny sparingly, although at 
least one state court has used the strict scrutiny level of 
review in medical malpractice cases.59 
¶63 Several state courts have applied an intermediate 
level of scrutiny to caps in medical malpractice cases.60  Under 
intermediate scrutiny, the classification "must serve important 
governmental objectives and must be substantially related to 
                                                 
59 See Kenyon v. Hammer, 688 P.2d 961, 973-74 (Ariz. 1984) 
(the right to a remedy was a matter of importance since the 
state's early days of statehood and therefore strict scrutiny 
was appropriate). 
60 See, e.g., Carson v. Mauer, 424 A.2d 825, 830-31 (N.H. 
1980) (holding that the right to a remedy is an "important 
substantive right" requiring an intermediate level of scrutiny); 
Arneson v. Olson, 270 N.W.2d 125, 132-33 (N.D. 1978) (applying a 
heightened level of scrutiny to statute capping economic and 
noneconomic damages  to require a "close correspondence between 
statutory 
classification 
and 
legislative goals"); 
Judd v. 
Drezga, 103 P.3d 135 (Utah 2004) (holding that a challenge under 
Utah's version of a right to a remedy clause of the Utah 
constitution warranted application of heightened scrutiny).  But 
see Murphy v. Edmonds, 601 A.2d 102 (Md. 1992) (rejecting 
plaintiff's contention that because the access to courts right 
was implicated, a heightened level of scrutiny was therefore 
warranted). 
No. 
2003AP988   
 
27 
 
achievement of those objectives."61  This court has applied an 
intermediate level of scrutiny on at least one prior occasion.62 
¶64 Neither party in the present case has argued that we 
should apply the intermediate level of review. 
¶65 We agree with the Fund that rational basis, not strict 
scrutiny, is the appropriate level of scrutiny in the present 
case.63  This court has stated that Wis. Stat. chapter 655 does 
not deny any fundamental right and does not involve a suspect 
classification.64  In the context of wrongful death medical 
malpractice actions, this court has previously held that 
"[c]apping noneconomic wrongful death damages does not violate 
any fundamental right . . . ."65  Similarly, in examining whether 
the appointment of six-member compensation panels effectively 
                                                 
61 Craig v. Boren, 429 U.S. 190, 197 (1976) (applying 
intermediate scrutiny to a gender-based classification). 
62 See 
Brandmiller 
v. 
Arreola, 
199 
Wis. 2d 528, 
544 
N.W.2d 894 (1996) (applying intermediate level of scrutiny to 
determine whether restrictions in ordinance on cruising in cars 
were 
narrowly 
tailored 
to 
serve 
significant 
government 
interests). 
63 Maurin, 274 Wis. 2d 28, ¶212 (Abrahamson, C.J., and 
Crooks, J., concurring) (constitutionality of cap on noneconomic 
damage award in wrongful death case). 
64 Czapinski, 
236 
Wis. 2d 316, 
¶28; 
Strykowski, 
81 
Wis. 2d 491, 507, 261 N.W.2d 434 (1978). 
65 Maurin, 274 Wis. 2d 28, ¶105; see also Czapinski, 236 
Wis. 2d 316, ¶26 ("Although § 893.55(4)(f) [covering wrongful 
death 
medical 
malpractice 
actions] 
creates 
separate 
classifications for . . . tort victims [based on their status as 
adults or children], these classifications do not violate equal 
protection."). 
No. 
2003AP988   
 
28 
 
denied suing patients access to the courts, thereby violating 
their rights to a jury trial as preserved in Article I, Section 
5 of the Wisconsin Constitution, this court held that chapter 
655 
did 
not 
involve 
fundamental 
rights 
or 
suspect 
classifications.66  As for Article I, Section 9, "[t]his court 
has never construed the right [to a remedy provision] to be 
fundamental."67 
¶66 This 
discussion 
is 
not 
meant 
to 
minimize 
the 
importance of the right to a jury and the right to a remedy; 
both are important rights.  Nevertheless, in the context of 
equal protection challenges to medical malpractice provisions, 
this court has not viewed these two constitutional guarantees as 
belonging to the class of rights warranting strict scrutiny.  
The rational basis level of scrutiny is therefore applied in the 
present case. 
¶67 A person challenging a statute on equal protection 
grounds under the rational basis level of scrutiny bears a heavy 
burden in 
overcoming the 
presumption 
of constitutionality 
afforded statutes.68  Statutes are afforded the presumption of 
constitutionality 
"[b]ecause 
statutes 
embody 
the 
economic, 
                                                 
66 Strykowski, 
81 
Wis. 2d 491, 
506-07, 
261 
N.W.2d 434 
(1978).   
67 Doering v. WEA Ins. Group, 193 Wis. 2d 118, 130, 532 
N.W.2d 432 (1995). 
68 Aicher ex rel. LaBarge v. Wis. Patients Comp. Fund, 2000 
WI 98, ¶¶18-19, 237 Wis. 2d 99, 613 N.W.2d 849. 
No. 
2003AP988   
 
29 
 
social, 
and 
political 
decisions 
entrusted 
to 
the 
legislature . . . ."69    
¶68 The longstanding rule set forth by this court is that 
"all legislative acts are presumed constitutional, that a heavy 
burden is placed on the party challenging constitutionality, and 
that if any doubt exists it must be resolved in favor of the 
constitutionality of a statute."70  A challenger must demonstrate 
that a statute is unconstitutional beyond a reasonable doubt.71 
¶69 Nevertheless, when a legislative act unreasonably 
invades rights guaranteed by the state constitution, a court has 
                                                 
69 Maurin, 274 Wis. 2d 28, ¶93.  See also Aicher, 237 
Wis. 2d 99, ¶20 ("[T]he judiciary is not positioned to make the 
economic, social, and political decisions that fall within the 
province of the legislature."); Sambs, 97 Wis. 2d at 377 
(legislature evaluates the risks and balances the competing 
interests of exposure to liability and the need to compensate 
individuals for injury). 
70 Sambs, 97 Wis. 2d at 370 (citing Stanhope, 90 Wis. 2d at 
837). 
71 Maurin, 274 Wis. 2d 28, ¶93; Sambs, 97 Wis. 2d at 370, 
(citing Stanhope, 90 Wis. 2d at 837). 
The constitutionality of a statute is an issue of law, not 
fact.  The "beyond the reasonable doubt burden of proof" 
language is, however, reminiscent of an evidentiary burden of 
proof in criminal cases.  The beyond a reasonable doubt burden 
of proof in a constitutional challenge case means that a court 
gives great deference to the legislature, and a court's degree 
of certainty about the unconstitutionality results from the 
persuasive force of legal argument.  See Davis v. Grover, 166 
Wis. 2d 501, 564 n. 13, 480 N.W.2d 460 (1992) (Abrahamson, J., 
dissenting); State ex rel. Hammermill Paper Co. v. La Plante, 58 
Wis. 2d 32, 46, 205 N.W.2d 784 (1973); Guzman, 240 Wis. 2d 559, 
¶4, n.3; United Air Lines, Inc. v. City of Denver, 973 P.2d 647, 
658 (Colo. Ct. App. 1998) (Briggs, J., concurring). 
No. 
2003AP988   
 
30 
 
not only the power but also the duty to strike down the act.  
Although we do not address Ferdon's constitutional challenges 
under Article I, Section 5 (right to a jury trial) and Section 9 
(right to a remedy), the $350,000 cap on noneconomic damages may 
implicate these constitutional rights.  In short, "neither our 
respect 
for 
the 
legislature 
nor 
the 
presumption 
of 
constitutionality allows for absolute judicial acquiescence to 
the legislature's statutory enactments."72  The court has 
emphasized that "[s]ince Marbury v. Madison, it has been 
recognized that it is peculiarly the province of the judiciary 
to interpret the constitution and say what the law is."73 
¶70 The decisions in this court, in other state courts, 
and in the United States Supreme Court have expressed judicial 
review on the basis of equal protection in a variety of 
iterations.74  Cases within a single jurisdiction have expressed 
divergent views on the clarity with which a legislative purpose 
must be stated and on the degree of deference afforded the 
legislature in suiting means to ends.75 
                                                 
72 Guzman, 240 Wis. 2d 559, ¶39. 
73 State ex rel. Wis. Senate v. Thompson, 144 Wis. 2d 429, 
436, 424 N.W.2d 385 (1988) (citation omitted). 
74 See County of Portage v. Steinpreis, 104 Wis. 2d 466, 487 
n.4, 312 N.W.2d 731 (1981) (Abrahamson, J., dissenting).  
75 Id. at 487 n.4 (Abrahamson, J., dissenting); Schweiker v. 
Wilson, 450 U.S. 221, 243 (1981) (Powell, J., dissenting). 
No. 
2003AP988   
 
31 
 
¶71 This court has often quoted the United States Supreme 
Court's articulation of the rational basis test set forth in 
McGowan v. Maryland76 as follows: 
[The Equal Protection Clause] permits the States a 
wide scope of discretion in enacting laws which affect 
some groups of citizens differently than others.  The 
constitutional safeguard is offended only if the 
classification rests on grounds wholly irrelevant to 
the achievement of the State's objective.  State 
legislatures are presumed to have acted within their 
constitutional 
power 
despite 
the 
fact 
that, 
in 
practice, their laws result in some inequality.  A 
statutory discrimination will not be set aside if any 
state of facts reasonably may be conceived to justify 
it.77 
¶72 The court has written that the rational basis standard 
in the equal protection context does not require that all 
individuals be treated identically, but any distinctions must be 
relevant 
to 
the 
purpose 
motivating 
the 
classification.78  
                                                 
76 McGowan v. Maryland, 366 U.S. 420 (1961). 
77 McGowan, 366 U.S. at 425-26.  This court and the United 
States have applied various formulations of the rational basis 
test, including some that have articulated a five-part standard.  
See, e.g., Omernik v. State, 64 Wis. 2d 6, 19, 218 N.W.2d 734 
(1974); Aicher, 237 Wis. 2d 99, ¶58.  The essential question 
posed by the five-part test is whether there are any real 
differences to distinguish the favored class from other classes.   
Kallas Millwork Corp. v. Square D Co., 66 Wis. 2d 382, 389, 225 
N.W.2d 454 (1975).  Other cases have articulated a more 
qualitative approach.  See, e.g., Doering, 193 Wis. 2d at 131-
32. 
78 Doering, 193 Wis. 2d at 131-32 (citing Szarzynski v. 
YMCA, Camp Minikani, 184 Wis. 2d 875, 886, 517 N.W.2d 135 
(1994)); see also Maurin, 274 Wis. 2d 28, ¶106; Sambs, 97 
Wis. 2d at 370-72; Stanhope, 90 Wis. 2d at 837-38. 
No. 
2003AP988   
 
32 
 
Similarly situated individuals should be treated similarly.79  In 
essence, the rational basis standard asks "whether there are any 
real differences to distinguish the favored class . . . from 
other classes . . . who are ignored by the statute . . . ."80   
¶73 A statute will be upheld against an equal protection 
challenge 
if 
a 
plausible 
policy 
reason 
exists 
for 
the 
classification and the classification is not arbitrary in 
relation to the legislative goal.81  A statute will be held 
unconstitutional if the statute is shown to be "patently 
arbitrary" with "no rational relationship to a legitimate 
government interest."82  The party challenging the classification 
has the burden of demonstrating that the classification is 
arbitrary and irrationally discriminatory.  
¶74 In evaluating whether a legislative classification 
rationally 
advances 
the 
legislative 
objective,83 
"we 
are 
obligated to locate or, in the alternative, construct a 
                                                 
79 Treiber v. Knoll, 135 Wis. 2d 58, 68, 398 N.W.2d 756 
(1987). 
80 Doering, 193 Wis. 2d at 131 n.11 (quoted source omitted). 
81 Maurin, 274 Wis. 2d 28, ¶106; Doering, 193 Wis. 2d at 131 
(citing Szarzynski v. YMCA, Camp Minikani, 184 Wis. 2d 875, 886, 
517 N.W.2d 135 (1994)); see also Sambs, 97 Wis. 2d at 370-72. 
82 Maurin, 274 Wis. 2d 28, ¶106 (citations omitted). 
83 Treiber v. Knoll, 135 Wis. 2d 58, 65, 398 N.W.2d 756 
(1987). 
No. 
2003AP988   
 
33 
 
rationale 
that 
might 
have 
influenced 
the 
legislative 
determination."84 
¶75 Once the court identifies a rational basis for a 
statute, the court must assume the legislature passed the act on 
that basis,85 and "[a]ll facts necessary to sustain the act must 
be taken as conclusively found by the legislature, if any such 
facts may be reasonably conceived in the mind of the court."86   
¶76 The 
rational 
basis 
test 
does 
not 
require 
the 
legislature to choose the best or wisest means to achieve its 
goals.87  Deference to the means chosen is due even if the court 
believes that the same goal could be achieved in a more 
effective manner.88 
¶77 Nevertheless, judicial deference to the legislature 
and the presumption of constitutionality of statutes do not 
require a court to acquiesce in the constitutionality of every 
statute.  A court need not, and should not, blindly accept the 
claims of the legislature.  For judicial review under rational 
basis to have any meaning, there must be a meaningful level of 
                                                 
84 Aicher, 237 Wis. 2d 99, ¶57.  See also Maurin, 274 
Wis. 2d 28, ¶212 (Abrahamson, C.J., and Crooks, J., concurring).  
See also Sambs, 97 Wis. 2d at 371; Stanhope, 90 Wis. 2d at 838. 
85 Aicher, 237 Wis. 2d 99, ¶57. 
86 Treiber v. Knoll, 135 Wis. 2d 58, 65, 398 N.W.2d 756 
(1987) (quoting State ex rel. Carnation Milk Prods. Co. v. 
Emery, 178 Wis. 147, 189 N.W. 564 (1922); State v. Interstate 
Blood Bank, Inc., 65 Wis. 2d 482, 489, 222 N.W.2d 912 (1974)). 
87 Stanhope, 90 Wis. 2d at 843. 
88 Aicher, 237 Wis. 2d 99, ¶66. 
No. 
2003AP988   
 
34 
 
scrutiny, a thoughtful examination of not only the legislative 
purpose, but also the relationship between the legislation and 
the purpose. The court must "probe beneath the claims of the 
government to determine if the constitutional 'requirement of 
some rationality in the nature of the class singled out' has 
been met."89 
¶78 The rational basis test is "not a toothless one."90  
"Rational basis with teeth," sometimes referred to as  "rational 
                                                 
89 Doering, 193 Wis. 2d at 132 (quoting James v. Strange, 
407 U.S. 128, 140 (1972)). 
90 Doering, 193 Wis. 2d at 132 ("the rational basis test is 
'not a toothless one'"), quoting Schweiker, 450 U.S. at 234 
(quoted with approval in Wis. Wine & Spirit Inst. v. Ley, 141 
Wis. 2d 958, 964, 416 N.W.2d 914 (Ct. App. 1987)).  See also 
Mathews v. Lucas, 427 U.S. 495, 510 (1976) (scrutiny is not 
toothless); State ex rel. Grand Bazaar Liquors, Inc. v. 
Milwaukee, 105 Wis. 2d 203, 209, 313 N.W.2d 805 (1982) (rational 
basis standard of review is not a toothless one); State ex rel. 
Watts v. Combined Cmty. Servs., 122 Wis. 2d 65, 81 n.8, 362 
N.W.2d 104 (1984) (citing Gerald Gunther, In Search of Evolving 
Doctrine on a Changing Court: A Model for a Newer Equal 
Protection, 86 Harv. L. Rev. 1, 22, 31 (1972), and referring to 
"a middle level tier of judicial scrutiny," which has been 
termed "'vigorous rational basis scrutiny'" or the traditional 
standard "'with new bite'"); County of Portage v. Steinpreis, 
104 Wis. 2d 466, 487, 312 N.W.2d 731 (1981) (Abrahamson, J., 
dissenting) (rational basis is not a toothless standard). 
No. 
2003AP988   
 
35 
 
basis with bite," focuses on the legislative means used to 
achieve the ends.91  This standard simply requires the court to 
conduct an inquiry to determine whether the legislation has more 
than a speculative tendency as the means for furthering a valid 
legislative 
purpose. 
 
"The 
State 
may 
not 
rely 
on 
a 
classification whose relationship to an asserted goal is so 
attenuated 
as 
to 
render 
the 
distinction 
arbitrary 
or 
irrational."92  At least one law student note, while observing 
that the U.S. Supreme Court had "employ[ed] searching scrutiny 
under the label of rational basis review,"93 nevertheless 
                                                                                                                                                             
Justice Thurgood Marshall 
(joined 
by 
Justice William 
Brennan and Justice Harry Blackmun) rejected a rigid approach to 
equal protection analysis and proposed using varying levels of 
scrutiny depending on the importance of the interests adversely 
affected and the invidiousness of the basis on which the 
classification is drawn.  Justice Marshall wrote for himself and 
the other two Justices that "[t]he Court's opinion [in Cleburne] 
approaches the task of principled equal protection in what I 
view as precisely the wrong way. . . . in focusing obsessively 
on the appropriate label to give its standard of review . . . ." 
City of Cleburne v. Cleburne Living Ctr., Inc., 473 U.S. 432, 
478 (1985) (Marshall, J., concurring in part and dissenting in 
part). 
91 Gerald Gunther, In Search of Evolving Doctrine on a 
Changing Court: A Model for a Newer Equal Protection, 86 Harv. 
L. Rev. 1, 18-19 (1972).  
92 See Cleburne, 473 U.S. at 446. 
93 For several of these cases, see, e.g., Lawrence v. Texas, 
539 U.S. 558, 580 (2003) (O'Connor, J., concurring); Romer v. 
Evans, 517 U.S. 620 (1996); Cleburne, 473 U.S. 432; Hooper v. 
Bernalillo County Assessor, 472 U.S. 612 (1985); Williams v. 
Vermont, 472 U.S. 14 (1985); Metro. Life Ins. Co. v. Ward, 470 
U.S. 869 (1985); Zobel v. Williams, 457 U.S. 55 (1982). 
No. 
2003AP988   
 
36 
 
criticized the U.S. Supreme Court and implored the use of 
intermediate scrutiny rather than rational basis with teeth.94 
¶79 Constitutional law scholar Professor Gerald Gunther 
wrote, however, as follows that rational basis with teeth "is 
not the same as "'intermediate scrutiny'": 
[Rational basis with teeth] does not take issue with 
the 
heightened 
scrutiny 
tiers 
of 
"strict" 
and 
"intermediate" 
review. 
 
Instead, 
it 
is 
solely 
addressed to the appropriate intensity of review to be 
exercised when the lowest tier, that of rationality 
review, 
is 
deemed 
appropriate. . . . What 
the 
[rational basis with teeth model] asks is that some 
teeth be put into that lowest level of scrutiny, that 
it be applied "with bite," focusing on means without 
second-guessing legislative ends.  (Evaluating the 
importance of the ends is characteristic of all higher 
levels of scrutiny.)  In short, [rational basis with 
teeth raises] slightly the lowest tier of review under 
the two- or three-tier models; but it does not seek to 
raise the "mere rationality" level appropriate for 
run-of-the-mill economic regulation cases all the way 
up to the level of "intermediate" or of "strict" 
scrutiny.95 
                                                 
94 Gayle Lynn Pettinga, Note, Rational Basis With Bite: 
Intermediate Scrutiny By Any Other Name, 62 Ind. L.J. 779, 802 
(1987). 
95 Gerald Gunther, Constitutional Law, 605 n.5 (11th ed. 
1985) 
(emphasis 
added). 
 
See 
Lawrence 
Tribe, 
American 
Constitutional Law, § 16-3, at 1445-46 (2d ed. 1988) (suggesting 
open use of rational basis with bite only when quasi-suspect 
classifications are at issue, but also noting that "[w]hile 
there may be grounds for the reluctance to proliferate new 
categories 
of 
classifications 
overtly 
triggering 
closer 
scrutiny, its covert use under the minimum rationality label 
presents dangers of its own."). 
No. 
2003AP988   
 
37 
 
¶80 Whether the level of scrutiny is called rational 
basis, rational basis with teeth, or meaningful rational basis, 
it is this standard we now apply in this case. 
B. The Classifications 
¶81 The task of drawing lines, that is the task of 
creating 
classifications, 
is 
a 
legislative 
one 
in 
which 
perfection "is neither possible nor necessary."96  The court's 
goal 
is 
to 
determine 
whether 
the 
classification 
scheme 
rationally advances the legislative objective.  In limiting 
noneconomic damages in medical malpractice actions, Wis. Stat. 
§§ 655.017 
and 
893.55(4)(d) 
together 
create 
a 
number 
of 
classifications 
and 
sub-classifications.97 
 
One 
main 
classification is relevant to the present case, and one sub-
classification is implicated: 
                                                 
96 Estate of Makos v. Wis. Masons Health Care Fund, 211 
Wis. 2d 41, 75, 564 N.W.2d 662 (1997) (Bradley, J., dissenting) 
(quoted with approval in Aicher, 237 Wis. 2d 99, ¶57). 
97 There are two large classifications of plaintiffs and 
defendants created by the statutes whom we do not address here.  
(1) Two classes of tort plaintiffs are created by the $350,000 
cap: those injured by the medical malpractice of health care 
providers covered by chapter 655 and therefore subject to the 
cap on noneconomic damages, and those injured by tortious 
conduct of non-health care providers who are not subject to the 
$350,000 cap on noneconomic damages.  The court has held that 
medical malpractice actions are substantially distinct from 
other tort actions.  Czapinski, 236 Wis. 2d 316, ¶30. (2) Two 
classes of tortfeasors are created by the $350,000 cap: health 
care tortfeasors and non-health care tortfeasors.  Health care 
tortfeasors whose conduct producing the most harm (in excess of 
the $350,000 cap) are partially shielded by the $350,000 cap on 
noneconomic 
damage 
awards, 
as 
compared 
with 
health 
care 
tortfeasors whose conduct produces less harm. 
No. 
2003AP988   
 
38 
 
¶82 The main classification is the distinction between 
medical 
malpractice 
victims 
who 
suffer 
over 
$350,000 
in 
noneconomic damages, and medical malpractice victims who suffer 
less than $350,000 in noneconomic damages.  That is, the cap 
divides the universe of injured medical malpractice victims into 
a class of severely injured victims and less severely injured 
victims.  Severely injured victims with more than $350,000 in 
noneconomic damages receive only part of their damages; less 
severely injured victims with $350,000 or less in noneconomic 
damages receive their full damages.  In other words, the 
statutory cap creates a class of fully compensated victims and 
partially compensated victims.  Thus, the cap's greatest impact 
falls on the most severely injured victims.98 
¶83 A main sub-classification is created as part of the 
$350,000 cap on noneconomic damages.  A single cap applies to 
all victims of a medical malpractice occurrence regardless of 
the number of victims/claimants.  Because the total noneconomic 
damages recoverable for bodily injury or death may not exceed 
the $350,000 limit for each occurrence, the total award for a 
patient's claim for noneconomic damages (such as pain, suffering 
and disability) and the claims of the patient's spouse, minor 
children, or parents for loss of society and companionship 
cannot exceed $350,000.99  Thus, classes of victims are created 
                                                 
98 Wisconsin Patients Compensation Fund Report to Joint 
Legislative Audit Committee (prepared by the Special Committee 
of the Board of Governors), Executive Summary, at 14 (June 13, 
1994). 
99 See Wis. Stat. §§ 655.007, 893.55(5). 
No. 
2003AP988   
 
39 
 
depending on whether the patient has a spouse, minor children, 
or a parent.  An injured patient who is single may recover the 
entire $350,000, while a married injured patient shares the cap 
with his or her spouse; a non-married injured patient with 
children shares the $350,000 with the children; a married 
injured patient with children shares the cap with the spouse and 
children.  
¶84 With these classifications in mind, we turn to the 
legislature's 
objectives 
for 
enacting 
a 
$350,000 
cap 
on 
noneconomic damages in medical malpractice actions. 
C. Legislative Objectives. 
¶85 Identifying the legislative objectives will allow us 
to determine whether the legislatively created classifications 
are rationally related to achieving appropriate legislative 
objectives.100 
¶86 Although the legislature did not explicitly state its 
objectives as such, it made a number of findings when it enacted 
chapter 655.101  These findings give a strong indication of the 
                                                 
100 Doering, 193 Wis. 2d at 137-38. 
101 Maurin, 274 Wis. 2d 28, Appendix.  Section 1, ch. 37, 
Laws of 1975 reads: 
Section 1.  Legislative findings. (1) The legislature 
finds that: 
(a) The number of suits and claims for damages arising 
from 
professional 
patient 
care 
has 
increased 
tremendously in the past several years and the size of 
judgments and settlements in connection therewith has 
increased even more substantially; 
No. 
2003AP988   
 
40 
 
                                                                                                                                                             
(b) The effect of such judgments and settlements, 
based frequently on newly emerging legal precedents, 
has been to cause the insurance industry to uniformly 
and substantially increase the cost and limit the 
availability 
of 
professional 
liability 
insurance 
coverage; 
(c) These increased insurance costs are being passed 
on to patients in the form of higher charges for 
health care services and facilities; 
(d) The increased costs of providing health care 
services, the increased incidents of claims and suits 
against health care providers and the size of such 
claims 
and 
judgments 
has 
caused 
many 
liability 
insurance companies to withdraw completely from the 
insuring of health care providers; 
(e) The rising number of suits and claims is forcing 
both 
individual 
and 
institutional 
health 
care 
providers to practice defensively, to the detriment of 
the health care provider and the patient; 
(f) As a result of the current impact of such suits 
and claims, health care providers are often required, 
for 
their 
own 
protection, 
to 
employ 
extensive 
diagnostic procedures for their patients, thereby 
increasing the cost of patient care; 
(g) As another effect of the increase of such suits 
and 
claims 
and 
the 
costs 
thereof, 
health 
care 
providers are reluctant to and may decline to provide 
certain health care services which might be helpful, 
but in themselves entail some risk of patient injury; 
(h) The cost and the difficulty in obtaining insurance 
for 
health 
care 
providers 
discourages 
and 
has 
discouraged young physicians from entering into the 
practice of medicine in this state; 
(i) Inability to obtain, and the high cost of 
obtaining, such insurance has affected and is likely 
to further affect medical and 
hospital 
services 
available in this state to the detriment of patients, 
the public and health care providers; 
No. 
2003AP988   
 
41 
 
legislature's objectives.  The findings can be summarized as 
follows: 
1. Judgments and settlements have increased, thereby 
increasing the cost and limiting the availability of 
professional liability insurance coverage;102  
2. The increased costs of medical malpractice premiums 
are passed on to the patients in the form of higher charges 
for health care;103 
3. Individual and institutional health care providers 
are being forced to practice defensively, to the detriment 
of the health care provider and patient, and may decline to 
provide certain services that might be helpful but may 
entail some risk to the patient;104 
4. The cost and difficulty of obtaining medical 
malpractice insurance discourages young physicians from 
entering into the practice of medicine in this state and 
may encourage health care providers to curtail or cease 
                                                                                                                                                             
(j) Some health care providers have curtailed or 
ceased, or may further curtail or cease, their 
practices because of the nonavailability or high cost 
of professional liability insurance; and 
(k) It therefor [sic] appears that the entire effect 
of such suits and claims is working to the detriment 
of the health care provider, the patient and the 
public in general. 
102 § 1 (1)(a), (b), ch.37, Laws of 1975. 
103 § 1 (1)(c), ch. 37, Laws of 1975. 
104 § 1 (1)(e), (f), (g), ch. 37, Laws of 1975. 
No. 
2003AP988   
 
42 
 
their practices in Wisconsin.105  Malpractice insurers may 
leave the marketplace, making it harder for health care 
providers to obtain medical malpractice insurance.106 
5. "[T]he entire effect of such suits and claims is 
working to the detriment of the health care provider, the 
patient and the public in general."107   
¶87 In 
sum, 
the 
legislature 
found 
that 
malpractice 
lawsuits raise the cost of medical malpractice insurance for 
providers.  According to the legislature, higher medical 
malpractice insurance costs, in turn, harm the public because 
they result in increased medical costs for the public and 
because health care providers might leave Wisconsin.  The 
legislature 
also 
found 
that 
health 
care 
providers 
were 
practicing defensive medicine because of the rising number of 
claims and that they might refuse to enter the Wisconsin health 
care market.  These legislative findings are not binding on the 
court but carry great weight.108    
¶88 From the findings set forth when chapter 655 was 
enacted in 1975, we can deduce a primary, overall legislative 
objective and five interconnected legislative objectives that 
led to adoption of the $350,000 cap on noneconomic damage 
awards. 
                                                 
105 § 1 (1)(h), (i), (j), ch. 37, Laws of 1975. 
106 § 1 (d), ch. 37, Laws of 1975. 
107 § 1 (1)(k), ch. 37, Laws of 1975. 
108 Strykowski, 81 Wis. 2d at 508. 
No. 
2003AP988   
 
43 
 
¶89 The primary, overall legislative objective is to 
ensure the quality of health care for the people of Wisconsin.109 
The legislature obviously did not intend to reach this objective 
by shielding negligent health care providers from responsibility 
for their negligent actions.   After all, "[i]t is a major 
contradiction to legislate for quality health care on one hand, 
while on the other hand, in the same statute, to reward 
negligent health care providers."110  A cap on noneconomic 
                                                 
109 Id. at 509. 
110 Farley v. Engelken, 740 P.2d 1058, 1067 (Kan. 1987). 
The General Accounting Office concluded that one of the 
surest ways to "deal with the problem of increasing insurance 
costs" is to eliminate the conditions that result in acts 
amounting to medical malpractice.  U.S. General Accounting 
Office, Medical Malpractice: A Framework for Action, GAO/HRD-87-
73, at 3, 12-19 (May 1987). 
Efforts 
to 
accomplish 
this 
may 
include 
(1) 
disciplining 
or 
removing 
from 
practice 
those 
physicians not providing an acceptable quality of 
care; (2) protecting patients from physicians who lose 
their licenses in one state but have them in another; 
and (3) developing and expanding risk management 
programs to educate providers concerning better ways 
of delivering an acceptable quality of health care, 
minimizing 
the 
possibility 
of 
future 
malpractice 
suits.   
Id. at 12. 
No. 
2003AP988   
 
44 
 
damages diminishes tort liability for health care providers and 
diminishes the deterrent effect of tort law.111 
¶90 The all-encompassing legislative objective is reached, 
according to the legislative reasoning, by accomplishing the 
following objectives. 
¶91 Legislative Objective #1: Ensure adequate compensation 
for victims of medical malpractice with meritorious injury 
claims.  The legislature retained the tort system as a means of 
identifying health care providers who are practicing below the 
required due care standards and as a means of deterring them and 
other health care providers from negligent practices.  The 
legislature obviously considers noneconomic injuries to be real 
injuries 
for 
which 
plaintiffs 
should 
be 
compensated 
in 
appropriate cases.   
¶92 Legislative Objective #2: Enable health care insurers 
to charge lower malpractice insurance premiums by reducing the 
size of medical malpractice awards. 
¶93 Legislative Objective #3: Keep the Fund's annual 
assessment to health care providers at a low rate and protect 
                                                 
111 Prosser & Keeton on the Law of Torts § 4, at 25 (W. Page 
Keeton ed., 5th ed. 1984) ("The 'prophylactic' factor of 
preventing future harm has been quite important in the field of 
torts."); Kenneth E. Thorpe, The Medical Malpractice 'Crisis': 
Recent Trends and the Impact of State Tort Reforms, Health 
Affairs 
W4-20, 
W4-25, 
W4-24 
(Jan. 
21, 
2004), 
at 
http://content.healthaffairs.org/cgi/reprint/hlthaff.w4.20v1 
("[D]eterring substandard medical care is a major rationale for 
using a tort-liability system for medical malpractice."  Also, 
"[r]ising claims costs may reflect a rise in underlying 
negligence."). 
No. 
2003AP988   
 
45 
 
the Fund's financial status.  The fewer and smaller the claims 
the Fund must pay, the more likely the Fund will have a sound 
cash flow, and the more likely the Fund will be able to lower 
its annual assessments to health care providers.  With lower 
insurance premiums charged by the primary insurers and lower 
annual assessments by the Fund, health care will be more 
affordable to Wisconsin's citizens. 
¶94 Legislative Objective #4: Reduce overall health care 
costs (by lowering malpractice insurance premiums) for consumers 
of health care. 
¶95 Legislative 
Objective 
#5: 
Encourage 
health 
care 
providers to practice in Wisconsin.  Health care providers 
ensure quality health care for the people of Wisconsin.  Lower 
malpractice 
insurance 
premiums 
will 
prevent 
health 
care 
providers from leaving Wisconsin.  Related are the goals of 
avoiding the practice of defensive medicine and retaining 
malpractice insurance vendors in Wisconsin.    
¶96 In sum, chapter 655 was designed by the legislature to 
help limit the increasing cost of health care and possible 
"diminishing . . . availability of health care in Wisconsin."112  
The legislature's immediate objective in enacting the $350,000 
cap was apparently to ensure the availability of sufficient 
liability insurance at a reasonable cost to cover claims of 
patients.  "Taming the costs of medical malpractice and ensuring 
                                                 
112 Patients Comp. Fund v. Lutheran Hosp.-La Crosse, Inc., 
216 Wis. 2d 49, 53, 573 N.W.2d 572 (Ct. App. 1997).  
No. 
2003AP988   
 
46 
 
access to affordable health care are legitimate legislative 
objectives."113  The legislative cap and the classification of 
medical malpractice victims appear to express a legislative 
balancing of objectives: to ensure quality health care in the 
state; to compensate injured victims of medical malpractice; and 
to protect health care providers from excessive costs of medical 
malpractice insurance. 
D. The Rational Basis 
1. 
¶97 We now explore whether a rational relationship exists 
between the legislative objective of compensating victims fairly 
and the classification of medical malpractice victims into two 
groups——those who suffer noneconomic damages under $350,000 and 
those who suffer noneconomic damages over $350,000.  With regard 
to the classification of victims, "the Equal Protection Clause 
'imposes a requirement of some rationality in the nature of the 
class singled out.'"114 
¶98 No one disputes that the cap does not apply equally to 
all medical malpractice victims.  Indeed, the burden of the cap 
falls entirely on the most seriously injured victims of medical 
malpractice.  Those who suffer the most severe injuries will not 
be fully compensated for their noneconomic damages, while those 
who suffer relatively minor injuries with lower noneconomic 
                                                 
113 Aicher, 237 Wis. 2d 99, ¶78. 
114 James v. Strange, 407 U.S. 128, 140 (1972) (quoting 
Rinaldi v. Yeager, 384 U.S. 305, 308-09 (1966)). 
No. 
2003AP988   
 
47 
 
damages will be fully compensated.115  The greater the injury, 
the smaller the fraction of noneconomic damages the victim will 
receive. 
¶99 According to a 1992 report by the Wisconsin Office of 
the Commissioner of Insurance, children from ages 0 to 2 with 
medical 
malpractice 
injuries 
comprise 
less 
than 
10% 
of 
malpractice claims, yet their claims comprise a large portion of 
the paid claims and expenses of insurers and the Fund.116  That 
is, "[p]laintiffs with the most severe injuries appear to be at 
the highest risk for inadequate compensation.  Hence, the worst-
off may suffer a kind of 'double jeopardy' under caps."117 
¶100 Young people are most affected by the $350,000 cap on 
noneconomic 
damages, 
not 
only 
because 
they 
suffer 
a 
disproportionate 
share 
of 
serious 
injuries 
from 
medical 
malpractice, but also because many can expect to be affected by 
their injuries over a 60- or 70-year life expectancy.  This case 
is a perfect example.  Matthew Ferdon has a life expectancy of 
69 years; he was injured at birth.  An older person with a 
                                                 
115 The lower the cap, the larger the number of people 
affected.  The higher the cap, the smaller the number of people 
affected. 
116 Office of Commissioner of Insurance, Wisconsin Health 
Care Liability Insurance Plan (WHCLIP): Preliminary Report on 
Medical Malpractice In Wisconsin, Special Report 16, 30, 38 
(1992). 
117 David Studdert et al., Are Damages Caps Regressive?  A 
Study of Malpractice Jury Verdicts in California, 23 Health 
Affairs 54, 65 (2004) ("Decisions to implement [damage caps] 
should be made with an awareness that they are likely to 
exacerbate existing problems of fairness in compensation."). 
No. 
2003AP988   
 
48 
 
similarly serious medical malpractice injury will have to live 
with the injury for a shorter period.  Yet both the young and 
the old are subject to the $350,000 cap on noneconomic damages.  
Furthermore, because an injured patient shares the cap with 
family members, the cap has a disparate effect on patients with 
families. 
¶101 The legislature enjoys wide latitude in economic 
regulation. But when the legislature shifts the economic burden 
of medical malpractice from insurance companies and negligent 
health care providers to a small group of vulnerable, injured 
patients, the legislative action does not appear rational.  
Limiting a patient's recovery on the basis of youth or how many 
family members he or she has does not appear to be germane to 
any objective of the law. 
¶102 If the legislature's objective was to ensure that 
Wisconsin people injured as a result of medical malpractice are 
compensated fairly, no rational basis exists for treating the 
most seriously injured patients of medical malpractice less 
favorably than those less seriously injured. No rational basis 
No. 
2003AP988   
 
49 
 
exists for forcing the most severely injured patients to provide 
monetary relief to health care providers and their insurers.118 
¶103 At least as to the legislative objective of ensuring 
fair compensation, the legislative classification created by a 
$350,000 cap on noneconomic damages is arbitrary and creates an 
undue hardship on a small unfortunate group of plaintiffs.  
Limitations on noneconomic damages are regressive.   
¶104 This court made these very same observations in 1995 
in Martin v. Richards.  Martin involved a successful due process 
challenge to the retroactivity of the $1,000,000 cap on 
noneconomic damage awards.  This court concluded that the cap 
unfairly sought to repair the tort system at the expense of 
those more seriously injured:   
There is yet one more measure of unfairness that the 
cap extracts, not just to the Martins but to all 
people whose noneconomic damages exceed [the cap].  
The underlying assertion of the defendants, and of all 
who seek to impose a cap, is that the tort system is 
"broke" or at least badly in need of repair.  Assuming 
the truth of that assertion for the sake of argument, 
the cap imposed here seeks to fix that system at the 
                                                 
118 A rationale sometimes offered for limiting recovery for 
noneconomic damages is that it is difficult to place a monetary 
value on such a loss, that money is an imperfect compensation 
for intangible injuries, and that sympathetic juries may award 
excessive sums for noneconomic damages.  Yet no one contends 
that the legislature determined that when someone is injured 
through medical malpractice, the maximum reasonable compensation 
for noneconomic damages is $350,000.  Apparently, $350,000 was 
selected not necessarily in relation to what constitutes 
reasonable compensation for the victim, but rather was arrived 
at as a result of its relation to the other legislative 
objectives such as lowering medical malpractice premiums and 
health care costs. 
No. 
2003AP988   
 
50 
 
sole expense of those most seriously injured.  That 
strikes us as neither fair nor equitable.  A person 
whose noneconomic damages is [at or below the cap] 
recovers 100 percent of his or her noneconomic loss.  
Those whose injuries exceed the cap receive but a 
fraction.119 
¶105 We therefore conclude that a rational relationship 
does not exist between the classifications of victims in the 
$350,000 
cap 
on 
noneconomic 
damages 
and 
the 
legislative 
objective of compensating victims of medical malpractice fairly. 
2. 
 
¶106 Providing 
reasonably 
priced 
medical 
malpractice 
insurance for health care providers is one of the objectives the 
legislature believed necessary to achieve quality health care 
for the people of the state.  The State has a legitimate 
interest in reasonably priced premiums for medical malpractice 
insurance if the cost or delivery of health care is threatened 
by escalating premiums.  The legislature apparently concluded 
that reducing the size of medical malpractice awards would 
reduce medical malpractice insurance premiums. 
 
¶107 As of 1997, health care providers in Wisconsin must 
carry primary insurance coverage of $1,000,000 per occurrence 
and $3,000,000 aggregate per year.120  The Fund then acts as an 
excess 
carrier, 
covering 
any 
losses 
above 
that 
amount.  
Therefore, "[s]ince the increase in the threshold to $1,000,000 
                                                 
119 Martin, 192 Wis. 2d at 210. 
120 Wis. Stat. § 655.23(4)(b)(2); 1997 Wis. Act 11; Analysis 
by the Legislative Reference Bureau for 1997 Assembly Bill 248, 
(available in Drafting Records for 1997 Wis. Act 11 at the 
Wisconsin Legislative Reference Bureau, Madison, WI). 
No. 
2003AP988   
 
51 
 
per incident and $3,000,000 aggregate, in 1997, the primary 
[medical malpractice insurance] carriers are subject to more of 
an impact from the enactment of Wisconsin Act 10."121 
¶108 We discuss first the relationship between the cap and 
premiums charged by primary medical malpractice carriers, and 
then we discuss the relationship between the cap and the 
assessments by the Fund.   
¶109 A $350,000 cap on noneconomic damages in medical 
malpractice actions intuitively appears to be rationally related 
to the legislative objective of lowering medical malpractice 
insurance costs to ensure quality health care for the people of 
the state.  If medical malpractice insurance costs are fueled by 
large judgments and settlements, as the legislature declared in 
1975, a cap would limit payouts by insurance companies; the 
lower payouts would enable insurance companies to reduce 
premiums to health care providers; a cap would enable insurance 
carriers to have greater predictability about the size of 
payouts and greater ease in calculating premiums and in setting 
more accurate rates; lower premiums and lower assessments by the 
Fund would decrease overall health care costs to consumers. 
¶110 The Wisconsin legislature chose a $350,000 cap on 
noneconomic damages as the means of achieving its objective.  We 
do not question the wisdom of that choice, but we must test 
whether the legislative hypothesis that a $350,000 cap on 
                                                 
121 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005). 
No. 
2003AP988   
 
52 
 
noneconomic damages bears a rational relationship to malpractice 
insurance premiums has a basis in reality. 
¶111 In 
testing 
the 
hypothesis, 
we 
begin 
with 
the 
recognition, in deference to the legislature, that to some 
extent the selection of any specific monetary limitation on 
noneconomic damages is arbitrary, in the sense that any 
limitation is based on imponderables.122  The legislature decides 
the specific numerical cap after balancing equal justice and 
fiscal considerations.123  The legislature's decision fixing a 
numerical cap must be accepted unless we can say it is very wide 
of any reasonable mark.124  We have said that a statutory limit 
on tort recoveries may violate equal protection guarantees if 
the limitation is harsh and unreasonable, that is, if the 
limitation is too low when considered in relation to the damages 
sustained.125  
¶112 Nevertheless, 
considerations 
of 
equal 
protection 
require some rationale for the cap and the figure chosen. 
                                                 
122 Stanhope, 90 Wis. 2d at 843. 
123 See Sambs, 97 Wis. 2d at 366-67; Stanhope, 90 Wis. 2d at 
843. 
124 Stanhope, 90 Wis. 2d at 843 n.11; Sambs, 97 Wis. 2d at 
367.  The court has adopted the principle that a legislative 
limitation on recovery violates due process if the limitation is 
harsh and unreasonable compared to the alleged damages.  Sambs, 
97 Wis. 2d at 368, citing Estate of Cargill v. City of 
Rochester, 406 A.2d 704, 708, 709 (N.H. 1979). 
125 Sambs, 97 Wis. 2d at 368 (quoting Cargill, 406 A.2d at 
708).  See also Stanhope, 90 Wis. 2d at 843; Maurin, 274 
Wis. 2d 28, ¶97 (Abrahamson, C.J., and Crooks, J., concurring). 
No. 
2003AP988   
 
53 
 
¶113 For the reasons we shall set forth below, we conclude 
that the $350,000 ceiling adopted by the legislature is 
unreasonable and arbitrary because it is not rationally related 
to the legislative objective of lowering medical malpractice 
insurance premiums.  
¶114 A statute may be constitutionally valid when enacted 
but may become constitutionally invalid because of changes in 
the conditions to which the statute applies.126  A past crisis 
does not forever render a law valid.127  
                                                 
126 See Hanauer v. Republic Bldg. Co., 216 Wis. 49, 58-59, 
255 N.W. 136 (1934) (quoting with approval Chastleton Corp. v. 
Sinclair, 264 U.S. 543, 547-48 (1924), stating that "[a] law 
depending upon the existence of an emergency or other certain 
state of facts to uphold it may cease to operate if the 
emergency ceases or the facts change even though valid when 
passed."  See also Baker v. Carr, 369 U.S. 186, 254 (1962) 
(citing Chastleton).  In United States v. Carolene Products Co., 
304 U.S. 144, 153 (1938), the Court stated:  
Where 
the 
existence 
of 
a 
rational 
basis 
for 
legislation 
whose 
constitutionality 
is 
attacked 
depends upon facts beyond the sphere of judicial 
notice, such facts may properly be made the subject of 
judicial 
inquiry, 
Borden's Farm 
Products 
Co. v. 
Baldwin, 
293 
U.S. 
194 . . . , 
and 
the 
constitutionality of a statute predicated upon the 
existence of a particular state of facts may be 
challenged by showing to the court that those facts 
have ceased to exist.  Chastleton Corp. v. Sinclair, 
264 U.S. 543 (1924). 
127 Norman J. Singer, 2 Sutherland Statutory Construction, 
§ 34:5, at 38, 40 (6th ed. 2000): 
Over a period of time social, political and economic 
changes may render a statute obsolete. . . . Where 
changed 
conditions 
have 
rendered 
a 
statute 
unconstitutional, the basis for its abrogation by 
court action is clear.  It is well settled that the 
continued 
existence 
of 
facts 
upon 
which 
the 
No. 
2003AP988   
 
54 
 
¶115 This court previously discussed caps on noneconomic 
damages and their impact on medical practice costs in 1995.  In 
Martin v. Richards, this court was confronted with a due process 
constitutional challenge to the retroactive application of the 
$1,000,000 cap.  The argument favoring the constitutionality of 
the retroactive application of the cap was that a cap on 
noneconomic damages prevents high awards and therefore keeps 
medical malpractice insurance premiums from rising. The court 
acknowledged having "seen these arguments raised in other forums 
and the media"128 and being "familiar with the generic reasons 
which are often cited for caps on noneconomic damages."129  
¶116 The court went on to conclude, however, that a 
retroactive 
application 
of 
the 
$1,000,000 
cap 
was 
unconstitutional because the cap would have a negligible effect 
on malpractice costs in the state and would not further the 
purposes asserted.130 
                                                                                                                                                             
constitutionality of legislation depends remains at 
all times open to judicial inquiry. 
See also Norman J. Singer, 1 Sutherland Statutory Construction, 
§ 2:6, at 41 (6th ed. 2000) ("Where validity of legislation 
depends on factual justification, if the pertinent facts are of 
such nature that they may change with the times, a statute or 
regulation which is valid at one time may become invalid at a 
later time, and vice versa." (citing Chastleton Corp. v. 
Sinclair, 264 U.S. 543 (1924))). 
128 Martin, 192 Wis. 2d at 203. 
129 Id. at 205. 
130 Id. at 203-05. 
No. 
2003AP988   
 
55 
 
¶117 The Martin court referred to several studies in making 
this point. 
¶118 The studies showed that the $1,000,000 cap had an 
insignificant, if any, effect on medical malpractice costs, the 
express 
purpose 
of 
this 
legislation. 
 
The 
Martin 
court 
summarized the evidence as follows: 
First, evidence indicates that few individuals receive 
noneconomic damages in excess of $1,000,000.  In fact, 
the U.S. Department of Justice Tort Policy Working 
                                                                                                                                                             
The North Dakota Supreme Court reached a similar conclusion 
about the effect of caps, based on a review of the record, that 
the legislature was "misinformed or subsequent events have 
changed the situation substantially," that is, that there was no 
medical malpractice "crisis."  Without a crisis to justify the 
restriction on recovery, North Dakota's $300,000 cap on medical 
malpractice economic and noneconomic damages violated equal 
protection guarantees.  Arneson, 270 N.W.2d at 136. 
Other courts have reached different conclusions about the 
effect of caps.  See, e.g., Judd v. Drezga, 103 P.3d 135, 141 
(Utah 2004) (examining articles and studies and determining that 
the cap was reasonably related to making medical malpractice and 
health insurance rates affordable and that caps did help achieve 
that goal, even if only in small part); Robinson v. Charleston 
Area Med. Ctr., 414 S.E.2d 877, 883 (W. Va. 1992) (upholding a 
$1 
million 
cap 
on 
noneconomic 
damages; 
the 
legislative 
classification will be upheld "if it is reasonably related to 
the achievement of a legitimate state purpose."); Zdrojewski v. 
Murphy, 657 N.W.2d 721, 737-38 (Mich. Ct. App. 2003) (cap on 
noneconomic damages upheld against, inter alia, equal protection 
challenge); Etheridge v. Med. Ctr. Hosps., 376 S.E.2d 525, 533-
34 (Va. 1989) (upholding Virginia's $750,000 cap on total 
recovery, including economic loss, against equal protection 
challenge); Murphy v. Edmonds, 601 A.2d 102, 114-16 (Md. 1992) 
(upholding 
Maryland's $350,000 cap 
on 
noneconomic damages 
against equal protection challenge); Adams v. Children's Mercy 
Hosp., 832 S.W.2d 898, 903-05 (Mo. 1992) (upholding a reduction 
of a $13 million noneconomic damage award to the capped amount 
of $250,000 against equal protection challenge for each of the 
two victims). 
No. 
2003AP988   
 
56 
 
Group found that only 2.7 percent of all medical 
malpractice claimants receive noneconomic damages in 
excess of $100,000.  See Report of the Tort Policy 
Working Group on the Causes, Extent and Policy 
Implications of the 
Current 
Crisis in 
Insurance 
Availability and Affordability, U.S. Dept. of Justice, 
at 66, February 1986.  Further, in those medical 
malpractice cases going to verdict where noneconomic 
damages above $100,000 are awarded, the noneconomic 
damages award averages between $428,000--$728,000.  
Id.  See also Gary J. Highland, California's Medical 
Injury Compensation Reform Act: An Equal Protection 
Challenge, 
52 
S. 
Cal. 
L. 
Rev. 
829, 
951 
n.745 
(recognizing that nationally, fewer than 1 percent of 
all awards in 1970 exceeded $100,000); Carson v. 
Maurer, 120 N.H. 925, 424 A.2d 825, 836 (1980) (noting 
as significant the fact that "'few individuals suffer 
non-economic damages in excess of $250,000' [the 
legislative 
cap 
in 
New 
Hampshire]" 
(citation 
omitted)).  Acknowledging that few individuals receive 
damages in excess of $1,000,000, we can safely assume 
that the number of persons retroactively affected by 
the law whose jury awarded noneconomic damages exceed 
$1,000,000 is too insignificant to have an affect 
[sic] on future malpractice costs.131 
¶119 The Martin court concluded then that "these assertions 
[of the effect of the cap on medical malpractice insurance 
costs] are supported by a paucity of evidence."132  Subsequent 
                                                 
131 Martin, 192 Wis. 2d at 203-04. 
132 Id. at 203. 
No. 
2003AP988   
 
57 
 
reports and commentary133 support this court's conclusions in 
Martin.134   
¶120 The Wisconsin Commissioner of Insurance is charged by 
law to report every two years on the impact of 1995 Wisconsin 
Act 10 (which adopted the cap and other measures).135  The 
Commissioner of Insurance's 2005 report on the impact of 1995 
Wis. Act 10 draws similar conclusions to the Commissioner's 
reports issued in 2003, 2001, 1999 and 1997.  The 2005 Report's 
bottom line conclusion is that "the only discernable effect on 
                                                 
133 Gfell, supra note 12, at 804 (citing U.S. General 
Accounting Office, Medical Malpractice: Effects of Varying Laws 
in the District of Columbia, Maryland and Virginia (1999)). 
134 Gfell, supra note 12, at 804 ("If medical malpractice 
insurance premiums have had any effect, most sources indicate it 
has 
been 
relatively 
small."); 
Elizabeth 
Stewart 
Poisson, 
Comment, Addressing the Impropriety of Statutory Caps On Pain 
and Suffering Awards in the Medical Liability System, 82 N.C. L. 
Rev. 759, 767-70 (2004) (discussing a variety of other factors 
that may well be more of an impact on medical malpractice 
premium rates). 
135 Act 10 adopted the $350,000 cap on noneconomic damages 
and the requirements that damages for future medical expenses in 
excess of $100,000 be paid out periodically and that evidence of 
collateral source payments be admissible.   
See 
Wis. Stat. § 601.427(9), 
requiring 
the 
report 
to 
evaluate the effects that the Act has had on the following:  (a) 
the number of health care providers practicing in Wisconsin; (b) 
the fees that health care providers pay to the Fund; and (c) the 
premiums that health care providers pay for health care 
liability insurance.  The Commissioner's report on the impact of 
the Act focuses on the $350,000 cap on noneconomic damages. 
No. 
2003AP988   
 
58 
 
these areas has been [a] reduction in the actuarially determined 
assessment levels [of the Fund] over the last seven years."136 
¶121 As 
to 
the 
Act's 
impact 
on 
medical 
malpractice 
insurance premiums, the Commissioner indicates that a number of 
factors affect malpractice premium insurance rates, and that "it 
would be difficult to draw any conclusions from premium numbers 
based solely on the enactment of Wisconsin Act 10."137  This is 
confirmation of the Commissioner's conclusions in 2003, 2001, 
1999 and 1997.138  The Commissioner also asserts that "[n]o 
direct correlation can be drawn between the caps enacted in 1995 
and current rate changes taking place in the primary market 
today."139 
                                                 
136 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005). 
137 Id. 
138 Id.; Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2003) 
("Therefore, it would be difficult to draw any conclusions from 
premium numbers based solely on the enactment of Wisconsin Act 
10."); Wisconsin Office of the Commissioner of Insurance, Report 
on the Impact of 1995 Wisconsin Act 10 (July 25, 2001) 
("Therefore, it would be difficult to draw any conclusions from 
premium numbers based solely on the enactment of Wisconsin Act 
10."); Wisconsin Office of the Commissioner of Insurance, Report 
on the Impact of 1995 Wisconsin Act 10 (May 6, 1999) 
("Therefore, it would be difficult to draw any conclusions from 
premium numbers based soley [sic] on the enactment of Wisconsin 
Act 10."); Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 20, 1997) 
("Therefore, it would be difficult to draw any conclusions from 
premium numbers based solely on the enactment of Wisconsin Act 
10."). 
139 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005). 
No. 
2003AP988   
 
59 
 
¶122 Nevertheless, the Commissioner does mention that "rate 
stability could be dramatically impacted for both the Fund and 
primary carriers should the caps be removed and insurers face 
unlimited non-economic damages."140  But private insurers do not 
face the possibility of "unlimited" noneconomic damages because 
private insurer's liability, even without a cap on noneconomic 
damages, is $1,000,000 per occurrence and $3,000,000 per year. 
¶123 Other studies support the Commissioner's finding that 
medical malpractice insurance premiums are not affected by caps 
on noneconomic damages.  For example, studies by the U.S. 
General Accounting Office, a non-partisan federal government 
entity that is the audit, evaluation, and investigative arm of 
Congress, have concluded that a number of factors go into 
whether medical malpractice premiums increase or decrease and 
that there is no definitive correlation between caps on 
noneconomic damages 
and 
lower medical 
malpractice premium 
                                                 
140 Id. 
No. 
2003AP988   
 
60 
 
rates.141  This conclusion was reached despite the recognition 
that losses on medical malpractice claims may constitute a large 
part of insurers' losses.142  
                                                 
141 U.S. General Accounting Office, Medical Malpractice 
Insurance: 
Multiple 
Factors 
Have 
Contributed 
to 
Increased 
Premium Rates, GAO-03-702 (June 2003) (indicating that while 
medical malpractice suits are one of the leading costs for 
insurance carriers, the effect on premium rates cannot be 
determined; a number of factors go into health care providers' 
premium rates); see also Melissa C. Gregory, Note: Capping 
Noneconomic Damages in Medical Malpractice Suits is Not the 
Panacea of the "Medical Liability Crisis", 31 Wm. Mitchell L. 
Rev. 1031, 1044-45 (2005) (same, citing General Accounting 
Office study); Health Insurance Association of America, Issue 
Brief: Why Do Health Insurance Premiums Rise (Sept. 2002) 
(indicating that rising consumer health insurance premiums are 
due to increases in the overall cost of health care and that 
"claims and consumer service" account for only 0.12 cents of 
every dollar spend on health care). 
The Wisconsin Academy of Trial Lawyers provided a study 
discussing the effects of noneconomic damage caps on premiums, 
payouts and the availability of insurance coverage.  See Martin 
D. Weiss et al., Medical Malpractice Caps: The Impact of Non-
Economic Damages Caps on Physician Premiums, Claims Payout 
Levels, and Availability of Coverage (June 2, 2003) (Amicus 
Brief of Wisconsin Academy of Trial Lawyers, App. E-1).  The 
problem with the Weiss Report, however, is that it uses only 
"median" figures in drawing its conclusions without providing 
the reader with the underlying data, averages, or even the range 
that gave rise to the median figures used.  Therefore, a state 
that shows a median decrease in premiums may have actually had 
an average increase in premiums, or vice versa.  It is 
impossible to draw any conclusions from the data and figures 
contained in the Weiss Report.  Weiss reports a 5% median 
decrease in medical malpractice premiums in Wisconsin from 1991-
2002. 
142 U.S. General Accounting Office, Medical Malpractice 
Insurance: 
Multiple 
Factors 
Have 
Contributed 
to 
Increased 
Premium Rates, GAO-03-702 (June 2003). 
No. 
2003AP988   
 
61 
 
¶124 One General Accounting Office study concluded that 
malpractice claims payments against all physicians between 1996 
and 2002 tended to be lower and grew less rapidly in states with 
noneconomic damage caps.143  The Office's ultimate conclusion was 
that these averages obscured wide variation between states and 
within a state from year to year.144  The study's malpractice 
claims payments in cap and non-cap states therefore do not 
provide a rational basis for the connection between the cap and 
lower premiums. 
¶125 Indeed, according to a General Accounting Office 
report, differences in both premiums and claims payments are 
affected by multiple factors in addition to damage caps, 
including state premium rate regulation, level of competition 
among insurers, and interest rates and income returns that 
affect insurers' investment returns.145  Thus, the General 
                                                 
143 U.S. 
General 
Accounting 
Office 
03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care 30 (Aug. 28, 2003), available at http://www.gao.gov  (also 
available in Matthew Ferdon's Supplemental Appendix). 
144 Id. 
145 Id. at 7. 
No. 
2003AP988   
 
62 
 
Accounting Office concluded that it could not determine the 
extent to which differences among states in premium rates and 
claims payments were attributed to damage caps or to additional 
factors.146  For example, Minnesota, which has no caps on 
damages, has relatively low growth in premium rates and claims 
payments.147 
¶126 One reason that the cap does not have the expected 
impact on medical malpractice insurance premiums may be that a 
very small number of claims are ever filed for medical 
                                                                                                                                                             
Another report also reached the conclusion that multiple 
factors affect medical malpractice premiums.  The report stated 
that "[p]remiums in states with a cap on awards were 17.1% lower 
than in states without such caps."  Kenneth E. Thorpe, The 
Medical Malpractice 'Crisis': Recent Trends And The Impact Of 
State 
Tort 
Reforms 
W4-26 
(Jan. 
21, 
2004), 
available 
at 
http://content.healthaffairs.org/cgi/reprint/hlthaff.w4.20v1.  
The report defined a "cap on awards" as including states with 
caps on noneconomic damages and states with caps on all damages—
noneconomic and economic.  It is therefore impossible to draw 
any conclusions from this report on a cap's effect on premiums 
if only noneconomic damages are capped. 
146 U.S. 
General 
Accounting 
Office 
03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care at 30, 37 (Aug. 29, 2003), available at http://www.gao.gov  
(also available in Matthew Ferdon's Supplemental Appendix).  See 
also Mitchell S. Berger, Note, Following the Doctor's Orders——
Caps on Non-Economic Damages in Medical Malpractice Cases, 22 
Rutgers L.J. 173, 187-88 ("Data of the National Association of 
Insurance Commissioners indicates that the caps are not likely 
to affect malpractice premiums greatly."). 
147 U.S. 
General 
Accounting 
Office 
03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care 37 (Aug. 29, 2003), available at http://www.gao.gov (also 
available in Matthew Ferdon's Supplemental Appendix). 
No. 
2003AP988   
 
63 
 
injuries,148 and even fewer of any eventual awards are for an 
amount above the cap.149  Another reason may be that insurers 
incur significant expense in defending non-meritorious claims.150  
The cap does nothing to eliminate the large number of meritless 
claims that are ultimately dismissed or dropped without any 
payments to the plaintiffs.151  It is a reasonable inference that 
                                                 
148 U.S. Dep't of Health & Human Servs., Addressing the New 
Health Care Crisis: Reforming the Medical Litigation System to 
Improve the Quality of Health Care, at 15 (Mar. 3, 2003) ("Most 
victims of medical error do not file a claim . . . only 1.53% of 
those who were injured by medical negligence even filed a 
claim."); see also Joint Economic Committee, The Perverse Nature 
of the Medical Liability System (March 2005) (noting that only 
3% of injured patients actually file suit against their health 
care provider). 
149 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (July 25, 2001) 
("Over the last couple of years the Fund has seen claims that 
[are affected by] Act 10 and the noneconomic damages cap, 
however, this experience has not been significant."); U.S. 
General Accounting Office, Medical Malpractice: Characteristics 
of Claims Closed in 1984, GAO/HRD-87-55 (Apr. 1987) (4% of all 
claims, with all damages included, were over $250,000.  Id. at 
2.  2.1% of noneconomic damages were over $200,000.  Id. at 
50.). 
150 U.S. Dep't of Health & Human Servs., Confronting the New 
Health Care Crisis: Improving Health Care Quality and Lowering 
Costs by Fixing Our Medical Liability System (July 25, 2002), 
available 
at 
http://aspe.hhs.gov/daltcp/reports/litrefm.htm, 
(citing U.S. General Accounting Office, Medical Malpractice: 
Characteristics of Claims Closed in 1984, General Accounting 
Office/HRD-87-55, 18 (Apr. 1987) (cited in Gregory, supra note 
141, at 1046). 
151 Gfell, supra note 12, at 779. 
No. 
2003AP988   
 
64 
 
the cost of defending meritless suits contributes significantly 
to malpractice insurance premiums.152 
¶127 Articles and studies, including a General Accounting 
Office study, indicated that in 1984, 57% to 70% of all claims 
resulted in no payment to the patient.153  Wisconsin statistics 
are similar.  According to information derived from the Office 
of Medical Mediation Panels,154 from 1989 through 2004 a little 
more than 10% of the claims filed resulted in verdicts, with 
only about 30% of those favorable to the plaintiffs.  In 2004, 
out of the 23 medical malpractice verdicts in Wisconsin, only 
four were in favor of the plaintiffs. 
¶128 Victims 
of 
medical 
malpractice 
with 
valid 
and 
substantial claims do not seem to be the source of increased 
premiums for medical malpractice insurance, yet the $350,000 cap 
on noneconomic damages requires that they bear the burden by 
being deprived of full tort compensation.155  While one federal 
Executive Branch agency, the Department of Health & Human 
Services, indicated that "[t]he number of payments of $1 million 
                                                 
152 Gregory, supra note 141, at 1046. 
153 U.S. General Accounting Office, Medical Malpractice: 
Characteristics of Claims Closed in 1984, GAO/HRD-87-55 (April 
1987); Gregory, supra note 141, at 1046. 
154 Litigants must file a request for mediation with the 
Medical Mediation Panel System prior to or simultaneously with 
filing a court action.  Office of Medical Mediation information 
is reprinted in the Amicus Curiae Brief & Appendix of the 
Wisconsin Academy of Trial Lawyers, at B-1. 
155 Berger, supra note 146, at 185-86. 
No. 
2003AP988   
 
65 
 
or 
more 
[for 
all 
medical 
malpractice 
damages, 
not 
just 
noneconomic damages, has] . . . exploded in the past 7 years [in 
a number of states other than Wisconsin],"156 the same has not 
been true in Wisconsin.  The Director of the Wisconsin Patients 
Compensation Fund has written that Wisconsin has "not seen the 
huge 
jury 
verdicts 
that 
have 
been 
reported 
in 
other 
states . . . ."157 
                                                 
156 U.S. Dep't of Health & Human Servs., Addressing the New 
Health Care Crisis: Reforming the Medical Litigation System to 
Improve the Quality of Health Care, at 12 (Mar. 3, 2003). 
In recent years, in conjunction with an Executive Branch 
push for federal medical malpractice reform, the Department of 
Health and Human Sevices' Office of the Assistant Secretary for 
Planning and Evaluation has produced a number of policy papers 
saying, in essence, "The litigation system is responsible for 
the crisis."  Id.  The report also notes that in two recent 
reports on Florida and Texas, noneconomic damages comprised 77% 
and 70%, respectively, of awards.  No specific percentages are 
given for other states without caps, but in discussing "mega-
awards" in non-cap states the report draws the conclusion, 
apparently from 17 jury "mega-awards" across 10 states spanning 
a six-year period, that noneconomic damages may comprise 50% or 
more of total awards. 
A 
recent 
article 
concluded 
that 
medical 
malpractice 
payments have leveled off since 2000 and that any rise in 
malpractice payments is proportionate with overall changes in 
health care spending.  Amitabh Chandra et al., The Growth of 
Physician 
Medical 
Malpractice 
Payments: 
Evidence 
from the 
National Practitioner Data Bank, W5-243, W5-247 (May 31, 2005), 
available at http://www.healthaffairs.org.  Furthermore, the few 
large awards are not growing at the same pace as awards that 
would not be affected by a cap on damages.  Id. 
157 Theresa 
Wedekind, 
Patients 
Compensation 
Claims 
Experience, WiscRisk (Wis. Patients Comp. Fund), Spring 2004, at 
2. 
No. 
2003AP988   
 
66 
 
¶129 Based on the available evidence from nearly 10 years 
of experience with caps on noneconomic damages in medical 
malpractice cases in Wisconsin and other states, it is not 
reasonable to conclude that the $350,000 cap has its intended 
effect of reducing medical malpractice insurance premiums.158  We 
therefore conclude that the $350,000 cap on noneconomic damages 
in medical malpractice cases is not rationally related to the 
legislative objective of lowering medical malpractice insurance 
premiums. 
3. 
¶130 We 
next 
examine 
whether 
the 
$350,000 
cap 
on 
noneconomic damages is rationally related to the legislative 
objectives of keeping the Fund's annual assessments to health 
care providers at a low rate and enabling the Fund to operate on 
a sound financial basis.  These objectives should ultimately 
                                                                                                                                                             
There are million dollar awards, but they are infrequent.  
For example, in a recent case a jury awarded damages of $17.4 
million on behalf of deceased Sarah Hegarty who, at age "16, 
died in 1998 after two years of medical treatment and 89 
operations that followed her [trip to the hospital where she 
received negligent treatment.]"  Derrick Nunnally, Judge Reduces 
Malpractice Award, Milwaukee J. Sentinel, Dec. 9, 2004, at B3.  
The circuit court apparently reduced the award, probably under 
its remittitur powers. 
158 Gfell, supra note 12, at 804 (citing U.S. General 
Accounting Office, Medical Malpractice: Effects of Varying Laws 
in the District of Columbia, Maryland and Virginia (1999)); see 
also State ex rel. Ohio Acad. of Trial Lawyers v. Sheward, 715 
N.E.2d 1062, 1092 (Ohio 1999) ("[A] 1987 study by the Insurance 
Service Organization, the rate-setting arm of the insurance 
industry, 
found 
that 
savings 
from 
various 
tort 
reforms, 
including a $250,000 cap on noneconomic damages, were 'marginal 
to nonexistent.'" (quoted source omitted)). 
No. 
2003AP988   
 
67 
 
relate to the primary objective of lowering health care costs 
for Wisconsin consumers. 
¶131 The Fund was created to provide excess liability 
coverage for health care providers.159  The Fund is managed by a 
Board of Governors160 and administered by the Office of the 
Commissioner of Insurance.161   
¶132 "The [Fund] is funded through annual assessments paid 
by providers and through investment income."162  Assessments are 
determined and collected based on a health care provider's 
specialty.  For example, certified nurse anesthetists are placed 
in a category of providers that is assessed lower fees; those in 
the highest-risk specialties, like neurosurgeons and obstetric 
surgeons, are placed in a category of providers that is assessed 
                                                 
159 Wisconsin Legislative Audit Bureau Audit Summary, Report 
94-29 (Dec. 1994). 
160 The Fund's Board consists of three insurance industry 
representatives, a member named by the Wisconsin Academy of 
Trial Lawyers, a member named by the State Bar Association, two 
members named by the Wisconsin Medical Society, a member named 
by the Wisconsin Hospital Association, four public members 
appointed by the Governor, and the Commissioner of Insurance, 
who serves as the Chair.  See Wis. Stat. § 619.04(3). 
161 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2003). 
162 Legislative Fiscal Bureau, Injured Patients and Families 
Compensation Fund (Insurance and Health and Family Services), 
Paper #450 to Joint Committee on Finance 2 (May 17, 2005) 
(hereinafter Legislative Fiscal Bureau Paper #450). 
No. 
2003AP988   
 
68 
 
higher annual fees.163  Health care providers are required to 
participate in the Fund unless they qualify for an exemption.164 
¶133 To determine how much the assessments will be for a 
given year, an actuarial consultant analyzes the Fund's loss 
experience and financial position and submits a fee level 
recommendation 
to 
a 
committee 
that 
in 
turn 
makes 
the 
recommendation for use by the Board.165 
                                                 
163 Legislative Fiscal Bureau, Patients Compensation Fund 
(Insurance and Health and Family Services), Paper #458 to Joint 
Committee on Finance 13 (Apr. 23, 2003) (hereinafter Legislative 
Fiscal Bureau Paper #458). 
164 Legislative Fiscal Bureau Paper #450.  Among the types 
of health care providers qualifying for exemptions are, for 
example: providers practicing less than 241 hours in a year; 
retired 
providers; 
state-, 
county- 
or 
municipal-employed 
providers; and providers who have never practiced in Wisconsin 
to date. 
165 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2003).  
The Board's rates often differ from the actuaries' recommended 
rates.  Legislative Fiscal Bureau Paper #450.  In five of nine 
fiscal years since July 1, 1985-86, the final fee levels were 
below the break-even fee levels estimated by the actuaries.  The 
result is that the Board's ability to reduce the deficits is 
impeded.  Testimony of Peter Farrow, Executive Assistant to the 
Commissioner of Insurance, Relating to Medical Malpractice 
Reform before the Assembly Committee on Insurance, Securities, 
and Corporate Policy by the Office of the Commissioner of 
Insurance, Jan. 19, 1995, at 4 (available in the Amicus Curiae 
Brief and Appendix of the Wisconsin Academy of Trial Lawyers at 
App. I). 
For the eight policy years from 1994-95 until 2001-02, the 
actuaries' recommendation was an average assessment increase, 
but 
the 
Board 
approved 
an 
average 
assessment 
decrease.  
Legislative Fiscal Bureau Paper #450; Legislative Fiscal Bureau 
Paper #458 at 5.  For the policy year of 2004-05, the Board 
decreased assessments by 20%.  Legislative Fiscal Bureau Paper 
#450 at 4. 
No. 
2003AP988   
 
69 
 
¶134 The Fund estimates its "loss liabilities . . . based 
on estimates of what [the Fund] may be required to pay for 
malpractice incidents that have occurred but may not yet have 
been settled or even reported."166  That is to say, total loss 
liability equals the amount the Fund would have to pay if every 
possible malpractice incident in a given year resulted in a 
lawsuit that eventually produced a settlement or trial verdict 
and award in favor of the injured patient. 
¶135 The Fund has assets.  The assets include cash and 
investment balances.  Investment income accounts for 33% of the 
Fund's balance growth, $410.8 million since the Fund was created 
in 1975.167 
¶136 When 
the 
Fund's 
"estimated 
loss 
liabilities 
exceed[] . . . cash 
and 
investments," 
the 
Fund 
runs 
an 
"accounting deficit."168  The accounting balance as of June 30, 
2003 was $7.9 million and was estimated to be approximately 
$21.0 million as of June 30, 2004.169  Conversely, if cash and 
investments are greater than the estimated loss liabilities, the 
Fund runs a positive accounting balance. 
                                                 
166 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients and Families Compensation Fund, at 4 (Oct. 2004). 
167 Id. at 13. 
168 Id. at 4. 
169 Id. at 5. 
No. 
2003AP988   
 
70 
 
¶137 The Fund uses an accrual accounting method.170  That 
means that health care providers are assessed fees based on 
"estimates of what all claims would total over time for 
incidents that occurred in any given year, rather than on what 
the payout amount was for that year."171  The accrual accounting 
method helps ensure that the Fund will have sufficient assets to 
pay all outstanding liabilities, including those not reported, 
if the Fund were to be discontinued.172  The 1990s also saw the 
Fund's Board increase reserves to further ensure that it could 
pay any outstanding claims if the Fund was eliminated.173  As of 
June 30, 2003, the Fund's cash and investment balances have 
grown to $658.9 million.174 
¶138 The Fund has not always used the accrual accounting 
method.  For the first five years of the Fund's existence 
starting in 1975, it operated on a cash basis.175  That is, 
                                                 
170 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
171 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
172 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
173 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
174 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients and Families Compensation Fund 4 (Oct. 2004). 
175 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
No. 
2003AP988   
 
71 
 
health care providers were charged assessments based on the 
actual payout for malpractice claims in a given year.176 
¶139 Switching from the cash basis to accrual accounting 
was an attempt to improve the integrity of the Fund.  The 
accrual accounting method brings with it a degree of uncertainty 
because predicting what claims might be filed and eventually 
result in payment by the Fund is "highly uncertain," and the 
result has been that "actual expenditures have been much lower 
than projected expenditures."177  As a result, the Fund has 
historically 
paid 
out 
much 
less 
than 
its 
projected 
expenditures.178     
¶140 Since 
fiscal 
year 
1984-85, 
the 
loss 
liability 
estimates for the Fund have been reduced, both in years in which 
there was a cap and in years in which there was no cap.179    The 
actuarial original losses for the last 20 years have been 
reduced 
over 
time 
by 
a 
net 
amount 
of 
$217.3 
million, 
representing 13.9% of the original total losses estimated for 
those years.180 
                                                 
176 Legislative Fiscal Bureau Paper #450 at 3; Legislative 
Fiscal Bureau Paper #458 at 4. 
177 Legislative Fiscal Bureau Paper #450 at 5; Legislative 
Fiscal Bureau Paper #458 at 5. 
178 Legislative Fiscal Bureau Paper #450 at 5; Legislative 
Fiscal Bureau Paper #458 at 5. 
179 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients and Families Compensation Fund 5 (Oct. 2004). 
180 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients and Families Compensation Fund 16 (Oct. 2004). 
No. 
2003AP988   
 
72 
 
¶141 Predictions about jeopardy of the Fund's financial 
status as evidenced by oft-indicated deficits is unfounded, as 
the Fund actually ran surpluses in years both with and without a 
cap.     
¶142 Simply 
put, 
the 
actuaries 
have 
consistently 
overestimated the amount of losses the Fund would incur in any 
given year.  The overestimates of loss, sometimes nearly $200 
million in a given fiscal year, are illustrated by the following 
chart:  
 
 
Fiscal Year Ending 
Published Surplus 
(Deficit) 
Hindsight Surplus 
(Deficit) 
No Cap in Place (1979 – 1985) 
1979 
($728,759) 
($15,648,947) 
1980 
($1,919,872) 
($34,664,878) 
1981 
($7,016,326) 
($45,144,847) 
1982 
($8,954,431) 
($62,817,470) 
1983 
($19,826,057) 
($72,514,141) 
1984 
($49,623,089) 
($81,211,029) 
1985 
($79,624,322) 
($58,580,371) 
In 1986, noneconomic damages were capped at $1,000,000. 
1986 
($100,555,257) 
($69,795,008) 
1987 
($112,101,947) 
($32,740,686) 
1988 
($122,722,600) 
($25,156,233) 
1989 
($108,256,349) 
$14,292,005 
1990 
($73,597,992) 
$57,623,296 
No. 
2003AP988   
 
73 
 
1991 
($71,679,588) 
$94,005,693 
The $1,000,000 cap ended due to its "sunset" provision. 
1992 
($78,982,681) 
$110,252,749 
1993 
($71,613,641) 
$126,753,323 
1994 
($67,903,761) 
$120,337,198 
1995 
($57,722,772) 
$135,133,860 
Cap on noneconomic damages re-established at $350,000. 
1996 
($41,795,496) 
$161,537,129 
1997 
($44,094,214) 
$178,044,919 
Providers required to carry $1,000,000 of insurance. 
1998 
($19,383,934) 
$195,982,368 
1999 
$8,579,767 
$194,099,916 
2000 
$27,210,974 
$189,648,947 
2001 
$28,724,959 
$165,777,386 
2002 
$4,888,065 
$127,606,855 
2003 
$7,932,348 
$82,655,325 
2004181 
$24,616,324 
n/a182 
                                                 
181 The numbers come from the Fund's audits and actuary.  
See Legislative Audit Bureau, An Audit of: Patients Compensation 
Fund Fiscal Years Ended June 30, 1982 and 1981, 83-20 16 (June 
1983); Legislative Audit Bureau, 1986 Functional and Progress 
Report – Patients Compensation Fund, (Mar. 23, 1987) (Exhibit 
3); Legislative Audit Bureau, An Audit of: Patients Compensation 
Fund, 93-18 9, 10 (July 1993); Legislative Audit Bureau, An 
Audit of: Patients Compensation Fund, 94-29 17, 18 (Dec. 1994); 
Legislative Audit Bureau, An Audit: Patients Compensation Fund, 
98-7 11, 12 (June 1998); Legislative Audit Bureau, An Audit: 
Patients Compensation Fund, 01-11 23, 24 (June 2001); Milliman & 
Robertson, Inc., Memorandum (reprinted in part in the brief and 
appendix of the Wisconsin Academy of Trial Lawyers at Appendix 
J-1). 
No. 
2003AP988   
 
74 
 
 
¶143 According to the Legislative Fiscal Bureau's May 17, 
2005 report to the Joint Committee on Finance, the Fund's 
balance sheet through fiscal year 2003-04 appears as follows: 
 
Hindsight Restatement 
Based on 
Actuarial Studies 9/30/04 
 
Fund 
Financial 
Statement 
As Published Milliman183 
Aon184 
1. Total Fund Assets 
741,283,000 741,283,000 
741,283,000 
                                                                                                                                                             
The actuarial bases for the Fund's fiscal reports have been 
challenged.  In light of these challenges, the Legislative Audit 
Bureau, a nonpartisan legislative service agency responsible for 
conducting financial and program evaluation audits of state 
agencies, 
recommended 
in 
2001 
that 
the 
Office 
of 
the 
Commissioner of Insurance contract for an audit of actuarial 
methods and assumptions used in estimating the Fund's loss 
liabilities.  See Wisconsin Legislative Audit Bureau, An Audit: 
Injured Patients and Families Compensation Fund 6, 21 (Oct. 
2004). 
 
In 
February 
2005 
the 
Commissioner 
of 
Insurance 
contracted for an audit, but no report has been received.  
Legislative Fiscal Bureau Paper #450 at 9; Legislative Fiscal 
Bureau Paper #458 at 9. 
182 Hindsight means the actual deficit or surplus, not a 
forward-looking projected amount of the deficit or surplus. 
183 Long-time actuary for the Fund. 
184 New actuary retained to provide independent actuarial 
opinion of the Fund.   
No. 
2003AP988   
 
75 
 
2. Fund Undiscounted 
Unpaid Claim Liabilities 
880,445,000 786,030,000 493,625,000185 
3. Offset for Investment 
Income 
-213,948,000 -165,427,000 -105,638,000 
4. Fund Discounted Unpaid 
Claim Liabilities (2 + 3) 666,497,000 620,603,000 
387,987,000 
5. Total Fund Liabilities 716,667,000 670,773,000 
438,157,000 
6. Fund Surplus (1 – 5) 
24,616,000 
70,510,000 
303,126,000 
¶144 The above data illustrate that the Fund has operated 
and been fiscally sound when there were no caps on noneconomic 
damages, when there was a $1,000,000 cap on noneconomic damages, 
and since 1995 when there has been a $350,000 cap on noneconomic 
damages. The trend is likely to continue for the fiscal year 
ending in 2004: one actuary has projected the Fund's surplus for 
fiscal year 2003-04 as exceeding $303 million.186 
¶145 The actuaries estimate that if the cap were vitiated 
effective May 1995, the Fund's undiscounted, unpaid claim 
liabilities might increase by as much as $144 million as of June 
30, 2003.187  But the Wisconsin Legislative Fiscal Bureau 
                                                 
185 Unpaid 
claim 
liabilities 
as 
of 
9/30/04 
represent 
estimates at an 85% confidence percentile. 
186 Legislative Fiscal Bureau Paper #450 at 10-11. 
187 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients 
and 
Families 
Compensation 
Fund 
49 
(Oct. 
2004).  
According to the Legislative Fiscal Bureau, the retroactive 
amount of liability may increase by $150 million to $200 
million.  Legislative Fiscal Bureau Paper #450 at 8. 
No. 
2003AP988   
 
76 
 
concluded that if up to $300 million were transferred out of the 
Fund, and if the assessment remained static at $31 million per 
year (the 2003-04 level) for the next ten years, the Fund would 
still be left with assets of $134.2 million in 2012, not 
including potential financial liquidation penalties.188  The 
Fiscal Bureau concluded that the total assets in ten years could 
be sufficient to pay all claims, even with a static assessment 
of $31 million a year and a $300 million withdrawal.189 
¶146 Even though as enacted in 1975, chapter 655 did not 
initially contain a cap on noneconomic damages in medical 
malpractice 
actions,190 
the 
Fund's 
fiscal 
position 
was 
a 
consideration in the 1975 enactment.  Chapter 655 originally 
provided that if the Fund's cash flow were in jeopardy, there 
would be a $500,000 cap on certain damages.191  The $500,000 
cash-flow-dependent cap was apparently never triggered.  
                                                 
188 "The total assets in ten years could be sufficient to 
pay all claims . . . ."  Legislative Fiscal Bureau Paper #458 at 
10. 
189 Legislative Fiscal Bureau Paper #458 at 10. 
190 Maurin, 274 Wis. 2d 28, ¶51. 
191 Wisconsin Stat. § 655.27(6) (1975) read, in relevant 
part, as follows: 
AWARD LIMITATION. If, at any time after July 1, 1979, 
the commissioner finds that the amount of money in the 
fund has fallen below a $2,500,000 level in any one 
year or below a $6,000,000 level for any 2 consecutive 
years, an automatic limitation on awards of $500,000 
for any one injury or death on account of malpractice 
shall take effect.  This subsection does not apply to 
injury 
or 
death 
resulting 
from 
an 
incident 
of 
malpractice which occurred prior to the date on which 
No. 
2003AP988   
 
77 
 
¶147 The Fund's fiscal position was again a concern in the 
early 1980s during discussions about implementing a cap on 
damages 
in 
medical 
malpractice 
actions. 
 
In 
1983, 
the 
Commissioner of Insurance sent a letter to the Governor 
expressing concern that the Fund may experience an accrual 
deficit in the future.192  The Fund was not in danger of running 
a cash deficit.  The drafting records for the 1986 legislation 
indicate that from 1978 to 1981, claims, and the "severity" of 
the claims, were increasing.  The Governor responded that steps 
should be taken to ensure the Fund's financial position.193 
¶148 The Legislative Council's Special Study Committee on 
Medical Malpractice grappled with the various issues in medical 
malpractice.  In the May 1986 Special Session Assembly, the 
legislature adopted Bill 4, which capped noneconomic damages at 
$1,000,000.  This legislation contained a "sunset" provision, 
that is, the $1,000,000 cap on noneconomic damages was set to 
expire in 1991 unless the legislature renewed it.  The 
legislature did not renew the $1,000,000 cap on noneconomic 
damages, and therefore, from 1991 to 1994, noneconomic damages 
for medical malpractice claims were not capped. 
                                                                                                                                                             
such 
an 
award 
limitation 
takes 
effect. 
 
This 
subsection does not apply to any payments for medical 
expenses. 
192 Letter from Thomas O. Fox, Commissioner of Insurance, to 
Governor Anthony Earl (Oct. 25, 1983). 
193 Letter from Governor Anthony Earl to Thomas O. Fox, 
Commissioner of Insurance (Dec. 22, 1983). 
No. 
2003AP988   
 
78 
 
¶149 It was not until 1995 that a cap on noneconomic 
damages in medical malpractice actions again came into effect. 
As originally drafted, the bill set the cap on noneconomic 
damages in medical malpractice at $250,000, consistent with a 
1994 recommendation by the Special Committee created by the 
Fund's Board of Governors.    
¶150 The Special Committee's 1994 report194 analyzed the 
advantages and disadvantages of a $250,000 cap on noneconomic 
damages in medical malpractice actions.  According to the 
report, the advantages were as follows: 
                                                 
194 The Special Committee to the Fund's Board of Governors 
prepared and submitted a Report to the Joint Legislative Audit 
Committee dated June 13, 1994. 
In contrast with the Special Committee's recommendation, 
the Fund's Board of Governors recommended that a noneconomic 
damage cap be set at a level not to exceed $1 million.  
Commissioner of Insurance, 1994 Functional and Progress Report—
Patients Compensation Fund, at 4 (Feb. 22, 1995). 
The Wisconsin Legislative Council Study Committee's bill 
file contains letters from various individuals and groups 
suggesting a number of alternatives, ranging from no cap to a 
return to the $1,000,000 cap.  Predictably, groups aligned with 
doctors, insurance companies, and hospitals favored the $250,000 
cap.  Patients' advocates and lawyers suggested there be no cap.   
No 
documents 
indicate 
why 
$350,000 
was 
chosen 
over 
$250,000.  The inference, of course, is that in adopting a 
$350,000 cap on noneconomic damages in medical malpractice 
cases, as opposed to $250,000, the legislature sought to balance 
patients' 
compensation 
for 
injuries 
with 
the 
potential 
reductions of the Fund's assessments. 
No. 
2003AP988   
 
79 
 
• If the cap were retroactive it would reduce the 
deficit without collecting fees in excess of the 
actuarially determined break-even level;195 
• The cap reduces the future anticipated payments 
of the Fund; and 
• The cap may allow for claims to be settled more 
expeditiously.196 
¶151 The disadvantages of imposing a $250,000 cap on non-
economic damages were, according to the report, as follows: 
                                                 
195 The Fund had a deficit as of June 30, 1994, on an 
audited basis of $67.9 million.  See ¶142, supra, however, 
showing a $120.3 million hindsight surplus.   
The Fund's deficits are a projection of the unfunded 
liabilities that would remain outstanding if the Fund ceased to 
collect further assessments.  The deficit represents a long-term 
shortage in the cash and investments balance that eventually 
will be needed to make the Fund's projected payments.  The 
deficit was incurred primarily in its first 10 years of 
operation.  Had the Special Committee's proposal that the cap be 
applied retroactively been adopted, the cap would have helped 
the Fund's deficit position.  See Martin v. Richards, 192 
Wis. 2d at 156 (declaring the retroactive application of the 
$1,000,000 
cap 
unconstitutional 
on 
due 
process 
grounds).  
Because the damage cap does not apply to claims incurred prior 
to enactment of the cap, the $350,000 cap has no impact on the 
Fund's deficit position.  Memorandum from Robert L. Sanders, 
Milliman & Robertson, Inc., to Danford C. Bubolz, Chief, 
Patients Compensation Fund 3 (Jan. 18, 1995) (available in Bill 
File at the Wisconsin Legislative Council, Madison, Wisconsin); 
Commissioner of Insurance, 1994 Functional and Progress Report——
Patients Compensation Fund 3, 4 (Feb. 22, 1995); Wis. Patients 
Comp. Fund, Report To The Joint Legislative Audit Committee 
(prepared by the Special Committee of the Board of Directors) 
Executive Summary 3, 14 (June 13, 1994). 
196 Wisconsin Patients Compensation Fund, Report to Joint 
Legislative Audit Committee (prepared by the Special Committee 
of the Board of Governors), Executive Summary  at 14 (June 13, 
1994). 
No. 
2003AP988   
 
80 
 
• The cap limits a claimant's right to recovery for 
damages such as pain and suffering, loss of 
consortium, etc.; 
• The cap has the greatest impact on the most 
severely injured patients; and 
• The 
cap 
is 
subject 
to 
constitutional 
challenges.197 
¶152 The prediction was that a cap would reduce the 
assessments charged by the Fund.  To use the Special Committee's 
and Commissioner of Insurance's terminology, the Fund's break-
even funding level would be reduced with a $250,000 cap.  The 
break-even funding level is an estimate of assessment charges 
that would be needed to cover estimated losses for the year.198   
Over a five-year period beginning on June 30, 1994, if 
noneconomic damages were capped at $250,000, it was estimated 
that the Fund would have to take in approximately $67.8 million 
less in assessments on health care providers in order to break 
even.199 
¶153 The contention that assessments would be reduced if 
the cap were adopted is consistent with other reports to the 
legislature.  For example, a memorandum from Peter Farrow, the 
                                                 
197 Wisconsin Patients Compensation Fund, Report to Joint 
Legislative Audit Committee (prepared by the Special Committee 
of the Board of Governors), Executive Summary at 14 (June 13, 
1994). 
198 Wisconsin Legislative Audit Bureau, An Audit: Injured 
Patients and Families Compensation Fund 20 (Oct. 2004). 
199 Memorandum from Robert L. Sanders, Milliman & Robertson, 
Inc., to Danford C. Bubolz, Chief, Patients Compensation Fund 4 
(Jan. 18, 1995) (available in Bill File for 1995 Wis. Act 10 at 
the Wisconsin Legislative Council, Madison, Wisconsin). 
No. 
2003AP988   
 
81 
 
executive assistant to the Commissioner of Insurance, to 
Representative Sheryl Albers, Chair of the Assembly Committee on 
Insurance, 
Securities, 
and 
Corporate 
Policy, 
indicated 
a 
$350,000 cap would mean the Fund would have to take in $46 
million less in assessments from health care providers.200  If 
the cap were $1,000,000, the Fund would have to take in $32.3 
million less in assessments over that five-year period.201   
¶154 Fund 
assessments 
have 
been 
decreasing 
over 
the 
years.202 In five reports from the Commissioner of Insurance, for 
2005, 2003, 2001, 1999, and 1997, the Commissioner indicated 
that "the only discernible impact" of the $350,000 cap "on 
health care providers has been a reduction" in Fund assessments 
                                                 
200 Memorandum from Peter Farrow to Representative Sheryl 
Albers (Jan. 24, 1994) (available in Bill File for 1995 Wis. Act 
10 at the Wisconsin Legislative Council, Madison, WI).  
201 Memorandum from Robert L. Sanders, Milliman & Robertson, 
Inc., to Danford C. Bubolz, Chief, Patients Compensation Fund 4 
(Jan. 18, 1995) (available in Bill File for 1995 Wis. Act 10 at 
the Wisconsin Legislative Council, Madison, WI). 
Total fee assessments taken in from health care providers 
for the relevant five-period would be $335.2 million if there 
was no cap on noneconomic damages; $267.4 million with a 
$250,000 cap; and $302.9 million with a $1,000,000 cap.  
Memorandum from Robert L. Sanders, Milliman & Robertson, Inc., 
to Danford C. Bubolz, Chief, Patients Compensation Fund (Jan. 
18, 1995) (available in Bill File for 1995 Wis. Act 10 at the 
Wisconsin Legislative Council, Madison, WI). 
202 Legislative Fiscal Bureau Paper #450 at 4. 
No. 
2003AP988   
 
82 
 
collected.203  In any event, as we explain below, a reduction in 
the assessments is not necessarily germane to the legislative 
objectives of lowering health costs to consumers or ensuring the 
availability of doctors in the state. 
                                                 
203 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005) 
("Analysis of these statistics determined the only discernable 
effect . . . has been an estimated $89 million . . . reduction 
in the actuarially determined assessment levels . . . over the 
last seven years."); Wisconsin Office of the Commissioner of 
Insurance, Report on the Impact of 1995 Wisconsin Act 10, at 3 
(May 12, 2003) ("[T]he only discernable impact of Wisconsin Act 
10 on health care providers has been a reduction in fees 
collected . . . over the last seven years."); Wisconsin Office 
of the Commissioner of Insurance, Report on the Impact of 1995 
Wisconsin Act 10 (July 25, 2001) ("[T]he only discernable impact 
of Wisconsin Act 10 on health care providers has been a 
reduction in fees collected . . . over the last five years.  
However, the loss experience to date is too immature to validate 
the reduction."); Wisconsin Office of the Commissioner of 
Insurance, Report on the Impact of 1995 Wisconsin Act 10 (May 6, 
1999) ("Analysis of these statistics determined the only 
discernable effect on these areas has been [a] . . . reduction[] 
of fees collected . . . over the last five years.  However, it 
was further noted that loss experience to date is too immature 
to 
validate 
the 
reduction."); 
Wisconsin 
Office 
of 
the 
Commissioner of Insurance, Report on the Impact of 1995 
Wisconsin Act 10 (May 20, 1997) ("While analysis of these 
statistics determined that not enough time has elapsed since the 
enactment of Act 10 to allow for a conclusive analysis of its 
impact, it should be emphasized that explicit recognition of the 
cap has been made in the annual fee setting process for the 
Fund.  Specifically, a reduction in . . . fees paid by Wisconsin 
health care providers for fiscal years 1995-1996 through 1997-
1998."). 
Another factor that may or may not have contributed to 
lower assessments is that health care providers were required in 
1997 to carry increased levels of primary medical malpractice 
insurance.  Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005). 
No. 
2003AP988   
 
83 
 
¶155 The goal of lowering health care provider assessments 
motivated raising the minimum amount of malpractice insurance 
health care providers are required to carry from $400,000 per 
occurrence and $1,000,000 per year to $1,000,000 per occurrence 
and $3,000,000 per year.204  Testimony by Peter Farrow of the 
Office of the Commissioner of Insurance to the Assembly 
Committee 
on 
Judiciary 
offered 
the 
following 
observation 
regarding raising the minimum amount of malpractice insurance 
health care providers would have to carry: 
The actuaries for the Fund and the Plan have estimated 
that 
increasing 
the 
threshold 
[to 
$1,000,000/$3,000,000] will result in a reduction in 
fees providers pay to the Fund of 21 percent, and an 
increase to Plan policyholders ranging from 19 to 32 
percent, depending on provider class.205 
In effect, the Office of the Commissioner is saying that while 
Fund assessments on health care providers may go down, there 
will be  a corresponding increase for health care providers in 
their  malpractice insurance premiums.  In fact, for some health 
care providers the increase in malpractice insurance premiums 
may be greater than the reduction in Fund assessments.206  Any 
                                                 
204 1997 Wis. Act 11. 
205 Wisconsin Office of the Commissioner of Insurance, 
Testimony Relating to Assembly Bill 248 Before the Assembly 
Committee on Judiciary 2 (Apr. 15, 1997) (available at the 
Wisconsin Legislative Council, Madison, WI). 
206 The 
Fund's 
assessments 
are 
levied 
against 
broad 
categories of health care providers as compared with medical 
malpractice insurance policies, which reflect more nuanced 
underwriting of risk. 
No. 
2003AP988   
 
84 
 
reduction in Fund assessments as a result of raising the 
required level of insurance must be viewed with an understanding 
that costs of medical malpractice insurance will rise as a 
result because private insurers will be liable for increased 
amounts. 
 
¶156 So while Fund assessments may go down, it cannot be 
said that health care providers necessarily benefit from the 
reduction as a result of 1997 Wis. Act 11's requiring health 
care providers to shoulder more of the burden for private 
malpractice insurance. 
¶157 The Fund has also played an important role in 
contributing to Wisconsin's reputation as a desirable place for 
health care providers to practice.207  Since the Fund was created 
in 1975, only 609 out of 4,944 total claims have resulted in 
payment by the Fund.208  Not only has the Fund not had to pay out 
in over 87% of medical malpractice claims naming the Fund,209 but 
Wisconsin has "not seen the huge jury verdicts that have been 
reported in other states, although verdicts here occasionally 
range as high as three to eight million dollars."210  The nature 
of 
jury 
verdicts 
in 
Wisconsin 
has 
been 
attributed 
to 
                                                 
207 Wedekind, supra note 157, at 2. 
208 Id. at 1. 
209 Id. at 2. 
210 Id. at 1. 
No. 
2003AP988   
 
85 
 
Midwesterners' 
sensibility.211 
 
For 
example, 
"Wisconsin 
settlements and jury verdicts worked out to be $1,711 per 1,000 
people in the state" in 2001, while in "Pennsylvania, payouts 
came to $27,268 per 1,000 people."212 
¶158 The Fund has flourished both with and without a cap.  
If the amount of the cap did not impact the Fund's fiscal 
stability and cash flow in any appreciable manner when no caps 
existed or when a $1,000,000 cap existed, then the rational 
basis standard requires more to justify the $350,000 cap as 
rationally related to the Fund's fiscal condition. 
4. 
¶159 Next we turn to the legislature's fourth objective, 
lowering overall health care costs for the consumers of health 
care.   
¶160 The question we must answer is whether there is a 
conceivable set of facts from which the legislature could 
conclude that a $350,000 cap on noneconomic damages furthers the 
state's interest in controlling medical malpractice insurance 
                                                 
211 Tanya Albert, A Tale of Two States: Different Approaches 
to Tort Reform (May 12, 2003), available at http://www.ama-
assn.org/amednews/2003/ind03.htm#05. 
212 Id. 
No. 
2003AP988   
 
86 
 
costs for health care providers, thereby controlling health care 
costs for the people of the state.213   
¶161 As we have explained previously, a $350,000 cap on 
noneconomic damages appears, at first blush, to be related to 
the legislative objective of keeping overall health care costs 
down.  The central theory underlying the cap is that large 
payouts by insurance companies (because of large judgments and 
settlements) raise malpractice insurance premiums.  Therefore, 
the theory goes, a limitation on damages means insurance 
companies pay out less.  Because insurance companies are paying 
out less, they will be able to reduce the premiums they charge 
health care providers.  If insurance premiums decrease, health 
care providers should be able to charge less, thereby lowering 
health care costs for patients.   
¶162 The problem with this logic is that even assuming that 
a $350,000 cap affects medical malpractice insurance premiums 
and the Fund's assessments on health care providers, medical 
malpractice insurance premiums are an exceedingly small portion 
of overall health care costs.214   
                                                 
213 A National Association of Attorneys General report 
concluded that insurance rates have risen not as a result of a 
medical malpractice crisis but as a result of poor management.  
Furthermore, the medical malpractice insurance industry enjoys 
higher profits than comparable insurance sectors.  Gfell, supra 
note 12, at 803-04 (citations omitted). 
214 Gfell, supra note 12, at 800 (citations omitted). 
No. 
2003AP988   
 
87 
 
¶163 Overall health care costs in the United States are in 
excess of $1 trillion annually,215 and are expected to reach $2 
trillion by 2006.216  The direct cost of medical malpractice 
insurance is less than one percent of total health care costs. 
For example, in 1992, doctors paid five to six billion dollars 
in premiums, while the overall cost of health care nationwide 
reached $840 billion.217  This is consistent with the findings of 
                                                                                                                                                             
Because the cost of medical malpractice insurance premiums 
represents only a small component of the total burden borne by 
health care consumers, the Alabama Supreme Court concluded that 
"the correlation between the damage cap . . . and the reduction 
of health care costs to the citizens of Alabama is, at best, 
indirect and remote."  Moore v. Mobile Infirmary Ass'n, 592 So. 
2d 156, 168 (Ala. 1992). 
215 Alan Sager & Deborah Socolar, Health Care Costs Absorb 
One-Quarter of Economic Growth, 2000-2005, (Feb. 9, 2005), 
available at http://dcc2.bumc.bu.edu/hs/ushealthreform.htm. 
216 Joint 
Economic 
Committee, 
Liability 
for 
Medical 
Malpractice: Issues and Evidence 23 (May 2003), available at 
http://www.house.gov/jec/tort/05-06-03.pdf.  The U.S. Congress 
Joint Economic Committee has recently, in conjunction with 
efforts to pass federal medical malpractice tort reform, issued 
policy papers "focusing on the cost and impact [of] excessive 
litigation" on health care costs.  Id. at 1. 
The Joint Economic Committee's primary task is reviewing 
economic conditions and to recommend improvements in economic 
policy.  The Committee is not an independent or nonpartisan 
organization.  The Committee's makeup reflects the makeup of the 
U.S. House of Representatives and U.S. Senate.  This means that 
60% of the Committee's current members are members of the 
Republican Party (six representatives and six senators); 40% are 
members of the Democratic Party (four representatives and four 
senators). 
 
The 
current 
chairman 
of 
the 
Committee 
is 
Representative Jim Saxton (R-NJ). 
217 Gfell, supra note 12, at 800 (citations omitted); 
Berger, supra note 146, at 176 (citation omitted). 
No. 
2003AP988   
 
88 
 
several commentators who conclude that medical malpractice 
insurance-related costs range from 0.56% to 2% of overall health 
care costs.218  The non-partisan Congressional Budget Office 
recently found that "even large savings in premiums can have 
only a small direct impact on health care spending——private or 
                                                 
218 See, e.g., David B. Simpson, Compulsory Arbitration: An 
Instrument of Medical Malpractice Reform and a Step Towards 
Reduced Health Care Costs?, 17 Seton Hall Legis. J. 457, 459-60 
(1993) (finding that in 1991 not even one percent of the total 
costs associated with health care could be attributed to medical 
malpractice premiums); 
Dennis 
J. 
Rasor, 
Mandatory Medical 
Malpractice Screening Panels: A Need to Reevaluate, 9 Ohio St. 
J. on Disp. Resol. 115, 119 (1993) (concluding that "[t]he cost 
of medical malpractice insurance can not be greatly responsible 
for the increase in the cost of medical care."); David Morrison, 
In Search of Savings: Caps on Jury Verdicts Are Not a Solution 
to Health Care Crisis, 7 Loy. Consumer L. Rep. 141, 149 (1995) 
(showing that Indiana's cap on damages has not resulted in a 
savings for health care consumers); Jacqueline Ross, Note, Will 
States Protect Us, Equally, From Damage Caps in Medical 
Malpractice Litigation?, 30 Ind. L. Rev. 575, 588 (1997) 
(medical malpractice insurance rates are a tiny percentage of 
overall health care costs); W. John Thomas, The Medical 
Malpractice "Crisis": A Critical Examination of a Public Debate, 
65 Temp. L. Rev. 459, 506 n.329 (1992) (malpractice insurance 
premiums are less than one percent of health care costs); Thomas 
Horenkamp, 
Comment, 
The 
New 
Florida 
Medical 
Malpractice 
Legislation and Its Likely Constitutional Challenges, 58 U. 
Miami L. Rev. 1285, 1326 (2004) (medical malpractice insurance 
premiums 
amounted 
to 
one 
percent 
of 
total 
health 
care 
expenditures in 1988, 0.56% in 2000, and approximately one 
percent in 2004); Paul C. Weiler, Reforming Medical Malpractice 
in a Radically Moderate——and Ethical——Fashion, 54 DePaul L. Rev. 
205, 208 (2005) (malpractice insurance and litigation costs are 
approximately one percent of total health care costs); Geoff 
Boehm, Debunking Medical Malpractice Myths: Unraveling the False 
Premises Behind "Tort Reform", 5 Yale J. Health Pol'y & Ethics 
357, 362 (2005) (suggesting the cost of medical malpractice 
insurance is about two percent of total health care costs). 
No. 
2003AP988   
 
89 
 
governmental——because malpractice costs account for less than 2 
percent of that spending."219 
¶164 The figures are similar in Wisconsin.  Of every $100 
spent on health care in Wisconsin between 1987 and 2002, less 
than one dollar can be traced to medical malpractice related 
costs.220     
¶165 Therefore, even if the $350,000 cap on noneconomic 
damages would reduce medical malpractice insurance premiums, 
this reduction would have no effect on a consumer's health care 
costs.  Accordingly, there is no objectively reasonable basis to 
conclude that the $350,000 cap justifies placing such a harsh 
burden on the most severely injured medical malpractice victims, 
many of whom are children. 
¶166 We agree with those courts that have determined that 
the correlation between caps on noneconomic damages and the 
                                                 
219 Congressional Budget Office, Limiting Tort Liability for 
Medical Malpractice (Jan. 8, 2004) (available in Matthew 
Ferdon's Supplemental Appendix). 
220 Medical 
malpractice 
insurance 
costs 
have 
steadily 
decreased as a percentage of health care expenditures in 
Wisconsin from just over 1.01% of health care expenditures in 
1987 to .402% in 2002.  The decrease is in both years with and 
without a cap on noneconomic damage awards.  See Amicus Brief of 
Wisconsin Academy of Trial Lawyers, Appendix C-1, calculations 
derived from Office of the Commissioner of Insurance, Wisconsin 
Insurance Report years 1987-2002, and U.S. Census Bureau, 
Statistical Abstract of the United States: 2003 at 104, 107.   
No. 
2003AP988   
 
90 
 
reduction of medical malpractice premiums or overall health care 
costs is at best indirect, weak, and remote.221   
5. 
¶167 To ensure quality health care in Wisconsin, the state 
has to 
attract and retain 
health 
care providers. 
 The 
availability of health care providers is dependent on the 
availability of reasonably priced medical malpractice insurance, 
according to the 1975 legislative findings.222  The legislature 
                                                 
221 See, e.g., Martin, 192 Wis. 2d at 204-05; Moore, 592 So. 
2d at 168 ("We conclude that the correlation between the damages 
cap imposed by § 6-5-544(b) and the reduction of health care 
costs to the citizens of Alabama is, at best, indirect and 
remote."); Carson, 424 A.2d at 836 ("We find that the necessary 
relationship between the legislative goal of rate reduction and 
the means chosen to attain that goal is weak . . . .").  See 
also 
Judd, 
103 
P.3d 
at 
147 
(Durham, 
C.J., 
dissenting) 
("Discussing his landmark Harvard study on medical malpractice, 
Paul Weiler notes the critical limitations of available evidence 
in determining the relationship between medical malpractice 
litigation and insurance premiums and the inherent unfairness 
and high social cost of damage caps as a response in the absence 
of any showing of their effectiveness."). 
222 In 
Wisconsin, the 
Wisconsin 
Health 
Care 
Liability 
Insurance Plan acts "as the insurer of last resort for doctors, 
hospitals, and other health professionals who are unable to find 
coverage in the private market."  See Office of the Commissioner 
of Insurance, Special Report, Wisconsin Health Care Liability 
Insurance 
Plan 
(WHCLIP): 
Preliminary 
Report 
on 
Medical 
Malpractice in Wisconsin, Report Number IP13-92, at 1 (1992). 
No. 
2003AP988   
 
91 
 
declared that "[t]he cost and the difficulty in obtaining 
insurance 
for 
health 
care 
providers 
discourages 
and 
has 
discouraged young physicians from entering into the practice of 
medicine in this state . . . ."223   
¶168 Studies indicate that caps on noneconomic damages do 
not affect doctors' migration.  The non-partisan U.S. General 
Accounting Office concluded that doctors do not appear to leave 
or enter states to practice based on caps on noneconomic damages 
in medical malpractice actions.224  The General Accounting Office 
found that despite extensive media coverage of physician 
departures from states, the numbers of physician departures 
reported were sometimes inaccurate and were actually relatively 
                                                                                                                                                             
A report focusing exclusively on Pennsylvania mentions the 
exit 
of 
a 
medical 
malpractice 
insurer 
from 
the 
medical 
malpractice insurance market.  Randall R. Bovbjerg & Anna 
Bartow, Understanding Pennsylvania's Medical Malpractice Crisis 
(2003), available at http://medliabilitypa.org/research/.  The 
report does not mention the national market share of the 
insurance company that is withdrawing from the market, but that 
insurance group accounted for only 3.3% of the Pennsylvania 
market.  Id. at 8.  The report draws no specific conclusions 
outside of Pennsylvania, noting that "Pennsylvania has been 
especially hard hit."  Id. at 45.  The report concludes, "No 
clear evidence yet exists as to the effects of the malpractice 
crisis on Pennsylvania's health care system."  Id. 
223 Maurin, 274 Wis. 2d at Appendix (legislative findings). 
224 U.S. General Accounting Office, Medical Malpractice: 
Implications of Rising Premiums on Access to Health Care, GAO-
03-836 (Aug. 2003) available at http://www.gao.gov (finding that 
based on available data, there is no indication that increased 
premium costs had a widespread impact on health care access; the 
American Medical Association disputed these findings). 
No. 
2003AP988   
 
92 
 
low.225  The General Accounting Office further reported that the 
problems it was able to confirm about shortages of doctors were 
limited to scattered instances, often in rural locations.  The 
Office found that in most cases, providers identified long-
standing factors in addition to malpractice pressures that 
affected the availability of services.226  
¶169 The conclusions reached by the General Accounting 
Office are supported by other reports and studies.227 
                                                 
225 U.S. 
General 
Accounting 
Office 
03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care 17 (Aug. 29, 2003), available at http://www.gao.gov. 
226 Id. at 13. 
227 See, e.g., Boehm, supra note 218, at 360-61 & n.17 
(citing several studies that concluded medical malpractice 
insurance rates are not the cause of doctors leaving a state). 
Isolated health care provider specialties in a few states 
have vigorously asserted that malpractice premiums are driving 
them out of state or practice.  See Lauren Elizabeth Rallo, 
Comment, The Medical Malpractice Crisis——Who Will Deliver the 
Babies of Today, the Leaders of Tomorrow?, 20 J. Contemp. Health 
L. & Pol'y 509, 510-511 (2004) (discussing the protests by 
surgeons and obstetricians in several "problem" states, of which 
Wisconsin is not one). 
No. 
2003AP988   
 
93 
 
                                                                                                                                                             
Not all studies have reached the same conclusion as the 
General Accounting Office study.  One recent study suggested 
that caps have resulted in an increased supply of certain types 
of doctors in rural areas.  William E. Encinosa & Fred J. 
Hellinger, Have State Caps On Malpractice Awards Increased The 
Supply 
of 
Physicians? 
(May 
31, 
2005), 
available 
at 
http://www.healthaffairs.org.  The article, published by the 
online journal Health Affairs, also noted that state caps on 
damages in medical malpractice actions instituted in 1985 had 
more of an effect than caps instituted in 1975.  Id.  The 
article cannot explain the anomaly.  The article also does not 
mention or address the fact that Wisconsin had no cap on medical 
malpractice damages from 1991 to 1995.  Further, the article 
noted that if the state's cap amount were set at a level over 
$250,000, there was no effect on the supply of doctors; if the 
cap amount were $250,000 there was only a 2% increase in the 
supply of doctors for some specialties in rural areas.  Id.  The 
study makes no findings as to health care providers as defined 
by Wis. Stat. § 655.002, only the much narrower category of 
licensed physicians. 
An unpublished study from 2003 paradoxically reaches the 
conclusion that a $500,000 cap on noneconomic damages increases 
the number of physicians in a state, but a $250,000 cap (or 
lower) does not.  That is to say, according to the study, there 
is no statistical significance to a $250,000 cap as it pertains 
to the number of physicians in a state.  See Jonathon Klick & 
Thomas Stratmann, Does Medical Malpractice Reform Help States 
Retain Physicians and Does It Matter? 9 (Oct. 2, 2003) 
(unpublished 
manuscript, 
available 
at 
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=453481).  The 
study also notes that caps on total medical malpractice damages 
do not attract physicians, and in fact may drive them away.  Id.  
The same with patients' compensations funds: If a state has a 
fund, it may drive physicians out of the state.  Id. at 9-10.  
The study offers no firm conclusion as to the reason behind the 
inconsistent results. 
No. 
2003AP988   
 
94 
 
¶170 The 
Wisconsin 
Office 
of 
the 
Commissioner 
of 
Insurance's biennial reports on the impact of 1995 Wis. Act 10 
examine the Act's impact on the number of health care providers 
in Wisconsin.  The Commissioner's 2003 report shows a slight 
decrease in the number of providers.  The Commissioner's 2005, 
2001, and 1999 reports show a slight increase in the number of 
health care providers.228  The Commissioner's reports do not 
attribute either the increases or decreases in the number of 
                                                                                                                                                             
Yet another study indicates that between 1970 and 2000 in 
states with caps on noneconomic damages, the percent increase in 
the number of physicians per capita was 95.7%.  For states with 
no cap, or a cap that was overturned, the increase in physicians 
was only 79.1%.  Fred J. Hellinger & William E. Encinosa, U.S. 
Dept. of Health & Human Services, The Impact of State Law 
Limiting Malpractice Awards on the Geographic Distribution of 
Physicians (July 3, 2003).  No state listed in this study, with 
or without a cap, showed a decrease in the number of physicians.  
In fact, Wisconsin saw, according to this study, an increase in 
physicians of 104.5%.  However, the study fails to take into 
account that for the 30-year period examined, Wisconsin did not 
have a cap for approximately half that time.  Wisconsin's 
increase in physicians is consistent with 11 other states with 
no caps on noneconomic damages, and Wisconsin had a smaller 
increase than seven states without noneconomic damage caps 
(Alabama, Maine, New Jersey, North Carolina, Rhode Island, South 
Carolina and Tennessee). 
228 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 (May 12, 2005); 
Wisconsin Office of the Commissioner of Insurance, Report on the 
Impact of 1995 Wisconsin Act 10 (May 12, 2003); Wisconsin Office 
of the Commissioner of Insurance, Report on the Impact of 1995 
Wisconsin Act 10 (July 25, 2001); Wisconsin Office of the 
Commissioner of Insurance, Report on the Impact of 1995 
Wisconsin Act 10 (May 6, 1999); Wisconsin Office of the 
Commissioner of Insurance, Report on the Impact of 1995 
Wisconsin Act 10 (May 20, 1997). 
No. 
2003AP988   
 
95 
 
health care providers to 1995 Wis. Act 10, much less to the 
$350,000 noneconomic damages cap.229 
¶171 Based on the available evidence, we cannot conclude 
that a $350,000 cap on noneconomic damages is rationally related 
to the objective of ensuring quality health care by creating an 
environment that health care providers are likely to move into, 
or less likely to move out of, in Wisconsin.  The available 
evidence indicates that health care providers do not decide to 
practice in a particular state based on the state's cap on 
noneconomic damages. 
¶172 Closely related to concerns about access is the 
practice of "defensive medicine."230  Among the legislature's 
findings were that as a result of medical malpractice actions, 
"health care providers are often required, for their own 
protection, to employ extensive diagnostic procedures for their 
patients, thereby increasing the cost of patient care."231  
                                                 
229 The recent study by Duke University Law Professor Neil 
Vidmar, commissioned by the Illinois State Bar Association, 
reported that despite claims by the American Medical Association 
that doctors were leaving the state as a result of medical 
malpractice actions and a rise in premiums, the facts did not 
support the AMA's assertion.  Neil Vidmar, Medical Malpractice 
and the Tort System in Illinois: A Report to the Illinois State 
Bar Association, 73-82 (May 2005) (provided to the Illinois 
General Assembly on May 10, 2005). 
230 Defensive medicine has been defined as occurring "when 
doctors order tests, procedures, or visits, or avoid high-risk 
patients or procedures, primarily . . . to reduce their exposure 
to malpractice liability."  Office of Technology Assessment, 
U.S. Congress, Defensive Medicine and Medical Malpractice 3 
(1994), available at http://www.wws.princeton.edu/~ota. 
231 § 1(1)(f), ch. 37, Laws of 1975. 
No. 
2003AP988   
 
96 
 
Defensive medicine, the argument goes, drives up the cost of 
health care because health care providers will order expensive 
and unnecessary tests to ensure that if they have to defend 
themselves against a claim, they can say they did everything 
possible for the health of the patient. 
¶173 There is anecdotal support for the assertion that 
doctors practice defensive medicine,232 although an "accurate 
measurement of the extent of this phenomenon is virtually 
impossible."233 
 
The 
Wisconsin 
Legislative 
Council 
Study 
Committee bill file contains a number of letters from doctors 
who assert they have practiced defensive medicine.  Similarly, 
the General Accounting Office recently found anecdotal evidence 
of 
the 
practice 
of 
defensive 
medicine 
by 
health 
care 
providers.234 
                                                 
232 American Medical Association, Medical Liability Reform – 
NOW! 
8 
(Dec. 
3, 
2004), 
available 
at 
http://www.ama-
assn.org/go/mlrnow (indicating that 76% of doctors "believe that 
concern about 
medical 
liability litigation 
has 
negatively 
affected their ability to provide quality care in recent 
years."). 
233 Office 
of 
Technology 
Assessment, 
U.S. 
Congress, 
Defensive Medicine and Medical Malpractice 3-4 (1994), available 
at http://www.wws.princeton.edu/~ota. But see American Medical 
Association, Medical Liability Reform – NOW! 8 (Dec. 3, 2004), 
available at http://www.ama-assn.org/go/mlrnow ("The costs of 
defensive medicine are estimated to be between $70-$126 billion 
per year."). 
234 U.S. 
General 
Accounting 
Office 
GAO-03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care 6 (Aug. 2003), available at http://www.gao.gov. 
No. 
2003AP988   
 
97 
 
¶174 Three independent, non-partisan governmental agencies 
have found that defensive medicine cannot be measured accurately 
and does not contribute significantly to the cost of health 
care.235  The General Accounting Office study found that "the 
overall prevalence and costs of [defensive medicine] have not 
been reliably measured."236  Findings about defensive medicine 
must be based on surveys of health care providers, and those 
                                                                                                                                                             
One study limited to elderly Medicare patients with heart 
disease attempts to quantify the extent to which doctors 
practice defensive medicine without attributing its conclusions 
to caps 
on noneconomic 
damages alone, but 
rather 
to a 
combination of eight different reform measures.  Daniel Kessler 
& Mark McClellan, Do Doctors Practice Defensive Medicine?, 111 
Quarterly J. of Econ. 353 (1996).  The study's conclusion is 
that "treatment of elderly patients with heart disease does 
involve 'defensive' medical practices . . . ."  Id. at 388.  The 
authors of the study "use[d] longitudinal data on all elderly 
Medicare recipients hospitalized for treatment of a new heart 
attack (acute myocardial infarction, or AMI) or of new ischemic 
heart disease (IHD) in 1984, 1987, and 1990 . . . " to draw 
their limited conclusions.  Id. at 354.  The study also defined 
"defensive medicine" as "a socially excessive level of care," 
which, in turn, was defined as "high expenditures per year of 
life saved . . . ."  Id. at 355.  Medicine was not "defensive" 
if it did not cost as much to keep the patient alive. 
235 Office 
of 
Technology 
Assessment, 
U.S. 
Congress, 
Defensive Medicine and Medical Malpractice 4 (1994), available 
at http://www.wws.princeton.edu/~ota; U.S. General Accounting 
Office GAO-03-836, Medical Malpractice: Implications of Rising 
Premiums on Access to Health Care 5-6 (Aug. 2003), available at 
http://www.gao.gov; Congressional Budget Office, Limiting Tort 
Liability for Medical Malpractice (Jan. 8, 2004) (available in 
Matthew Ferdon's Supplemental Appendix). 
236 U.S. 
General 
Accounting 
Office 
GAO-03-836, 
Medical 
Malpractice: Implications of Rising Premiums on Access to Health 
Care, at 6 (Aug. 2003), available at http://www.gao.gov. 
No. 
2003AP988   
 
98 
 
surveys typically ask [health care providers] if or 
how they have practiced defensive medicine but not the 
extent of such practices.  In addition, very few 
physicians tend to respond to these surveys, raising 
doubt about how accurately their responses reflect the 
practices of all [health care providers].  [The 
results] cannot be generalized more broadly [beyond 
anecdotal evidence].237 
Other studies have concluded that defensive medicine does not 
significantly affect the cost of medicine238 and "that 'some so-
called defensive medicine may be motivated less by liability 
concerns than by the income it generates for physicians or by 
the positive (albeit small) benefits to patients . . . . [The 
                                                 
237 Id. at 6, 28. 
238 Office 
of 
Technology 
Assessment, 
U.S. 
Congress, 
Defensive Medicine and Medical Malpractice 18 (1994), available 
at http://www.wws.princeton.edu/~ota. 
It is impossible to accurately measure the overall 
level and national cost of defensive medicine. 
. . . . 
Overall, a small percentage of diagnostic procedures——
certainly less than 8 percent——is likely to be caused 
primarily 
by 
conscious 
concern 
about 
malpractice 
liability.  This estimate is based on physicians' 
responses to hypothetical clinical scenarios that were 
designed 
to 
be 
malpractice-sensitive; 
hence, 
it 
overestimates the rate at which defensive medicine is 
consciously practiced in diagnostic situations.   
Id. at 1. 
 
No. 
2003AP988   
 
99 
 
Congressional Budget Office] believes that savings from reducing 
defensive medicine would be very small.'"239 
¶175 The evidence does not suggest that a $350,000 cap on 
noneconomic damages is rationally related to the objective of 
ensuring 
quality 
health 
care 
by 
preventing 
doctors 
from 
practicing defensive medicine.  We agree with the non-partisan 
Congressional Budget Office's finding that evidence of the 
effects of defensive medicine was "weak or inconclusive."240 
¶176 The North Dakota Supreme Court, reaching the same 
result we reach in this case in invalidating North Dakota's cap 
on 
medical 
malpractice 
economic 
and 
noneconomic 
damages, 
summarized its holding well, as follows: 
At the beginning of this opinion we quoted the 
preamble of the statute, containing its legislative 
purposes.  These include assurance of availability of 
competent medical and hospital services at reasonable 
cost, 
elimination 
of 
the 
expense 
involved 
in 
nonmeritorious 
malpractice 
claims, 
provision 
of 
adequate compensation to patients with meritorious 
claims, and the encouragement of physicians to enter 
                                                 
239 Boehm, supra note 218, at 363 (citing U.S. Cong. Budget 
Office, Limiting Tort Liability for Medical Malpractice 6 
(2004)).  See also Michelle M. Mello & Troyen A. Brennan, 
Deterrence 
of 
Medical 
Errors: 
Theory 
and 
Evidence 
for 
Malpractice 
Reform, 
80 
Tex. 
L. 
Rev. 
1595, 
1607 
(2002) 
(discussing potential deterrent effects of medical malpractice 
liability and indicating that "[i]t is likely that defensive 
medicine, to the extent that it ever took place, has diminished 
over time in response to the growing presence of managed 
care."). 
240 Congressional Budget Office, Limiting Tort Liability for 
Medical Malpractice (Jan. 8, 2004) (available in Matthew 
Ferdon's Supplemental Appendix). 
No. 
2003AP988   
 
100 
 
into practice in North Dakota and remain in such 
practice so long as they are qualified to do so. 
Does the limitation of recovery of seriously damaged 
or injured victims of medical negligence promote these 
aims?  We hold that it does not and that it violates 
the Equal Protection Clause of the State Constitution.  
Certainly the limitation of recovery does not provide 
adequate compensation to patients with meritorious 
claims; on the contrary, it does just the opposite for 
the most seriously injured claimants.  It does nothing 
toward 
the 
elimination 
of 
nonmeritorious 
claims.  
Restrictions on recovery may encourage physicians to 
enter into practice and remain in practice, but do so 
only at the expense of claimants with meritorious 
claims.241 
V. OTHER STATUTES 
¶177 The Fund (and the amici who support the Fund's 
position) 
argue 
that 
striking 
down 
the 
$350,000 
cap 
on 
noneconomic damages for common-law medical malpractice actions 
will mean the end to caps in a variety of other contexts.242  
This "the sky is falling" argument is unpersuasive.  We rest our 
decision on equal protection grounds.  Thus, the decision is 
limited to the statutes (Wis. Stat. §§ 655.017 and 893.55(4)(d)) 
at issue in the instant case and the facts and rationales 
motivating and supporting the enactment of the statutes. 
                                                 
241 Arneson, 270 N.W.2d at 135-36. 
242 Numerous non-party briefs were received in conjunction 
with this case.  Non-party briefs were filed by the Wisconsin 
Academy of Trial Lawyers; Wisconsin Coalition for Civil Justice 
and Wisconsin Manufacturers and Commerce; Wisconsin Hospital 
Association, 
Inc. 
and 
the 
American 
Hospital 
Association; 
Wisconsin Insurance Alliance, Physicians Insurance Company of 
Wisconsin and Property Casualty Insurers Association of America; 
and 
Wisconsin 
Medical 
Society 
and 
the 
American 
Medical 
Association. 
No. 
2003AP988   
 
101 
 
¶178 To determine the constitutionality of a statute, the 
classification in the statute must be analyzed along with the 
objectives of the statute.  The analysis of each statute under 
equal protection will be different if circumstances so warrant, 
because the facts and rationales motivating and supporting the 
enactment of the statutes will most likely be different.  Past 
Wisconsin challenges to various statutes that impact damages 
awards illustrate this point.    
¶179 First, our decision does not impinge on the no-fault 
guaranteed recovery workers' compensation system that replaced 
causes of action against employers.   
¶180 Second, and perhaps more closely analogous to the cap 
on noneconomic damage awards in the instant case, is Wis. Stat. 
§ 81.15, which caps the recovery of damages in actions for 
damages caused by highway defects.  This statute has survived a 
constitutional challenge.243  Municipalities were immune from 
suit at the adoption of the Wisconsin constitution, and concern 
about public finances as a result of numerous actions against 
municipalities for highway defects has justified the cap 
involved in that statute. 
¶181 Third, amici also point us to another arguably 
analogous statute: Wisconsin's comparative negligence provision, 
set forth in Wis. Stat. § 895.045(1).  This statute does not 
provide a cap on damages, but it adjusts the amount of damages 
                                                 
243 See Sambs v. City of Brookfield, 97 Wis. 2d 356, 293 
N.W.2d 504 (1980).  
No. 
2003AP988   
 
102 
 
owed by a particular defendant based on the comparative 
negligence of the plaintiff.  Amici do not argue that this 
statute violates equal protection.244       
¶182 The amicus brief of the Wisconsin Coalition for Civil 
Justice and Wisconsin Manufacturers and Commerce gives yet 
another example of what proponents of the cap call a statutory 
"manipulation" of a jury damage award, the so-called "seat belt 
defense."245  This statute operates as a reverse cap on damages. 
If a jury makes a finding, for example, that 30% of the damage 
caused to a plaintiff is due to the plaintiff's failure to wear 
a seat belt, the statute creates a ceiling on the plaintiff's 
liability for failure to wear a seat belt at 15%.  The argument 
seems to go to the right to trial by jury.  No equal protection 
challenges have been made to the seat belt defense statute.   
¶183 We are therefore unconvinced that our holding today in 
any way undermines any of the statutes discussed by the Fund and 
amici.246  
VI. CONCLUSION 
¶184 The court must presume that the legislature's judgment 
was sound and look for support for the legislative act.  But the 
court cannot accept rationales so broad and speculative that 
                                                 
244 See 
Guzman, 
240 
Wis. 2d 559, 
¶54 
(Schudson, 
J., 
dissenting) (asserting this statute is consistent with right to 
trial by jury).  
245 See Wis. Stat. § 347.48(2m)(g). 
246 Other statutes limit damages in certain circumstances.  
These statutes have not been raised or briefed by the parties. 
No. 
2003AP988   
 
103 
 
they justify any enactment.  "[W]hile the connection between 
means and ends need not be precise, it, at least, must have some 
objective basis."247   
¶185 While we adhere to the concept of judicial restraint 
that cautions against substituting judicial opinion for the will 
of the legislature, we do not abdicate judicial responsibility.  
To hold that a rational basis exists for the $350,000 statutory 
cap on noneconomic damages in medical malpractice cases would 
amount 
to 
applying 
a 
judicial 
rubber 
stamp 
to 
an 
unconstitutional statute. 
¶186 The invalid cap can be severed from the remainder of 
chapter 655 without frustrating the legislature's purpose in 
enacting chapter 655.248  Chapter 655 has existed both with and 
without a cap on noneconomic damages since 1975.   
¶187 For the reasons set forth, we conclude that the 
challengers have met their burden and have demonstrated that the 
$350,000 cap in Wis. Stat. §§ 655.017 and 893.55(4)(d) is 
unconstitutional beyond a reasonable doubt.  We hold that the 
$350,000 cap on noneconomic medical malpractice damages set 
forth in Wis. Stat. §§ 655.017 and 893.55(4)(d) (adjusted for 
inflation) violates the equal protection guarantees of the 
Wisconsin Constitution.  We therefore need not, and do not, 
address the other constitutional challenges Matthew Ferdon 
asserts against the cap. 
                                                 
247 Logan, 455 U.S. at 442 (Blackmun, J., concurring). 
248 See Wis. Stat. § 990.001(11). 
No. 
2003AP988   
 
104 
 
¶188 For the reasons set forth, we do not address the 
second and third questions presented and remand them to the 
circuit court.  Accordingly, we reverse the decision of the 
court of appeals and remand the cause to the circuit court for 
further proceedings not inconsistent with this opinion.  
By the Court.—The decision of the court of appeals is 
reversed and the cause remanded. 
 
 
 
 
No.  2003AP988.npc 
 
1 
 
¶189 N. PATRICK CROOKS, J.   (concurring).  I join the 
majority opinion and its holding that the $350,000 cap on 
noneconomic medical malpractice damages in Wis. Stat. §§ 655.015 
and 893.55(4)(d) (2001-02) (adjusted for inflation) violates the 
equal protection guarantees of Article I, Section 1 of the 
Wisconsin Constitution.  See majority op., ¶10.  I write 
separately, however, to emphasize that statutory caps on 
noneconomic damages in medical malpractice cases, or statutory 
caps in general, can be constitutional.  While the majority 
states 
that 
this 
case 
does 
not 
take 
issue 
with 
the 
constitutionality of all statutory caps, see majority op., ¶13, 
I want to stress that such caps can satisfy the requirements of 
the Wisconsin Constitution.  However, I am convinced that the 
current cap on noneconomic medical malpractice damages is 
unconstitutional.  The stated legislative objectives, when 
reviewed 
in 
accord 
with 
a 
rational 
basis 
test, 
provide 
insufficient 
justification 
for 
that 
cap 
under 
the 
equal 
protection clause and, further, the $350,000 cap is too low to 
satisfy the right to a jury trial as guaranteed in Article I, 
Section 5,249 when considered in conjunction with the right to a 
remedy in Article I, Section 9250 of the Wisconsin Constitution.   
                                                 
249 Article I, Section 5 of the Wisconsin Constitution 
states in relevant part:  
The right of trial by jury shall remain inviolate, and 
shall extend to all cases at law without regard to the 
amount in controversy; but a jury trial may be waived 
by the parties in all cases in the manner prescribed 
by law.  Provided, however, that the legislature may, 
from time to time, by statute provide that a valid 
verdict, in civil cases, may be based on the votes of 
No.  2003AP988.npc 
 
2 
 
¶190 In Wisconsin, the history behind the legislature's 
setting of caps for noneconomic damages in medical malpractice 
actions demonstrates arbitrariness, and leads to a conclusion 
that a rational basis justifying the present cap was, and is, 
lacking.  When Wis. Stat. ch. 655 was first enacted in 1975, 
there was no cap on noneconomic damages, but a $500,000 
conditional cap that could be triggered if the Wisconsin Patient 
Compensation Fund's cash-flow was in jeopardy.  See majority 
op., ¶133.  Then, in 1986, the legislature set the cap at 
$1,000,000.  This $1,000,000 cap remained in effect until 1991, 
when a sunset provision became effective.  There was no cap on 
noneconomic damages from 1991 until the legislature passed the 
current statutory cap of $350,000 in 1995.  Thus, the caps 
changed from nothing, to $1,000,000, back to nothing, and 
finally to $350,000 over the course of 20 years.     
¶191 The 
legislative 
history behind this 
current cap 
further reveals no rational basis justification for settling on 
the amount of $350,000.  The bill involved, as originally 
drafted, set a cap on noneconomic damages at $250,000.  However, 
a 
number 
of 
alternatives 
were 
suggested 
throughout 
the 
                                                                                                                                                             
a specified number of the jury, not less than five-
sixths thereof.   
250 Article I, Section 9 of the Wisconsin Constitution 
states in relevant part: "Every person is entitled to a certain 
remedy in the laws for all injuries, or wrongs which he may 
receive in his person, property, or character; he ought to 
obtain justice freely, and without being obliged to purchase it, 
completely and without denial, promptly and without delay, 
conformably to the laws."   
 
No.  2003AP988.npc 
 
3 
 
legislative process, ranging from $1,000,000, to nothing, to 
$250,000, to $350,000.  The final act set the cap at $350,000, 
without providing any explanation for the jump from the original 
$250,000.  See majority op., ¶¶136-37.  It appears quite clear 
that the legislature settled on an amount for the noneconomic 
damage cap without a rational basis for doing so.  It seems as 
if the $350,000 figure was plucked out of thin air.  Such an 
arbitrary cap, see majority op., ¶¶10, 177, "is violative of the 
equal protection clause in the Wisconsin Constitution, since it 
unduly burdens medical malpractice claimants without a rational 
basis that justifies . . ." its stated legislative objectives.  
Maurin v. Hall, 2004 WI 100, ¶214, 274 Wis. 2d 28, 682 N.W.2d 
866, (Abrahamson, C.J. and Crooks, J., concurring).  Statutory 
caps "'must be reasonable, not arbitrary, and must rest upon 
some ground of difference having a fair and substantial relation 
to the object of the legislation' in order to satisfy State 
equal protection guarantees."  Carson v. Maurer, 424 A.2d 825 
(N.H. 1980) (citation omitted).     
¶192 I also conclude that this cap on noneconomic damages 
violates Article I, Section 5 when linked to Article I, Section 
9 of the Wisconsin Constitution.  Although the majority opinion 
does not fully address this issue, I conclude that these two 
provisions of the Wisconsin Constitution may be applied together 
to determine whether the noneconomic damages cap of $350,000 was 
set unreasonably low, thus making it unconstitutional on that 
basis as well.  See Maurin, 274 Wis. 2d 28, ¶197 (Abrahamson, 
C.J. and Crooks, J., concurring).   In this case, the jury 
No.  2003AP988.npc 
 
4 
 
awarded Ferdon $700,000 in noneconomic damages.  The circuit 
court, however, had no choice but to reduce these damages to 
$410,322——the equivalent of the $350,000 cap adjusted for 
inflation.  Consequently, Ferdon lost a significant portion of 
the full damage award——more than 41 percent——as determined by 
the jury.  The jury verdict for damages was reduced by $289,678 
in light of the $350,000 cap.  While I recognize that the 
legislature may place a statutory cap on noneconomic damages in 
medical malpractice actions, the cap cannot be set unreasonably 
low.251  If $1,000,000 was the appropriate figure for the cap in 
1986, how can a $350,000 cap satisfy the constitutional 
requirements nine years later?  "Such a low cap on noneconomic 
damages effectively denies plaintiffs the constitutional right 
to trial by jury under Article I, Section 5 and, in turn, to a 
remedy as guaranteed by Article I, Section 9 of the Wisconsin 
Constitution."  Id. (footnote omitted).     
¶193 As Chief Justice Abrahamson and I noted in the Maurin 
concurrence, other 
jurisdictions have 
found 
similar 
state 
constitutional violations resulting from noneconomic damage caps 
in medical malpractice actions.  For example, the Florida 
Supreme Court struck down its legislature's attempt to impose a 
$450,000 cap on noneconomic damages.  In Smith v. Department of 
                                                 
251 I agree with the majority opinion that a statutory cap 
set too low may also violate the equal protection clause of the 
Wisconsin Constitution: "We have said that a statutory limit on 
tort recoveries may violate equal protection guarantees if the 
limitation is harsh and unreasonable, that is, if the limitation 
is too 
low when 
considered 
in relation 
to 
the damages 
sustained."  Majority op., ¶111 (citations omitted).   
No.  2003AP988.npc 
 
5 
 
Insurance, 507 So.2d 1080 (Fla. 1987), the court read two 
provisions of its state constitution——access to courts for 
redress 
for 
a 
particular 
injury 
and 
trial 
by 
jury——in 
conjunction with one another.  In doing so, the court stated:  
Access to courts is granted for the purpose of 
redressing injuries.  A plaintiff who receives a jury 
verdict for, e.g., $1,000,000, has not received a 
constitutional redress for injuries if the legislature 
statutorily, and arbitrarily, caps the recovery at 
$450,000.  Nor, we add, because the verdict is being 
arbitrarily capped, is the plaintiff receiving the 
constitutional benefit of a jury trial as we have 
heretofore understood that right.  Further, if the 
legislature 
may 
constitutionally 
cap 
recovery 
at 
$450,000, there is no discernible reason why it could 
not cap the recovery at some other figure, perhaps 
$50,000 or $1,000, or even $1.   
Id. at 1088-89. 
¶194 In Maine, the Supreme Judicial Court determined that a 
statutory cap set too low could result in a denial of the 
constitutional right to trial by jury and a denial of the right 
to a remedy.  In Peters v. Saft, 597 A.2d 50 (Me. 1991), the 
court stated that "it is conceivable that a statute could limit 
the measure of tort damages so drastically that it would result 
in a denial of the right to trial by jury and the denial of a 
No.  2003AP988.npc 
 
6 
 
remedy. . . ."  Id. at 53.  Other states have thought it 
necessary to overturn caps on similar grounds.252   
¶195 In sum, I conclude that this particular cap on 
noneconmic damages, set arbitrarily and unreasonably low by the 
legislature, violates Article I, Section 1, as well as Article 
I, Section 5 interpreted in conjunction with Article I, Section 
9, of the Wisconsin Constitution.   
¶196 Wisconsin can have a constitutional cap on noneconomic 
damages in medical malpractice actions, but there must be a 
rational basis so that the legislative objectives provide 
legitimate justification, and the cap must not be set so low as 
to defeat the rights of Wisconsin citizens to jury trials and to 
legal remedies for wrongs inflicted for which there should be 
redress.   
                                                 
252 See also Kansas Malpractice Victims Coalition v. Bell, 
757 P.2d 251 (Kan. 1988), overruled in part not relevant here, 
by Bair v. Peck, 811 P.2d 1176 (Kan. 1991) (The Kansas Supreme 
Court struck down a bill capping noneconomic damages, finding 
them to be arbitrary and in violation of both the right to trial 
by 
jury 
and 
the 
right 
to 
a 
remedy 
under 
the 
Kansas 
Constitution.); Lucas v. United States, 757 S.W.2d 687, 690 
(Tex. 1988) (citation omitted) (the Texas Supreme Court held 
that a statutory cap on noneconomic damages limited a litigant's 
"right of access to the courts for a 'remedy by due course of 
law.'").  
No.  2003AP988.npc 
 
7 
 
¶197 For these reasons, I respectfully concur. 
¶198 I am authorized to state that Justice LOUIS B. BUTLER, 
JR. joins in this concurrence. 
     
No.  2003AP988.dtp 
 
1 
 
¶199 DAVID T. PROSSER, J.   (dissenting).  Matthew Ferdon 
suffered a life-changing injury to his arm at birth as the 
result of medical malpractice.  He deserves fair compensation.  
Years ago the legislature established a patients compensation 
system, including mandatory health care provider insurance and a 
Patients Compensation Fund, that will assure that Matthew and 
other medical malpractice victims receive all the economic 
damages such as medical expenses, physical therapy, and loss of 
earnings and earning capacity, that a judge or jury is prepared 
to award. 
¶200 To stabilize liability costs in 
this 
guaranteed 
payment system, the legislature capped noneconomic damages that 
compensate a patient for such unquantifiable harms as pain and 
suffering.  In 1995 this cap was $350,000.  Because it was 
indexed for inflation, the cap today is $445,775.   
¶201 Caps on noneconomic damages are part of a broad 
legislative 
strategy 
to 
keep 
health 
care 
affordable 
and 
available in a way that will benefit Wisconsinites as a whole.  
Even when this strategy works exactly as intended, it has the 
effect of limiting the noneconomic damages for some patients.   
¶202 The principal issue presented in this case is whether 
the cap on noneconomic damages in Wisconsin medical malpractice 
cases is constitutional. 
¶203 Some members of the court, irrespective of what they 
say in this opinion, believe that all caps on noneconomic 
damages are unconstitutional.  In his concurrence, Justice N. 
No.  2003AP988.dtp 
 
2 
 
Patrick Crooks contends that some damage caps are constitutional 
but not the cap set by the legislature in this case.   
¶204 "Our form of government provides for one legislature, 
not two."  Flynn v. DOA, 216 Wis. 2d 521, 529, 576 N.W.2d 245 
(1998).  This court is not meant to function as a "super-
legislature," constantly second-guessing the policy choices made 
by the legislature and governor.  In part, this is because  
The 
legislature 
has 
the 
ability 
to 
hear 
from 
everybody——plaintiffs' 
lawyers, 
health 
care 
professionals, 
defense 
lawyers, 
consumer 
groups, 
unions, and large and small business. . . .  And, 
ultimately, legislators make a judgment.  If the 
people who elected the legislators do not like the 
solution, the voters have a good remedy every two 
years: retire those who supported laws the voters 
disfavor.   
Victor Schwartz, Judicial Nullification of Tort Reform: Ignoring 
History, Logic, and Fundamentals of Constitutional Law, 31 Seton 
Hall L. Rev. 688, 689 (2001).  
 
¶205 Today, a majority of this court utilizes several 
unacceptable tactics to invalidate a legislative act. 
 
¶206 First, 
the 
majority 
relies 
on 
the 
Wisconsin 
Constitution, not the United States Constitution, to nullify 
legislation.  This tactic assures that the court's decision will 
receive minimal scrutiny from legal scholars and no review by 
the United States Supreme Court. 
 
¶207 Second, the majority alters the test for reviewing the 
constitutionality of legislation on equal protection grounds, 
where the legislation does not affect a fundamental right.  It 
moves from a "rational basis" test, long established in our law, 
No.  2003AP988.dtp 
 
3 
 
to an intermediate scrutiny test which it euphemistically labels 
"rational basis with teeth."  
 
¶208 Third, 
the 
majority 
lays 
the 
groundwork 
for 
invalidating other damage caps and preventing the legislature 
from responding to this decision.  When the court insulates its 
decisions from review by the United States Supreme Court and 
response 
by 
other 
branches 
of 
state 
government, 
it 
is 
effectively 
destroying 
the 
checks 
and 
balances 
in 
our 
constitutional system. 
 
¶209 Fourth, the majority marshals non-Wisconsin studies 
and articles to undermine decisions made in and for Wisconsin by 
our legislature.  The use of these studies is selective, not 
comprehensive, so that non-Wisconsin studies that would support 
our legislation are played down, overlooked, or disregarded.  
 
¶210 Finally, in direct contradiction to the applicable 
level of scrutiny, the majority systematically minimizes the 
importance of facts that support the constitutionality of the 
legislation.  For instance, the majority ignores the fact that 
certain types of malpractice insurance premiums have actually 
decreased in Wisconsin, while similar premiums have climbed in 
other states.  
 
¶211 In this dissent, I will concentrate on three issues.  
First, I will discuss the majority's adoption of "rational basis 
with teeth," which, in reality, "is simply intermediate scrutiny 
without an articulation of the factors that triggered it."253  
                                                 
253 Gayle Lynn Pettinga, Note, Rational Basis With Bite: 
Intermediate Scrutiny By Any Other Name, 62 Ind. L.J. 779, 780 
(1987). 
No.  2003AP988.dtp 
 
4 
 
Second, I will discuss the broad sweep of the majority's 
rationale in relation to the narrow issue before the court.   
 
¶212 Finally, I will take issue with the majority's 
conclusion that the legislature had no rational basis for 
enacting the medical malpractice noneconomic damage cap. 
I 
¶213 First, 
I 
disagree 
with 
the 
majority's 
ultimate 
determination of the applicable level of scrutiny. 
¶214 Initially, the majority states: "We agree with the 
Fund 
that 
rational 
basis, 
not 
strict 
scrutiny, 
is 
the 
appropriate level of scrutiny in the present case."  Majority 
op., ¶65.  But the opinion gives rational basis a "makeover," 
and it reappears as "rational basis with teeth."  ("Whether the 
level of scrutiny is called rational basis, rational basis with 
teeth, or meaningful rational basis, it is this standard we now 
apply in this case."  Majority op., ¶80.)  This obfuscation 
implies that these three standards are equivalent.   
¶215 It should be apparent that these three different 
standards are not equivalent.254  The "rational basis with teeth" 
                                                 
254 In a few cases decided in the 1980s, the United States 
Supreme Court appeared to use a higher order of rational basis 
review in a handful of cases without ever using the phrase 
"rational basis with bite."  See, e.g., City of Cleburne v. 
Cleburne Living Ctr., 473 U.S. 432, 440 (1985); Williams v. 
Vermont, 472 U.S. 14, 22-23 (1985); Zobel v. Williams, 457 U.S. 
55 (1982). 
In City of Cleburne, Justice Thurgood Marshall blasted the 
majority for its deception: 
To be sure, the Court does not label its handiwork 
heightened scrutiny, and perhaps the method employed 
No.  2003AP988.dtp 
 
5 
 
                                                                                                                                                             
must hereafter be called "second order" rational-basis 
review rather than "heightened scrutiny." But however 
labeled, the rational basis test invoked today is most 
assuredly not the rational-basis test of Williamson v. 
Lee Optical of Oklahoma, Inc.; 348 U.S. 483, (1955), 
Allied Stores of Ohio, Inc. v. Bowers, 358 U.S. 522 
(1959), and their progeny.   
City of Cleburne, 473 U.S. at 458 (Marshall, J., concurring 
in part and dissenting in part). 
Justice Marshall forecast that "[t]he suggestion that the 
traditional 
rational-basis 
test 
allows 
this 
sort 
of 
searching inquiry creates precedent for this Court and 
lower 
courts 
to 
subject 
economic 
and 
commercial 
classifications 
to 
similar 
and 
searching 
'ordinary' 
rational-basis review——a small and regrettable step back 
toward the days of Lochner v. New York, 198 U.S. 45, 25 
S.Ct. 539, 49 L.Ed. 937 (1905)."  Id. at 459-60. 
The Lochner Court's infamous usurpation of legislative 
power has been relegated to the ash heap of history.  
Writing for the majority in Ferguson v. Skrupa, 372 U.S. 
726 (1963), Justice Black summed up the Court's repudiation 
of Lochner: 
[Lochner] has long since been discarded.  We have 
returned to the original constitutional proposition 
that courts do not substitute their social and 
economic beliefs for the judgment of legislative 
bodies, who are elected to pass laws.  As this Court 
stated in a unanimous opinion in 1941, "We are not 
concerned . . . with 
the 
wisdom, 
need, 
or 
appropriateness of the legislation."  Legislative 
bodies have broad scope to experiment with economic 
problems, and this Court does not sit to "subject the 
State to an intolerable supervision hostile to the 
basic principles of our Government . . . ." 
Ferguson, 372 U.S. at 730.   
This court has also recognized that rational basis with 
"bite" is equivalent to "a middle level tier of judicial 
scrutiny."  State ex rel. Watts v. Combined Community 
Servs., 122 Wis. 2d 65, 81 n.8, 362 N.W.2d 104 (1984).  See 
also S. Dakota Farm Bureau, Inc. v. Hazeltine, 202 F. Supp. 
2d 1020, 1048 n.3 (D.S.D. 2002) ("rational basis with bite" 
is "heightened scrutiny"); Am. Fed'n of Gov't Employees 
No.  2003AP988.dtp 
 
6 
 
standard is actually closer to the "intermediate level of 
scrutiny" than to rational basis review.  Compare the following 
definitions: 1) "Under intermediate scrutiny, the classification 
'must 
serve 
important 
governmental 
objectives 
and 
be 
substantially related to achievement of those objectives.'"  
Majority op., ¶63 (citing Craig v. Boren, 429 U.S. 190, 197 
(1976)); 2) The rational basis with teeth standard 
focuses on the legislative means used to achieve the 
ends.  This standard simply requires the court to 
conduct 
an 
inquiry 
to 
determine 
whether 
the 
legislation has more than a speculative tendency as 
the means for furthering a valid legislative purpose.  
"The State may not rely on a classification whose 
relationship to an asserted goal is so attenuated as 
to render the distinction arbitrary or irrational." 
Majority op., ¶78 (citing Gerald Gunther, In Search of Evolving 
Doctrine on a Changing Court: A Model for a Newer Equal 
Protection, 86 Harv. L. Rev. 1, 18-19 (1972)).  Equating 
"rational 
basis" 
and 
"rational 
basis 
with 
bite" 
is 
"indefensible," a mere sleight-of-hand presaging the application 
of heightened scrutiny without the label.255    
 
¶216 By contrast, the "rational basis" standard that this 
court has long adhered to is much more deferential.   
"A legislative classification is presumed to be 
valid.  The burden of proof is upon the challenging 
party to establish the invalidity of a statutory 
classification. 
 
Any 
reasonable 
basis 
for 
the 
classification will validate the statute.   . . . The 
basic test is not whether some inequality results from 
                                                                                                                                                             
(AFL-CIO) v. United States, 195 F. Supp. 2d 4, 12 n.12 
(D.D.C. 2002).   
 
255 Pettinga, supra n.1, at 802. 
No.  2003AP988.dtp 
 
7 
 
the classification, but whether there exists any 
reasonable basis to justify the classification.   
"Judicial response to a challenged legislative 
classification requires only that the reviewing court 
locate some reasonable basis for the classification 
made. 
 
The 
public 
policy 
involved 
is 
for 
the 
legislature, not the courts, to determine." 
Sambs v. City of Brookfield, 97 Wis. 2d 356, 371, 293 N.W.2d 504 
(1980) (citation omitted).  Perfection is not required: the 
rational basis test, properly stated and understood, "does not 
require a statute to treat all persons identically, but it 
mandates that any distinction have some relevance to the purpose 
for which the classification is made."  Doering v. WEA Ins. 
Group, 193 Wis. 2d 118, 131-32, 532 N.W.2d 432 (1995). 
 
¶217 The majority opinion's extensive discussion of the 
appropriate level of scrutiny stands in stark contradiction to 
our earlier cases.  In cases like Sambs, the court was able to 
state the rational basis test in a few paragraphs.  Here, pages 
and pages of obfuscation are required to disguise the majority's 
adoption of a new level of scrutiny never used before in 
Wisconsin.  This requires the concurrence to refer to "a 
rational basis test" rather than "the rational basis test."  
Justice Crooks' concurrence, ¶189.  In Wisconsin, until today, 
there was only one "rational basis test."  Now there are two. 
 
¶218 Constitutional law scholar Laurence Tribe describes 
rational basis with bite as "covertly heightened scrutiny," and 
warns that "covert use [of heightened scrutiny] presents dangers 
of its own."  2 Laurence H. Tribe, American Constitutional Law 
§ 16.3 at 1443, 1445 (2d ed. 1988).  Such a practice promotes 
No.  2003AP988.dtp 
 
8 
 
arbitrariness 
and 
allows 
courts 
to 
"remain 
essentially 
unaccountable."  Id. 
 
¶219 The "unaccountability" Professor Tribe warns of is 
simple to perceive.  In future cases, the majority will be able 
to rely on "rational basis with teeth" to invalidate legislation 
that does not suit the majority's fancy.   
 
¶220 Professor 
Tribe 
further 
cautions 
that 
"with 
no 
articulated principle guiding the use of this more searching 
inquiry, even routine economic regulations may from time to time 
succumb to a form of review reminiscent of the Lochner era."  
Today, the majority inaugurates the "Ferdon era."   
 
¶221 As the majority admits, majority op., ¶79 n.95, Tribe 
argues that "A far better approach would subject to heightened 
review only those classifications determined to be quasi-suspect 
after explicit judicial debate over the reasons for so regarding 
them . . . ."  2 Laurence Tribe, American Constitutional Law, 
§ 16.3 at 1445 (2d ed. 1988) (emphasis added). 
 
¶222 The choice of the applicable level of scrutiny is 
extremely important.  One treatise examining courts' treatment 
of noneconomic damage caps notes that,  
[t]hose decisions that have applied a rational basis 
test have almost uniformly upheld the statutory caps 
on noneconomic damages.  In contrast, where the courts 
have 
invalidated 
such 
laws 
on 
equal 
protection 
grounds, the governing test has been more stringent, 
usually an "intermediate" 
level 
of scrutiny, or 
"heightened scrutiny, but not as demanding as strict 
No.  2003AP988.dtp 
 
9 
 
scrutiny."  3 Jacob A. Stein, Stein on Personal Injury 
Damages § 19:3 (3d ed. 2005).256   
¶223 The majority equates "rational basis" and "rational 
basis with teeth" as if the choice between them is unimportant.  
In fact the opposite is true: when process is respected, the 
level 
of 
scrutiny 
is 
often 
outcome-determinative. 
 
The 
majority's result-oriented focus made it necessary to disguise 
the level of scrutiny in an attempt to justify its result. 
II 
 
¶224 Second, I object to the exceedingly broad scope of the 
majority's rationale, in light of the narrow issue before us.  
The majority's studies and statistics are geared to support its 
position that the cap violates equal protection because "[t]hose 
who suffer the most severe 
injuries 
will 
not 
be 
fully 
compensated for their noneconomic damages, while those who 
suffer relatively minor injuries with lower noneconomic damages 
will be fully compensated."  Majority op., ¶98.   
 
¶225 Such a statement would be true of any cap on damages.  
All caps have that effect.257  A perfect example is the cap 
                                                 
256 See also Mitchell S. Berger, Following the Doctor's 
Orders——Caps on Noneconomic Damages in Medical Malpractice 
Cases, 22 Rutgers L.J. 173, 195-96 (1990) ("Those courts which 
have invalidated caps invariably apply a higher degree of 
scrutiny than the rational relationship test."). 
257 See, e.g., Wis. Stat. § 893.82(6) (caps damages for 
plaintiffs suing state employees at $250,000).  See also 
Wis. Stat. § 893.80(3) 
(caps 
damages 
for 
certain 
offenses 
committed by government officials in their official capacity at 
$50,000; when offense is by a volunteer fire company, damages 
cannot exceed $25,000); Wis. Stat. § 895.04(4) (caps damages for 
wrongful death of a minor at $500,000 and wrongful death of an 
adult at $350,000); Wis. Stat. § 973.20(4m) (limits, in some 
circumstances, the amount of restitution to be paid by a 
defendant convicted of certain sexual crimes to $10,000). 
No.  2003AP988.dtp 
 
10 
 
limiting damages against state employees to $250,000.258  Under 
the majority opinion, a plaintiff alleging that a state-employed 
health-care provider injured him could claim an equal protection 
violation on several theories.  First, consistent with the 
majority opinion, the plaintiff could claim that the cap 
discriminates against plaintiffs who obtain awards above the 
cap.  Second, the plaintiff could complain that the cap 
discriminates against young patients and patients with multiple 
family members.  Third, the plaintiff could claim that the cap 
creates two classes of plaintiffs: those injured by state-
employed health care providers and those injured by private 
health care providers.  In light of this opinion, if an 
appropriate case were to come before us, the majority would have 
difficulty distinguishing a cap on malpractice by government-
employed health care providers from a cap on malpractice by 
private health care providers.     
¶226 It must be remembered in assessing the majority's 
disavowal of any impact of its decision beyond this case that 
the majority uses and quotes some of the reasoning that 
invalidated 
the 
retroactive 
application 
of 
a 
$1,000,000 
noneconomic damages cap.  Martin v. Richards, 192 Wis. 2d 156, 
210, 531 N.W.2d 70 (1995).  And just a year ago, two members of 
the current majority voted to strike down the cap on wrongful 
death damages.259  The majority denounces any cap on medical 
                                                 
258 Wis. Stat. § 893.82(6). 
259 Maurin v. Hall, 2004 WI 100, ¶197, 274 Wis. 2d 28, 682 
N.W.2d 866 (Abrahamson, C.J., and Crooks, J., concurring).   
No.  2003AP988.dtp 
 
11 
 
malpractice because it "diminishes the deterrent effect of tort 
law."  Majority op., ¶89.  The implication is that medical 
doctors feel free to act negligently simply because there is a 
cap on noneconomic damages.  The majority's citation of 
authority for this assertion is taken out of context, and stands 
only for the proposition that tort law is supposed to have a 
deterrent effect.  Nothing in the cited hornbook discusses 
whether caps add to or detract from this effect.   
III 
 
¶227 Finally, I strongly disagree with the majority's 
conclusion that the legislature did not have a rational basis to 
enact the cap on noneconomic damages in medical malpractice 
actions contained in Wis. Stat. § 893.55(4)(d). 
 
¶228 To understand the legislature's motivations, one must 
understand the history of the burgeoning medical malpractice 
problem over the final quarter of the twentieth century. 
 
¶229 As of 1975, the legislature believed it faced a health 
care crisis.  Ch. 37, Laws of 1975; see also Maurin v. Hall, 
2004 WI 100, ¶¶49-50, 274 Wis. 2d 28, 682 N.W.2d 866; State ex 
rel. Strykowski v. Wilkie, 81 Wis. 2d 491, 509, 261 N.W.2d 434 
(1978).  Accordingly, it created chapter 655 of the statutes.  
Ch. 37, Laws of 1975.  As part of that endeavor, it made eleven 
findings regarding the nature of the crisis.  § 1, ch. 37, Laws 
of 1975; majority op., ¶86 n.101.  Having set forth the 
legislative findings, the majority takes it upon itself to 
"summarize" 
the 
legislative 
findings 
into 
five 
judicial 
No.  2003AP988.dtp 
 
12 
 
findings.  Majority op., ¶86.  From these summarized findings, 
the majority "deduces" legislative objectives.   
 
¶230 The majority alleges that the first "objective" is 
"[e]nsur[ing] adequate compensation for victims of medical 
malpractice with meritorious injury claims."  Majority op., ¶91. 
 
¶231 The second objective, according to the majority, is to 
reduce the size of medical malpractice awards, thereby reducing 
malpractice insurance premiums.  Majority op., ¶92. 
 
¶232 The third objective, according to the majority, is to 
keep the annual Fund assessments at a reasonable rate and 
protect the Fund's financial status.  Majority op., ¶93. 
 
¶233 The fourth objective, according to the majority, is to 
reduce overall health care costs.  Majority op., ¶94. 
 
¶234 The fifth objective, according to the majority, is to 
encourage health care providers to practice in Wisconsin, 
reducing the practice of defensive medicine, and retaining 
malpractice insurers in Wisconsin.  Majority op., ¶95. 
 
¶235 The majority takes a novel approach to nullifying the 
damage cap.  Instead of concentrating its fire on Wisconsin's 
enactment 
of 
the 
damage 
cap, 
the 
majority 
attacks 
the 
effectiveness of any cap on noneconomic damages anywhere, and 
concludes that no such cap has had any effect at all on any of 
the five legislative objectives it deduced.   
¶236 The breadth of this holding is staggering.  It means 
that, contrary to the majority's narrow statement of the issue, 
it will be very difficult for Wisconsin legislators to re-enact 
a cap on noneconomic damages in the future.  The majority has 
No.  2003AP988.dtp 
 
13 
 
attempted to insulate its ruling from legislative reaction and 
redress by making its ruling so broad.   
 
¶237 Accordingly, 
in 
the 
following 
sections 
of 
this 
dissent, I am compelled to cite not only local studies that show 
the 
effectiveness 
of 
the 
cap 
contained 
in 
Wis. Stat. § 893.55(4)(d), 
but 
also 
national 
studies 
establishing the effectiveness of medical malpractice caps.   
 
¶238 The majority concludes that there is no rational 
relationship to any of the five objectives that it says might 
justify the cap.  It is wrong on every count. 
A. The Damage Cap Helps Ensure Adequate Compensation at 
Reasonable Cost 
 
¶239 The majority's first "legislative objective," ensuring 
adequate compensation for plaintiffs, is not explicitly listed 
in the statutory findings.  Nevertheless, it represents a 
reasonable summation of the whole purpose of Chapter 655 and 
exposes the absurdity of this court's holding that medical 
residents are not covered by Chapter 655.  See Phelps v. 
Physicians 
Ins. 
Co., 
2005 
WI 
85, 
___ 
Wis. 2d ___, 
___ 
N.W.2d ___.   
 
¶240 As Justice Roggensack carefully explains in her 
dissent, Wisconsin's patients compensation system guarantees 
unlimited coverage of economic damages obtained in a settlement 
or at trial.  It requires doctors to purchase liability 
insurance coverage and requires health care providers to pay 
annual assessments into the Fund.  Thus, a cap helps ensure 
No.  2003AP988.dtp 
 
14 
 
predictable and certain compensation for medical malpractice 
patients. 
 
¶241 By contrast, plaintiffs in other kinds of tort cases, 
even wrongful death suits in which there is a statutory cap, 
sometimes may be able to prove more than a million dollars in 
noneconomic damages but they are rarely able to recover that 
amount from defendants.  That is why underinsured motorist 
coverage is so important in motor vehicle accidents. 
 
¶242 The majority belittles Ferdon's $410,000 award in 
noneconomic damages to supplement his $403,000 award for future 
medical expenses.  This money will be paid.  How many motorists 
purchase $500,000 in liability coverage in the event they injure 
another motorist, or $500,000 in underinsured motorist coverage 
for situations in which they are injured by another driver?  If 
Ferdon were to suffer an equivalent injury in a work-related 
accident, would workers' compensation payments even come close 
to the total payment in this case? 
 
¶243 To 
understand 
the 
stabilizing 
effect 
of 
the 
noneconomic damage cap, one must understand the nature of the 
unreformed medical malpractice liability system.  "Taken as a 
whole, the [unreformed] medical liability system appears to be, 
quite simply, ineffective at consistently penalizing negligence.  
Appropriate acts of medical care can easily result in large 
No.  2003AP988.dtp 
 
15 
 
damage awards, while true acts of negligence go unpunished."260  
According to some studies, close to 70% of claims result in no 
payment, while a small amount of claims result in huge 
payments.261  Because of frustration with the system, only about 
1.5 percent of patients actually injured by medical malpractice 
even file a claim.262 
 
¶244 The 
Wisconsin 
Commissioner 
of 
Insurance 
recently 
extolled the predictability and stability the statutory cap 
                                                 
260 U.S. Congress, Joint Economic Committee, Liability for 
Medical Malpractice: Issues and Evidence at 11 (May 2003) 
(hereinafter U.S. Congress, Joint Economic Committee, Liability 
for Medical Malpractice).  The majority disparages the Joint 
Economic Committee report as a "policy paper," despite the fact 
that the report cites abundant independent statistical evidence 
in support of its bottom line conclusion: caps work.    
261 According to one recent study, in a sample of 5524 
malpractice cases, "0.9% resulted in jury verdicts for the 
plaintiff, 27.4% were settled before trial, 67.7% were dropped 
or dismissed, and 4% ended in a verdict for the defendant."  
William P. Gunnar, Is There An Acceptable Answer To Rising 
Medical Malpractice Premiums?, 13 Annals Health L. 465, 477 
(2004). 
262 United States Department of Health & Human Services, 
Addressing the New Health Care Crisis: Reforming the Medical 
Litigation System to Improve the Quality of Health Care 15 (Mar. 
3, 2003) (citing A.R. Localio, A.G. Lawthers, et al., Relation 
between malpractice claims and adverse events due to negligence: 
Results of the Harvard Medical Practice Study III, 325 New Eng. 
J. Med. 245 (July 25, 1991)) (hereinafter United States 
Department of Health & Human Services, Addressing the New Health 
Care Crisis).  The majority disparages the DHHS report as a 
"policy paper," despite the fact that the report cites abundant 
independent statistical evidence in support of its bottom line 
conclusion: caps work.   
No.  2003AP988.dtp 
 
16 
 
brings to the medical malpractice legal arena.263  Caps may 
contribute to an increased percentage of settlements, because 
plaintiffs are aware that unlimited noneconomic damages are not 
available. 
 
¶245 The majority focuses all its attention on the few 
medical malpractice patients who do not benefit from the 
statutory scheme.  This small minority of cases does not make 
the statutory scheme irrational. 
B. 
The Damage Cap Reduces the Size of Malpractice Awards, 
Thereby Reducing the Size of Malpractice Insurance Premiums 
 
¶246 The majority's second "objective" can be broken down 
into two component objectives: reducing the size of malpractice 
awards and reducing the size of malpractice insurance premiums.   
1. 
The Cap Reduces the Size of Malpractice Awards 
 
¶247 It would seem to be a simple, mathematical certainty 
that the cap on noneconomic damages reduces the size of some 
malpractice claims.  However, the majority finds a way to 
disagree even with this unremarkable proposition, relying on two 
principal sources: older studies quoted in Martin and reports by 
the Wisconsin Commissioner of Insurance.  One of the amici 
supporting the plaintiff asked the court to consider other 
national data such as the Internet "Weiss Ratings."  None of the 
three sources provides substantial support for the majority's 
position. 
                                                 
263 Wisconsin Office of the Commissioner of Insurance, 
Report on the Impact of 1995 Wisconsin Act 10 3-4 (May 12, 2005) 
(emphasis added) (hereinafter Report on the Impact of 1995 
Wisconsin Act 10). 
No.  2003AP988.dtp 
 
17 
 
a. 
Martin v. Richards 
¶248 In Martin, this court cited a 1986 study by the U.S. 
Department of Justice purporting to show that "few individuals 
receive noneconomic damages in excess of $1,000,000."  Martin, 
192 Wis. 2d at 203.  The Martin court also considered other 
courts' statements of the average level of awards as of 1970, 
and as of 1980.  Id.  I do not dispute the accuracy of these 20 
to 35-year old figures. 
¶249 Nonetheless, 
the 
medical 
malpractice 
climate 
has 
changed in recent decades. 
¶250 In 2003, a federal agency reported that "[t]he number 
of payments of $1 million or more reported to the [National 
Practitioner Data Bank] exploded in the past 7 years, not only 
in AMA crisis states such as New Jersey, Pennsylvania, and Ohio, 
but nationwide."264  In more than five percent of all claims 
resulting in payment, the payout exceeds $1 million.265  The 
maximum reported payout was $20,700,000.266  Seven of the twenty 
highest verdicts in 2001 and 2002 were in medical malpractice 
                                                 
264 United States Department of Health & Human Services, 
Addressing the New Health Care Crisis at 12. 
265 Id. 
266 Id. 
No.  2003AP988.dtp 
 
18 
 
cases.267  In a recent Wisconsin case, a jury awarded noneconomic 
damages of $17.4 million.268 
¶251 A substantial part of the huge awards are comprised of 
non-economic damages.  Recent studies have concluded that non-
economic damages comprise 77 percent of awards.269  In Texas, the 
average judgment in medical malpractice cases is now $2.1 
million; 70 percent of that figure, on the average, is 
noneconomic damages.270   
¶252 Last term in the Maurin case, a jury awarded the 
Estate of Shay Leigh Maurin $550,000 in noneconomic damages for 
her pain and suffering before her death.  The doctor's 
negligence in diagnosis occurred on March 6, 1996.  Shay died on 
March 8, 1996, less than 48 hours later.  Maurin, 274 
Wis. 2d 28, ¶¶9, 11.  During a substantial part of this time she 
was unconscious.  The facts of the case are tragic and heart-
wrenching.  But the fact that a jury awarded $275,000 in pain 
and suffering damages for each day she lived undermines many of 
the arguments made by the majority.   
 
 
                                                 
267 Gunnar, supra n.9, at 477. 
268 Derrick 
Nunnally, 
Judge 
Reduces 
Malpractice 
Award, 
Milwaukee Journal Sentinel (Dec. 9, 2004).  The trial judge 
reduced these noneconomic "pain and suffering" damages to about 
$12 million dollars plus interest, an amount roughly twenty-five 
times the current cap.   
269 United States Department of Health & Human Services, 
Addressing the New Health Care Crisis at 13. 
270 Id. 
No.  2003AP988.dtp 
 
19 
 
b. 
Report by Commissioner of Insurance 
¶253 Second, the majority relies on reports by Wisconsin's 
Commissioner of Insurance.  Specifically, the majority argues 
that the "bottom line conclusion" in the Commissioner's 2005 
report is that "the only discernable effect on these areas has 
been . . . [a] 
reduction 
in 
the 
actuarially 
determined 
assessment levels . . . over the last seven years."271 
¶254 In reality, the "bottom line" of the Commissioner's 
most recent report does not support the majority's position.  
Contrary to the majority's assertion, the Commissioner's 2005 
report does not "draw similar conclusions to the Commissioner's 
reports 
issued" 
in 
prior 
years. 
 
In 
the 
2005 
report, 
Commissioner Jorge Gomez stated: 
[I]t is important to note that any analysis of the 
effects of the enactment of Wisconsin act 10 is very 
difficult due to several factors including: 
Many of the payments made on claims are a result 
of a settlement and not a jury trial.  The 
settlement amount takes into consideration the 
caps 
that 
exist; 
therefore 
there 
is 
no 
discernable amount that can be attributed to a 
reduction due to the caps. 
It is not possible to determine the number of the 
claims that were not filed due to a limited 
amount of economic damages in addition to the 
caps. 
To 
conclude . . . Wisconsin's 
malpractice 
marketplace is stable.  Insurance is available 
and affordable, and patients who are harmed by 
malpractice occurrences are fully compensated for 
unlimited economic losses.  Tort reform of 1995, 
along with well regulated primary carriers and a 
                                                 
271 Majority op., ¶120. 
No.  2003AP988.dtp 
 
20 
 
well 
managed 
and 
fully 
funded 
Patients 
Compensation Fund has resulted in the stable 
medical 
malpractice 
environment, 
and 
the 
availability of health care in Wisconsin.272 
¶255 The Commissioner's new report makes plain the impact 
of 1995 Act 10.  The "bottom line conclusions" drawn by the 
Commissioner are as follows: 1995 Act 10 affects settlement 
amounts; it discourages some claims from being filed; and it has 
"resulted in [a] stable medical malpractice environment, and the 
availability of health care in Wisconsin."273  Accordingly, the 
Commissioner of Insurance, who is in an excellent position to 
evaluate the effect of 1995 Act 10, disagrees with the 
majority's conclusions. 
c. 
National Data 
¶256 Third, the majority cites a national study, the "Weiss 
Ratings," presented by the Wisconsin Academy of Trial Lawyers 
(WATL).274  This report, according to WATL, showed the lack of 
any connection between noneconomic damage caps, plaintiffs' 
awards, and malpractice premiums.  However, "this case is not 
about whether all caps, or even all caps on noneconomic damages, 
are constitutionally permissible.  The question . . . is a 
narrow one: Is the $350,000 cap . . . on noneconomic damages in 
medical malpractice cases set forth in Wis. Stat. §§ 655.017 and 
893.55(4)(d) constitutional?"  Majority op., ¶13.   
                                                 
272 Report on the Impact of 1995 Wisconsin Act 10 at 3-4 
(emphasis added). 
273 Id.; contra majority op., ¶120. 
274 Majority op., ¶123 n.141. 
No.  2003AP988.dtp 
 
21 
 
¶257 The Weiss report draws two broad conclusions.  The 
first conclusion is that noneconomic damage caps are not holding 
down damage awards; for example, the median award in Wisconsin 
increased over 180% between 1991 and 2002, from about $90,000 to 
about $256,000.275  However, it should be obvious that a cap will 
not effect a reduction in the median award until the median 
award becomes greater than the cap amount.  As the cap amount, 
adjusted for inflation, is currently $445,755, it would be 
impossible for the cap to reduce the median award of about 
$256,000.276  A cap has the effect of reducing only the awards 
                                                 
275 Martin D. Weiss et al., Medical Malpractice Caps: The 
Impact of Non-Economic Damage Caps on Physician Premiums, Claims 
Payout Levels, and Availability of Coverage 3 (Weiss Ratings, 
Inc. 
June 
2, 
2003) 
(available 
online 
at 
http://www.weissratings.com). 
276 The median award is very different from the mean award.  
In statistical parlance, the median refers to "the middle value 
in a distribution, above and below which lie an equal number of 
values."  Heritage Dictionary of the English Language 1120 (3d 
ed. 1992).  By contrast, the mean is what, in everyday language, 
one would call the "average value of a set of numbers."  Id. at 
1116.   
A simple example illustrates the point.  Consider five 
noneconomic damage awards, in the following amounts: $50,000, 
$100,000, $200,000, $350,000, and $20 million.  Consider further 
two states, one in which damages are uncapped and another in 
which noneconomic damages are capped at $350,000. 
No.  2003AP988.dtp 
 
22 
 
that are above the cap amount.  Accordingly, the amount of the 
median payout is simply irrelevant.   
¶258 Similarly, the majority cites a study from the General 
Accounting Office.  As it did with the report by the Wisconsin 
Commissioner of Insurance, the majority is forced to twist the 
GAO's blunt conclusion that malpractice claims tended to be 
lower and grew less rapidly in states with noneconomic damage 
caps.277  The majority's wordplay again reveals its disregard for 
any evidence supporting the legislature's action, in direct 
contradiction to hortatory statements elsewhere in the opinion. 
¶259 In 
summary, 
"[c]aps 
on 
awards . . . have 
had 
significant effects, in the direction and magnitude that is 
consistent with theory, prior evidence, and common sense."  
Patricia M. Danzon, The Effects of Tort Reforms on the Frequency 
and Severity of Medical Malpractice Claims, 48 Ohio St. L.J. 
413, 417 (1987) (emphasis added).  I agree with the Wisconsin 
Commissioner of Insurance and with the U.S. Department of Health 
and Human Services that the noneconomic damage cap helps control 
                                                                                                                                                             
In both states, the median of this set of data is the 
middle number, $200,000.  However, the mean of the data would be 
very different in the two states.  In the uncapped state, the 
mean of the data is $4.14 million.  In the capped state, the 
mean of the data is $210,000.  The majority notes that "a very 
small number of claims are . . . for an amount above the cap."  
Majority op., ¶126.  Thus, it is unremarkable that the cap has 
little if any effect on the median award.  The Weiss Report's 
conclusion that the median award value is unrelated to the caps 
is similarly unsurprising.  The Weiss Report apparently did not 
investigate the mean value of awards in capped versus uncapped 
states. 
277 Majority op., ¶124. 
No.  2003AP988.dtp 
 
23 
 
medical malpractice damage awards and creates a stable legal 
environment.278  Accordingly, I disagree with the majority that 
there is no rational connection between 1995 Act 10's enactment 
of a cap and the size of damage awards. 
2. 
The Cap Helps Reduce the Size of Malpractice Insurance 
Premiums 
 
¶260 The majority also questions whether the damage cap has 
actually reduced malpractice insurance premiums.  Majority op., 
¶¶121-29.  It trumpets a report by the GAO that multiple factors 
have contributed to increased malpractice insurance premiums.  
But even the GAO report concluded that "losses on medical 
malpractice claims——which make up the largest part of insurers' 
costs——appear to be the primary driver of rate increases in the 
long run."279  The Congressional Budget Office concluded that 
federal caps on damage awards, in combination with other tort 
reforms, would reduce malpractice insurance premiums by 25 to 30 
percent over the ten-year period between 2004 and 2013.280  
                                                 
278 See also Patricia M. Danzon, The Frequency and Severity 
of Medical Malpractice Claims: New Evidence, 49 Law & Contemp. 
Probs. 57, 76 (1986) (concluding that "[t]he average impact of 
the various statutes to cap all or part of the plaintiff's 
recovery has been to reduce average severity by twenty-three 
percent.").   
279 United 
States 
General 
Accounting 
Office, 
Medical 
Malpractice Insurance: Multiple Factors Have Contributed to 
Increased Premium Rates (GAO-03-702) at "Highlights" (June 
2003); see also id. at 43. 
280 U.S. 
Congress, 
Congressional 
Budget 
Office, 
Cost 
Estimate: H.R. 5 – Help Efficient, Accessible, Low-Cost, Timely 
Healthcare (HEALTH) Act of 2003 at 4 (Mar. 10, 2003). 
No.  2003AP988.dtp 
 
24 
 
 
¶261 The majority also attempts to disparage the Weiss 
report's conclusion that Wisconsin insurance premiums dropped by 
5% during 1991-2002.281  In that same eleven-year period, the 
median malpractice premiums rose between 35 and 50 percent in 
other states.282   
 
¶262 Undeniable statistical evidence reveals that increases 
in malpractice insurance premiums are far lower in Wisconsin 
than in states without caps.  For example, during the two-year 
period between 2001 and 2003, federal studies showed that the 
average highest premium283 increased 5% in Wisconsin.284  Over the 
same time period, the cost for the same type of insurance 
coverage increased 45% in states without caps.285  One study took 
care to note that this success in holding down premiums is "not 
accidental."286   
 
¶263 As of 2004, in 28 states, medical malpractice insurers 
reported a loss ratio above 100 percent; that is, for each 
                                                 
281 Martin D. Weiss et al., Medical Malpractice Caps: The 
Impact of Non-Economic Damage Caps on Physician Premiums, Claims 
Payout Levels, and Availability of Coverage 16 (Weiss Ratings, 
Inc. June 2, 2003) (available at http://www.weissratings.com). 
282 Id. at 16-17. 
283 Typically, the "average highest premium" refers to the 
highest premium increase 
among internal medicine, general 
surgery or obstetrics/gynecology specialists.  United States 
Department of Health & Human Services, Addressing the New Health 
Care Crisis at 23. 
284 Id. 
285 Id. 
286 Id. at 24. 
No.  2003AP988.dtp 
 
25 
 
premium dollar received, more than one dollar is expected to be 
paid out.287  As of 2001, medical malpractice insurers nationally 
paid out $1.53 in claims and expenses for each $1 in premiums 
collected.288  On the other hand, Wisconsin reported the lowest 
ratio, 61.71 percent, of all reporting jurisdictions.289   
 
¶264 Yet 
another 
recent 
empirical 
study 
showed 
that 
malpractice "[p]remiums in states with a cap on awards were 17.1 
percent lower than in states without such caps."290   
 
¶265 The 
majority 
simply 
chooses 
to 
disbelieve 
this 
evidence, claiming that "differences in both premiums and claims 
payments are affected by multiple factors in addition to damage 
caps, 
including 
state 
premium 
rate 
regulation, 
level 
of 
competition among insurers, and interest rates and income 
returns that affect insurers' investment returns."  Majority 
op., ¶125. 
 
¶266 The majority questions whether the crisis is real.  
See majority op., ¶160 n. 213.  Consider this: St. Paul, for 
many years the number one medical malpractice insurer in the 
nation, announced in 2001 that it would completely abandon 
providing medical malpractice insurance because it was no longer 
                                                 
287 Joint 
Committee 
on 
Finance, 
Injured 
Patients 
and 
Families Compensation Fund, Paper #450, at 7 (May 17, 2005). 
288 Gunnar, supra n.9, at 482. 
289 Joint 
Committee 
on 
Finance, 
Injured 
Patients 
and 
Families Compensation Fund, Paper #450, at 7 (May 17, 2005).   
290 Kenneth E. Thorpe, The Medical Malpractice 'Crisis': 
Recent Trends and the Impact of State Tort Reforms, Health 
Affairs 
at 
W4-26 
(Jan. 
21, 
2004) 
(at 
http://content.healthaffairs.org/cgi/reprint/hlthaff.w4.20v1). 
No.  2003AP988.dtp 
 
26 
 
profitable.  In an unrelated section of the majority opinion, 
the majority notes that St. Paul provided only 3.3% of 
malpractice insurance in Pennsylvania.  Majority op., ¶167 n. 
222.  Nationally, though, St. Paul "was the largest malpractice 
carrier in the United States, covering 9% of all doctors."291   
 
¶267 However, even the studies the majority cites recognize 
that while there are several factors driving up the cost of 
insurance 
premiums, 
malpractice 
awards 
are 
one 
of 
those 
factors.292  
¶268 For example, the GAO report conclusively showed that 
during 2001-02, states with caps experienced an average premium 
rate increase of 10%, as compared with a 29% increase for states 
without caps over the same period.293   
¶269 As the majority admits, the Wisconsin Commissioner of 
Insurance is in accord: "rate stability could be dramatically 
impacted for both the Fund and primary carriers should the caps 
be removed and insurers face unlimited non-economic damages."294 
                                                 
291 U.S. Department of Health & Human Services, Confronting 
the New Health Care Crisis: Improving Health Care Quality and 
Lowering Costs By Fixing Our Medical Liability System at 14 
(Jul. 24, 2002). 
292 See Health Insurance Association of America, Issue 
Brief: Why Do Health Insurance Premiums Rise at 13 (Sept. 2002). 
293 United States General Accounting Office, Pub. No. GAO-
03-836, Medical Malpractice: Implications of Rising Premiums on 
Access 
to 
Health 
Care 
31-32 
(Aug. 
2003) 
(available 
at 
www.gao.gov/new.items/d03836.pdf).   
294 Majority op., ¶122 (citing Report on the Impact of 1995 
Wisconsin Act 10). 
No.  2003AP988.dtp 
 
27 
 
¶270 The 
majority's 
rejection 
of 
such 
straightforward 
statements and evidence provides further proof of its complete 
abandonment of the standard of review.  As in other parts of its 
opinion, instead of searching for or constructing a rationale to 
support the legislature's action, the majority takes it upon 
itself to weigh competing evidence and decides the matter as if 
it were deciding a case on de novo review. 
 
¶271 This court used to summarize the appropriate standard 
of review as follows: "'Judicial response to a challenged 
legislative classification requires only that the reviewing 
court locate some reasonable basis for the classification 
made.'"  Sambs, 97 Wis. 2d at 371 (emphasis added) (citation 
omitted).  Now, instead of attempting to locate a rationale to 
support the caps, the majority searches for studies to discredit 
them.   
¶272 The legislature had a rational basis to find that the 
noneconomic damage cap assists in reducing medical malpractice 
insurance premiums.   
C. 
The Cap Protects the Fund's Financial Status and Keeps the 
Annual Provider Assessments to a Reasonable Level 
 
¶273 The majority's third legislative objective should also 
be separated into two component objectives: preserving the 
Fund's financial status and keeping annual provider assessments 
to a reasonable level.  On both grounds, the legislature had a 
rational basis to conclude that the noneconomic damage cap 
serves the intended purposes. 
 
No.  2003AP988.dtp 
 
28 
 
1. 
The Cap Protects the Fund's Financial Status 
 
¶274 In 
December 
1994, 
the 
nonpartisan 
Wisconsin 
Legislative 
Audit 
Bureau 
compiled 
an 
accounting 
estimate 
revealing that the Fund was in dire economic straits.295  The 
Fund had an accounting deficit of $67.9 million.296  As the 
majority notes, this deficit dated from the Fund's "first 10 
years of operation."  Majority op., ¶150 n.195.  "For a number 
of years, the Board ha[d] been studying ways to . . . retire its 
financial deficit."297 
 
¶275 The Office of the Commissioner of Insurance prepared a 
fiscal estimate in connection with 1995 Assembly Bill 36, and 
concluded as follows: 
In evaluating the fiscal impact of 1995 AB 35,298 OCI 
concentrated on its effect on the Fund.   . . .  
. . . .  
 . . . If a cap had been in place as of June 30, 1994, 
the break-even Fund levels could have been reduced by 
19.0% or approximately $10.5 million.  Over a five-
year period the total cumulative savings resulting 
                                                 
295 Wisconsin 
Legislative 
Audit 
Bureau, 
Audit 
Summary: 
Patients Compensation Fund, Document 94-29, at 1 (Dec. 1994). 
296 Id.; see also majority op., ¶150 n.195.   
297 Testimony of Peter Farrow, Executive Assistant to the 
Commissioner of Insurance, before the Assembly Committee on 
Insurance, Securities, and Corporate Policy, at 1 (Jan. 19, 
1995). 
298 The 
reference 
to 
"1995 
A.B. 
35" 
is 
an 
obvious 
typographical error logically intended to reference 1995 A.B. 
36.  1995 A.B. 35 concerned substitution of judges in criminal 
cases, and was never passed.   
No.  2003AP988.dtp 
 
29 
 
from a cap of $250,000 enacted June 30, 1994, is 
projected to be $67.8 million.299 
 
¶276 Later, as the majority notes, the bill was revised to 
reflect an increased cap of $350,000.  A revised fiscal estimate 
was never done.  Cumulative savings may have been used simply to 
reduce provider assessments.  In retrospect, though, is it 
merely a fascinating coincidence that the Fund had a deficit of 
$67.9 million, and the Commissioner of Insurance estimated the 
five-year savings to the Fund at $67.8 million?   
 
¶277 It is interesting to examine the Fund's deficit 
through the past twenty years, keeping in mind that the effects 
of tort reform often take three to five years to become 
apparent,300 probably because of the lag time between enactment 
and the filing of claims based on events that occurred after 
enactment.  With that in mind, consider the following data and 
commentary: 
 
 
                                                 
299 Fiscal estimate for 1995 A.B. 36. 
300 Daniel Kessler and Mark McClellan, Do Doctors Practice 
Defensive Medicine?, 111 Quarterly J. of Econ. 353, 386 (1996). 
No.  2003AP988.dtp 
 
30 
 
Year  
 
 
 
Surplus (Deficit)301 
1980-1981  
 
 
 
(8,000,000)* 
1981-1982  
 
 
 
(9,000,000)* 
1982-1983  
 
 
 
(20,000,000)* 
1983-1984  
 
 
 
(50,000,000)* 
1984-1985  
 
 
 
(80,000,000)* 
Prior to 1985, no cap on noneconomic damages existed.  1985 Act 
340 capped noneconomic damages at $1,000,000. 
1985-86 
 
 
 
 
(100,000,000)* 
1986-87 
 
 
 
 
(112,000,000)* 
1987-88 
 
 
 
 
(122,700,000) 
Three years after 1985 Act 340 became law, the Fund's deficit 
began to decrease. 
1988-89 
 
 
 
 
(108,300,000)* 
1989-90 
 
 
 
 
(73,597,992) 
1990-91 
 
 
 
 
(71,679,588) 
In 1991 the damage caps enacted in 1985 Act 340 were "sunset," 
meaning that no cap existed. 
1991-92 
 
 
 
 
(78,982,681) 
                                                 
301 Figures marked with * are estimated from graphical data.  
See Wisconsin Legislative Audit Bureau, An Audit of Patients 
Compensation Fund, Document 94-29 7-8 (Dec. 1994) (Figure 1).  
Deficits between FY 1989-90 and 1991-92 are taken from Wisconsin 
Legislative Audit Bureau, An Audit of Patients Compensation 
Fund, Document 93-18 10 (July 1993).  Deficits between FY 1992-
93 and 1993-94 are taken from Wisconsin Legislative Audit 
Bureau, An Audit of Patients Compensation Fund, Document 94-29 
18 (Dec. 1994).  Deficit and surplus amounts between 1994-95 and 
2001-02 are taken from Legislative Fiscal Bureau, Paper #458: 
Patients Compensation Fund 7 (Apr. 23, 2003).  The 2003-04 value 
is drawn from Wisconsin Legislative Audit Bureau, An Audit: 
Injured Patients and Families Compensation Fund 37 (Oct. 2004). 
No.  2003AP988.dtp 
 
31 
 
1992-93 
 
 
 
 
(71,613,641) 
1993-94 
 
 
 
 
(67,903,761) 
1994-95 
 
 
 
 
(57,722,800) 
In 1994 the legislature studied whether to reenact caps.  1995 
Act 10, reenacting caps, became law in May 1995. 
1995-96 
 
 
 
 
(41,795,500) 
1996-97 
 
 
 
 
(44,094,200) 
1997-98 
 
 
 
 
(22,166,700) 
Three years after the passage of 1995 Act 10, the Fund's 
fortunes dramatically improved, and it began to show an 
accounting surplus for the first time. 
1998-99 
 
 
 
 
8,579,800 
1999-00 
 
 
 
 
27,229,700 
2000-01 
 
 
 
 
28,460,500 
2001-02 
 
 
 
 
6,604,100 
2002-03 
 
 
 
 
7,935,026 
 
¶278 The majority relies on its expertise in accounting to 
conduct a detailed fiscal analysis302 and then declares 
The Fund has flourished both with and without a cap.  
If the amount of the cap did not impact the Fund's 
fiscal stability and cash flow in any appreciable 
manner when no caps existed or when a $1,000,000 cap 
existed, then the rational basis standard requires 
more to justify the $350,000 cap as rationally related 
to the Fund's fiscal condition. 
Majority op., ¶158.   
                                                 
302 Majority op., ¶¶130-58. 
No.  2003AP988.dtp 
 
32 
 
¶279 This analysis, while admittedly an inexact science, 
shows that the caps do have an impact on the Fund's fiscal 
stability.  Recent estimates confirm this analysis. 
 
¶280 On May 17, 2005, the Legislative Fiscal Bureau 
released Paper #450, relating to the Patients Compensation Fund.  
The paper notes that this court upheld the cap on noneconomic 
damages in wrongful death cases, and had accepted review in the 
case at bar.  The study notes that, according to actuarial 
estimates, "if Wisconsin's cap on noneconomic damages were to be 
declared unconstitutional, the potential fund liabilities may be 
increased by an estimated $150 million to $200 million."303 
 
¶281 In 2001, the nonpartisan Legislative Audit Bureau 
reached the same findings: "Action by the Board of Governors and 
the 
Legislature . . . have 
contributed 
to 
a 
significant 
improvement in the Fund's financial position, which showed an 
accounting surplus of $27.2 million as of June 30, 2000."304  The 
2001 study specifically cited the legislature's re-establishment 
of a limit on awards for non-economic damages in 1995 as one of 
the reasons behind the Fund's stabilization.305 
 
¶282 The nonpartisan study provided concrete evidence for 
this finding: "the Fund's claim payments were below $20 million 
                                                 
303 Legislative Fiscal Bureau, Paper #450: Injured Patients 
and Families Compensation Fund 8 (May 17, 2005).   
304 Letter from Janice Mueller, State Auditor, to Senator 
Gary George and Representative Joseph Leibham, Co-chairpersons, 
Legislative Audit Committee (June 5, 2001). 
305 Legislative 
Audit 
Bureau, 
An 
Audit: 
Patients 
Compensation Fund 11 (June 2001). 
No.  2003AP988.dtp 
 
33 
 
in each year from FY 1997-98 through FY 1999-2000.  In contrast, 
a number of recent medical malpractice cases in other states 
have resulted in verdicts of more than $30 million, including a 
$79 million verdict in New York, a $55 million verdict in 
Illinois, and a $40 million verdict in Texas."306  In other 
words, thanks to the majority's action today, the Fund may be 
held liable for an award in a single case that dwarfs the Fund's 
current yearly expenditures.  It is impossible to conceive that 
this would not have a deleterious effect on the Fund.   
 
¶283 The majority ignores this evidence.  The legislature 
had a rational basis to believe that the cap would increase the 
financial stability of the fund.   
2. 
The Cap Allows the Fund to Keep Provider Assessments to a 
Reasonable Level 
 
¶284 The damage cap has also allowed the Fund to keep 
provider assessments low.  Between fiscal year 1995-96 and 
fiscal year 2001-02, the Fund increased assessments only once.307 
In another year, there was no change in assessments.  In the 
remaining five years, assessments decreased.308   
 
¶285 The 
majority 
plainly 
states 
that 
one 
of 
the 
legislative objectives was to keep provider assessments to a 
minimum.  After examining the data, despite its best efforts the 
majority is powerless to conclude that this objective has not 
been met.  Accordingly, as the data do not support the answer 
                                                 
306 Id. at 12. 
307 Id. at 15. 
308 Id. 
No.  2003AP988.dtp 
 
34 
 
the majority sought, the majority simply recasts the inquiry: 
"In any event, as we explain below, a reduction in the 
assessments is not necessarily germane to the legislative 
objectives . . . ."  Majority op., ¶154.  How can the majority 
make this claim after stating earlier in the opinion that 
keeping assessments low was itself one of the legislative 
objectives? 
¶286 From an accounting perspective, it should be clear 
that the level of the assessments is tied in some way to the 
financial health of the Fund.  As the Fund's stability and 
assets increase, the assessments will go down.  As already 
noted, the majority's removal of the cap will decrease the 
economic health of the Fund, and likely increase the provider 
assessments.   
D. 
The Cap Reduces the Overall Cost of Health Care 
 
¶287 The majority opinion does not allege that noneconomic 
damage caps do not reduce the cost of health care.  Rather, the 
majority concentrates on the fact that "medical malpractice 
insurance premiums are an exceedingly small portion of overall 
health care costs."  Majority op., ¶162.  The majority equates 
small percentages with small costs.  
 
¶288 A multitude of studies and statistics belie the 
majority's conclusion.  First, a May 2003 study by the Joint 
Economic Committee of the United States Congress concluded that 
medical malpractice reform could produce $12.1 billion to $19.5 
billion in annual savings for the federal government, and, by 
decreasing costs, increase the number of Americans with health 
No.  2003AP988.dtp 
 
35 
 
insurance coverage by as many as 3.9 million people.309  Another 
study estimated that the savings from national reform would be 
$70 to $126 billion dollars per year.310 
 
¶289 The Congressional Budget Office has estimated that 
malpractice reforms, including the imposition of caps on 
noneconomic damages, would result in a 0.4 percent decrease in 
the price of health insurance.311  Nationwide, this would mean 
that an additional 385,000 Americans could obtain health 
insurance.312 
 
¶290 While these figures may represent a small percentage 
of total health care costs or the total number of Americans, 
they are not inconsequential.  There is no reason to believe 
that these findings are not also applicable, on a smaller scale, 
in Wisconsin.  The legislature had a rational basis to believe 
that the imposition of damage caps would reduce overall health 
care costs and increase the availability of health insurance. 
E. 
The Cap Encourages Providers to Stay in Wisconsin and 
Reduces the Practice of Defensive Medicine 
 
¶291 The majority concludes that the existence of the cap 
does not encourage providers to stay in Wisconsin, nor does it 
                                                 
309 United 
States 
Congress 
Joint 
Economic 
Committee, 
Liability for Medical Malpractice at 1. 
310 United States Department of Health & Human Services, 
Addressing the New Health Care Crisis at 11. 
311 U.S. Congress, Joint Economic Committee, Liability for 
Medical Malpractice at 22.   
312 Id. 
No.  2003AP988.dtp 
 
36 
 
reduce the practice of defensive medicine.  I disagree on both 
counts. 
1. 
The Cap Encourages Health Care Providers to Remain in 
Wisconsin 
 
¶292 In one term, this court has transformed the medical 
malpractice climate in this state.  In Lagerstrom v. Myrtle 
Werth Hospital, 2005 WI 124, ___ Wis. 2d ___, ___ N.W.2d ___, 
the court eviscerated the statute modifying the collateral 
source rule in medical malpractice actions.  In Phelps, the 
court held that medical residents are not health care providers 
covered by Chapter 655.  And today, the majority delivers its 
masterstroke——the abolition of the statutory cap on noneconomic 
damages. 
 
¶293 The majority dismisses any potential consequences, 
citing a GAO study's tentative conclusion that, "doctors do not 
appear to leave or enter states to practice based on caps on 
noneconomic damages . . . ."  Majority op., ¶168.  However, the 
GAO study included limited data from only five states.313  The 
majority claims that these conclusions "are supported by other 
reports and studies."  Majority op., ¶169.  This is simply 
incorrect.   
¶294 The majority cites three other "studies."  The first 
is a student-written comment.314  Far from supporting the 
                                                 
313 U.S. General Accounting Office, Medical Malpractice: 
Implications of Rising Premiums on Access to Health Care, GAO03-
836 17 (August 2003) (available at http://www.gao.gov). 
314 Lauren Elizabeth Rallo, Comment, The Medical Malpractice 
Crisis——Who Will Deliver the Babies of Today, the Leaders of 
Tomorrow?, 20 J. Contemp. Heath L. & Pol'y 509 (2004). 
No.  2003AP988.dtp 
 
37 
 
majority's mistaken premise, this article relates anecdotal 
evidence 
of 
physician 
migration 
from 
states 
without 
a 
noneconomic damage cap.315  The majority latches on to the 
article's recognition that the AMA has not declared Wisconsin a 
"problem" state, majority op., ¶169 n.227, but the majority 
misses the point.  Wisconsin is not in a medical malpractice 
crisis because the legislature has addressed it through tort 
reform.  By undoing the work of the legislature, the majority 
will drag Wisconsin back into the crisis.  It is disingenuous to 
claim that Wisconsin is not experiencing a physician migration 
problem and use that as a reason to get rid of the cap, when the 
cap is one reason that Wisconsin has no migration problem at 
this time. 
 
¶295 Another article cited by the majority cites the GAO 
study already discussed, as well as several newspaper articles, 
but adds no independent research to the question.316 
 
¶296 The third article the majority cites is a policy paper 
presented to the Illinois State Bar Association and later the 
Illinois General Assembly.317  The Illinois legislators obviously 
were not convinced by the assertions in the study——they enacted 
                                                 
315 Id. at 510-11. 
316 Geoff 
Boehm, 
Debunking 
Medical 
Malpractice 
Myths: 
Unraveling the False Premises Behind "Tort Reform", 5 Yale J. 
Health Pol'y, L. & Ethics 357, 360-61 & n.17. 
317 Majority op., ¶170 n.229 (citing Neil Vidmar, Medical 
Malpractice and the Tort System in Illinois: A Report to the 
Illinois State Bar Association, 73-82 (May 2005). 
No.  2003AP988.dtp 
 
38 
 
a $500,000 cap on noneconomic damages in medical malpractice 
actions shortly thereafter.318 
 
¶297 Only one study has comprehensively surveyed this 
question.  In 2003, the U.S. Department of Health & Human 
Services commissioned a study that evaluated data from 49 states 
over an extended time period.319  This study concluded that 
"States with a cap average 24 more physicians per 100,000 
residents than States without a cap.  Thus, States with caps 
have about 12 percent more physicians per capita than States 
without a cap."320 
 
¶298 This effect is even more pronounced in Wisconsin.  The 
same study evaluated the supply of physicians in Wisconsin over 
the years 1970-2000, and found that the physician population 
increased by 104.5% over that time span.321  Meanwhile, the 
average supply in states without caps increased by only 79.1%——a 
difference of over 25%.322 
 
¶299 Similarly, in Wisconsin, the Commissioner of Insurance 
reported increases in the number of physicians in Wisconsin in 
2005.  This conclusion forces the majority to explain away yet 
more evidence of the positive effects of the cap; according to 
                                                 
318 Dave McKinney, Chris Fusco, et al., Medical Malpractice 
Caps Cleared, Chicago Sun-Times (May 26, 2005). 
319 United States Dep't of Health & Human Servs., The Impact 
of State Laws Limiting Malpractice Awards on the Geographic 
Distribution of Physicians (Jul. 3, 2003). 
320 Id. 
321 Id. 
322 Id. 
No.  2003AP988.dtp 
 
39 
 
the majority, the report is unreliable because the Commissioner 
did not expressly conclude that the positive effect was the 
result of the noneconomic damage cap.  Once again, the majority 
doesn't let hard evidence get in the way of its preordained 
conclusion. 
¶300 Yet 
another 
study, 
after 
evaluating 
substantial 
statistical data spanning 1980-1998, confirmed that "enacting 
caps on non-economic damages is an effective way to attract and 
retain physicians."323  The study went one step further, 
establishing that the increased number of physicians translated 
to increased availability of health care in some regions, 
statistically reducing infant mortality rates among African-
American babies by 67 deaths per 100,000 births.324 
 
¶301 A small dose of common sense compels the conclusion 
that doctors would prefer to practice medicine in a favorable 
legal environment.  The quoted surveys confirm this notion.  
Accordingly, the legislature had a rational basis to conclude 
that the cap on noneconomic damages would encourage physicians 
to remain in——or move into——Wisconsin. 
2. 
The Cap Reduces the Practice of Defensive Medicine 
                                                 
323 Jonathan 
Klick 
& 
Thomas 
Stratmann, 
Does 
Medical 
Malpractice Reform Help States Retain Physicians and Does It 
Matter? 12-13 (Oct. 2, 2003) (unpublished manuscript, available 
at 
http://papers.ssrn.com/sol3/papers.cfm?abstract_id=453481).  
The study concluded "The effect of caps on non-economic damages 
in general and those set at $500,000 is positive on the number 
of 
doctors 
per 
capita, 
and 
the 
result 
is 
statistically 
significant."  Id. at 9 (emphasis added).  The noneconomic 
damage cap in Wis. Stat. § 893.55(4)(d), adjusted for inflation, 
is currently $445,775. 
324 Id. at 13-14.   
No.  2003AP988.dtp 
 
40 
 
 
¶302 The issue of whether doctors are less likely to 
practice defensive medicine is related to medical migration.  
Majority op., ¶172.  The majority admits that "an 'accurate 
measurement of the extent of this phenomenon is virtually 
impossible,'" 
then 
holds 
this 
difficulty 
against 
the 
legislature.  Id., ¶173. 
 
¶303 The majority cites three studies, all concluding that 
defensive medicine is difficult to measure because "[f]indings 
about defensive medicine must be based on surveys of health care 
providers . . . ."  Majority op., ¶174. 
 
¶304 It is true that physician surveys provide ample 
evidence of the existence of the practice of defensive medicine.  
However, the majority's assertion that such surveys are the only 
evidence of the practice is simply not correct.  On the 
contrary, "[a] large body of research has accumulated showing 
that medical malpractice liability causes doctors to practice 
defensive medicine."325  Of course, the majority repudiates or 
ignores physician surveys attesting to the fact that "more than 
three out of four (76 percent) doctors report that they practice 
defensive medicine."326  However, scientific studies arrive at 
the same conclusion. 
¶305 In 1996, a study jointly undertaken by Stanford 
University and the National Bureau on Economic Research employed 
mathematical models and statistical research over the years 
                                                 
325 U.S. Congress, Joint Economic Committee, Liability for 
Medical Malpractice at 13 (collecting studies).  
326 Id.  See also Gunnar, supra n.9, at 495. 
No.  2003AP988.dtp 
 
41 
 
1984-1990 to study the effect of medical malpractice reform——
particularly 
noneconomic 
damage 
caps——on 
the 
practice 
of 
defensive medicine.  Daniel Kessler and Mark McClellan, Do 
Doctors Practice Defensive Medicine?, 111 Quarterly J. of Econ. 
353 (1996).  The conclusion:  "Our analysis indicates that 
reforms 
that 
directly 
limit 
liability——caps 
on 
damage 
awards,[327] abolition of punitive damages,[328] abolition of 
mandatory 
prejudgment 
interest, 
and 
collateral-source-rule 
reforms[329]——reduce hospital expenditures by 5 to 9 percent 
within three to five years of adoption, with the full effects of 
reforms requiring several years to appear."  Id. at 386.330  The 
study further found that  
if reforms directly limiting malpractice liability had 
been applied throughout the United States [between 
1984 and 1990] expenditures on cardiac disease would 
have been around $450 million per year lower for each 
of the first two years after adoption and close to 
$600 million per year lower for each of years three 
                                                 
327 See 
Wis. Stat. § 893.55(4)(d) 
(today 
declared 
unconstitutional by the majority). 
328 See 
Wis. Stat. § 893.55(5); 
Lund 
v. 
Kokemoor, 
195 
Wis. 2d 727, 734, 537 N.W.2d 21 (Ct. App. 1995).   
329 See Wis. Stat. § 893.55(7) (eviscerated by the majority 
in Lagerstrom v. Myrtle Werth Hospital, 2005 WI 124, ___ 
Wis. 2d ___, ___ N.W.2d ___). 
330 The GAO study cited by the majority did not dispute 
these conclusions, but commented that "the savings cannot be 
generalized 
across 
all 
services, 
populations, 
and 
health 
conditions."  United States General Accounting Office, Pub. No. 
GAO-03-836, Medical Malpractice: Implications of Rising Premiums 
on Access to Health Care, GAO-03-836, at 30 (2003).  Aside from 
that conclusory comment, the GAO did not give any statistical 
reason that the study's findings would not be more widely 
applicable. 
No.  2003AP988.dtp 
 
42 
 
through five after adoption, compared with nonadoption 
of direct reforms.   
Id. at 387.   
¶306 Another recent study concluded that tort reform, 
including the imposition of damage caps, would result in 
"between $9.3 billion and $16.7 billion in additional budgetary 
savings in 2013 from reduced defensive medicine."331  The Joint 
Economic Committee estimates that the reduced cost of health 
insurance resulting from the reduction in defensive medicine 
practices would contribute to allowing an additional 1.6 million 
to 2.6 million Americans to afford health insurance.332 
¶307 Similar studies are in accord.333 
 
¶308 These conclusions, based on statistical analysis, 
obliterate the majority's vague assertions that the effects of 
defensive medicine either cannot be measured or do not affect 
health care costs.  Majority op., ¶174.  The legislature 
unquestionably had a rational basis to conclude that its 
enactment of the noneconomic damage cap would both keep 
physicians in Wisconsin and reduce the practice of defensive 
medicine.   
 
                                                 
331 U.S. Congress, Joint Economic Committee, Liability for 
Medical Malpractice: Issues and Evidence at 21. 
332 Id. at 23. 
333  U.S. Department of Health & Human Services, Confronting 
the New Health Care Crisis: Improving Health Care Quality and 
Lowering Costs By Fixing Our Medical Liability System 7 (Jul. 
24, 2002) ("If reasonable limits were placed on non-economic 
damages to reduce defensive medicine, it would reduce the amount 
of taxpayers' money the Federal Government spends by $25.3-44.3 
billion per year."). 
No.  2003AP988.dtp 
 
43 
 
DECISIONS BY OTHER COURTS 
 
¶309 No other court evaluating a cap on noneconomic damages 
in medical malpractice cases has considered (or at least has not 
cited) the amount of statistical data and evidence this court 
has cited in this case.  On more limited data, some courts have 
struck down caps on noneconomic damages in medical malpractice 
cases.  Others have upheld them.  In my view, the better 
reasoning has been put forth in the cases upholding caps. 
 
¶310 Given the standard of review, which it faithfully 
claims is the "rational basis" test, the majority should not be 
able 
to 
ignore 
the 
mountain 
of 
evidence 
supporting 
the 
effectiveness of caps.  The length of the majority opinion 
illustrates just how hard the majority has to work to discredit 
study after study, fact after fact, fighting its way to the 
desired result.  Other courts' decisions show the error in the 
majority's ways. 
¶311 California was one of the first states to enact 
medical malpractice tort reform.  In 1975 its legislature 
enacted the Medical Injury Compensation Reform Act (MICRA) 
which, among other reforms, limited noneconomic damages in 
medical malpractice cases to $250,000.  See Fein v. Permanente 
Med. Group, 695 P.2d 665 (Cal. 1985).  The constitutionality of 
various aspects of MICRA has been challenged.  In Fein, the 
plaintiff challenged the noneconomic damage cap on an equal 
protection theory, placing that case on equal footing with this 
one.  Faced with the identical issue we face, the California 
court responded: 
No.  2003AP988.dtp 
 
44 
 
We have . . . found that the statutory classifications 
are 
rationally 
related 
to 
the 
"realistically 
conceivable legislative purpose[s]" of MICRA.  We have 
not invented fictitious purposes that could not have 
been within the contemplation of the Legislature nor 
ignored the disparity in treatment which the statute 
in realistic terms imposes.  But [prior cases] have 
never been interpreted to mean that we may properly 
strike down a statute simply because we disagree with 
the wisdom of the law or because we believe that there 
is a fairer method for dealing with the problem.  Our 
recent decisions do not reflect our support for the 
challenged provisions of MICRA as a matter of policy, 
but simply our conclusion that under established 
constitutional principles the Legislature had the 
authority to adopt such measures.   . . . "[A] court 
cannot eliminate measures which do not happen to suit 
its tastes if it seeks to maintain a democratic 
system.  The forum for the correction of ill-
considered legislation is a responsive legislature." 
Fein, 695 P.2d at 684 (emphasis added) (internal citations 
omitted).334 
¶312 Many other courts have reached the same conclusion.335  
In 2003 the Nebraska Supreme Court, faced with a cap on total 
damages, summarized the current state of the law: 
                                                 
334 The United States Supreme Court dismissed an appeal for 
want of a federal question.  Fein v. Permanente Med. Group, 474 
U.S. 892 (1985) (mem.).   
No.  2003AP988.dtp 
 
45 
 
A majority of jurisdictions apply a rational basis or 
other similar test and determine that a statutory cap 
on damages does not violate equal protection. See, 
e.g., Phillips v. Mirac, Inc., 251 Mich. App. 586, 651 
N.W.2d 437 (2002); Guzman v. St. Francis Hospital, 
Inc., 240 Wis.2d 559, 623 N.W.2d 776 (Wis. App. 2000); 
Scholz v. Metropolitan Pathologists, P.C., 851 P.2d 
901 (Colo. 1993) (en banc); Murphy v. Edmonds, 325 Md. 
342, 601 A.2d 102 (1992); Adams v. Children's Mercy 
Hosp., 832 S.W.2d 898 (Mo. 1992) (en banc); Butler v. 
Flint Goodrich Hosp., 607 So.2d 517 (La. 1992); Peters 
v. 
Saft, 
597 
A.2d 
50 
(Me. 
1991); 
Robinson 
v. 
Charleston Area Med. Center, 186 W.Va. 720, 414 S.E.2d 
877 (1991); Fein v. Permanente Medical Group, 38 
Cal.3d 137, 695 P.2d 665, 211 Cal. Rptr. 368 (1985); 
Etheridge v. Medical Center Hospitals, 237 Va. 87, 376 
S.E.2d 525 (1989); Johnson v. St. Vincent's Hospital, 
273 Ind. 374, 404 N.E.2d 585 (1980), abrogated on 
other grounds, Collins v. Day, 644 N.E.2d 72 (Ind. 
1994). See, also, Evans ex rel. Kutch v. State, 56 
                                                                                                                                                             
335 See, e.g., Davis v. Omitowoju, 883 F.2d 1155, 1158-59 
(3d Cir. 1989); Boyd v. Bulala, 877 F.2d 1191, 1196-97 (4th Cir. 
1989) ("the cap on liability bears a reasonable relation to a 
valid legislative purpose——the maintenance of adequate health 
care services in the Commonwealth of Virginia"); Evans ex rel. 
Kutch v. State, 56 P.3d 1046, 1054 (Alaska 2002) ("the nexus 
between the legislative objectives and the damage caps is 
adequate"); Garhard v. Columbia/Healthtone, L.L.C., 95 P.3d 571, 
575 (Colo. 2004); Univ. of Miami v. Echarte, 618 So. 2d 189, 191 
(Fla. 
1993) 
(extensively 
discussing 
Florida's 
medical 
malpractice crisis); Murphy v. Edmonds, 601 A.2d 102, 115-16 
(Md. 1992); Zdrojewski v. Murphy, 657 N.W.2d 721, 737-39 (Mich. 
Ct. App. 2003); Adams v. Childrens Mercy Hosp., 832 S.W.2d 898, 
904-05 (Mo. 1992); Gourley ex rel. Gourley v. Neb. Methodist 
Health Sys., Inc., 663 N.W.2d 43 (Neb. 1998); Rose v. Doctors 
Hosp. Facilities, 735 S.W.2d 244, 253-54 (Tex. App. 1987); 
Etheridge v. Med. Ctr. Hosps., 376 S.E.2d 525, 534 (Va. 1989) 
(noneconomic damage cap passes "rational basis" test, and 
therefore does not violate equal protection); Judd v. Drezga, 
103 P.3d 135, 141-43 (Utah 2004); Robinson v. Charleston Area 
Med. Ctr., 414 S.E.2d 877, 886-87 (W. Va. 1991). 
Still other courts have concluded that noneconomic damage 
caps in other, non-medical malpractice settings, do not violate 
constitutional guarantees including equal protection.  See, 
e.g., Phillips v. Mirac, Inc., 685 N.W.2d 174, 186 (Mich. 2004); 
Meech v. Hillhaven West, Inc., 776 P.2d 488, 504 (Mont. 1989). 
No.  2003AP988.dtp 
 
46 
 
P.3d 1046 (Alaska 2002) (reaching this conclusion but 
stating that it was not binding precedent); Trujillo 
v. City of Albuquerque, 125 N.M. 721, 965 P.2d 305 
(1998) (overruling use of heightened standard, but 
remanding for determination of constitutionality under 
rational basis standard); Morris v. Savoy, 61 Ohio 
St.3d 684, 576 N.E.2d 765 (1991) (finding no violation 
of 
equal 
protection, 
but 
finding 
damages 
cap 
unconstitutional on other grounds).  
Gourley ex rel. Gourley v. Nebraska Methodist Health Sys., Inc., 
663 N.W.2d 43, 70-71 (Neb. 2003) (emphasis added).   
¶313 After consulting legislative findings similar to those 
discussed in the majority opinion, the Gourley court resisted 
the plaintiff's invitation to "second guess the conclusions of 
the Legislature" by deciding that the Nebraska damage cap was 
"unwise or unnecessary."  Id. at 72.  Instead, it concluded that 
"[r]educing health care costs and encouraging the provision of 
medical services are legitimate goals which can reasonably be 
thought to be furthered by lowering the amount of medical 
malpractice judgments."  Id.     
SUMMATION 
¶314 In 1995 the legislature approved comprehensive medical 
malpractice reform.  Over the past decade it has been very 
successful.  Upon reviewing validly enacted legislative acts, 
the court is supposed to recognize that it is the legislature's 
function, not the court's, to evaluate studies and reports.  The 
court should not second guess the legislature.   
¶315 The majority obviously disagrees.   
No.  2003AP988.dtp 
 
47 
 
¶316 Nevertheless, in its closing paragraphs the majority 
states, "The court must presume that the legislature's judgment 
was sound and look for support for the legislative act."336   
 
¶317 The majority also pledges its adherence "to the 
concept of judicial restraint that cautions against substituting 
judicial opinions for the will of the legislature . . . ."337 
 
¶318 The changes wrought by the majority opinion will be 
profound, but it is these concluding passages that hurt the 
most. 
 
¶319 I am authorized to state that Justices JON P. WILCOX 
and PATIENCE DRAKE ROGGENSACK join this dissent. 
 
 
 
 
                                                 
336 Majority op., ¶184. 
337 Majority op., ¶185. 
No.  2003AP988.pdr 
 
1 
 
¶320 PATIENCE 
DRAKE 
ROGGENSACK, 
J. 
(dissenting).   The 
majority opinion concludes that the legislature's establishment 
of the cap on noneconomic damages under Wis. Stat. § 655.017 
(2003-04)338 
and 
Wis. 
Stat. 
§ 893.55(4)(d)339 
is 
facially 
unconstitutional on equal protection grounds.  Majority op., 
¶10.  The two classes the majority opinion compares are those 
persons subjected to medical malpractice who were awarded 
noneconomic damages in excess of the cap and those who were 
awarded noneconomic damages less than the cap.  It then employs 
a new rational basis test, which it calls "rational basis with 
teeth, or meaningful rational basis," to conclude that the cap 
has no rational basis, in violation of the equal protection 
clause of Article I, Section 1 of the Wisconsin Constitution.  
Majority op., ¶80.  Because I conclude that Ferdon has not met 
his burden to prove that the cap required by Wis. Stat. 
§ 655.017 
is 
not 
rationally 
related 
to 
the 
legitimate 
legislative objectives of (1) reducing the size of medical 
malpractice judgments and settlements in order to tame the costs 
of medical malpractice insurance; and (2) to make the choice to 
continue as, or to become, a health care provider in Wisconsin 
desirable so that quality health care will continue to be 
readily available in Wisconsin; I respectfully dissent. 
 
                                                 
338 All further references to the Wisconsin Statutes are to 
the 2001-02 version, unless otherwise noted. 
339 The cap on noneconomic damages is indexed for inflation.  
As of June 16, 2005, the limit on those damages was $445,775.  
Ferdon received $410,322, the capped limit at that time. 
No.  2003AP988.pdr 
 
2 
 
I.  DISCUSSION 
A. 
Standard of Review 
¶321 Whether a statute is constitutional is a question of 
law that we decide de novo.  This case presents a facial 
challenge to the constitutionality of a statute and as such, we 
are asked to determine, independent of the particular facts of 
this case, whether the statute states an invalid rule of law.  
Dane County Dep't of Human Servs. v. P.P., 2005 WI 32, ¶67, ___ 
Wis. 2d ___, 694 N.W.2d 344 (Roggensack, J. concurring).   
B. 
Equal Protection 
¶322 A statute that is challenged on equal protection 
grounds is presumed to be constitutional.  Aicher v. Wis. 
Patients Comp. Fund, 2000 WI 98, ¶18, 237 Wis. 2d 99, 613 N.W.2d 
849; see also State v. Cole, 2003 WI 112, ¶11, 264 Wis. 2d 520, 
665 N.W.2d 328; Lounge Mgmt., Ltd. v. Town of Trenton, 219 
Wis. 2d 13, 20, 580 N.W.2d 156 (1998); State v. Konrath, 218 
Wis. 2d 290, 302, 577 N.W.2d 601 (1998).  This presumption is 
based on our respect for a co-equal branch of government and is 
meant to promote due deference to legislative acts.  Cole, 264 
Wis. 2d 520, ¶18.  "[E]very presumption must be indulged to 
sustain the law."  Jackson v. Benson, 218 Wis. 2d 835, 853, 578 
N.W.2d 602 (1998).  
¶323 We resolve any doubt about the constitutionality of a 
statute in favor of upholding its constitutionality.  Aicher, 
237 Wis. 2d 99, ¶18; see also Monroe County Dep't of Human 
Servs. v. Kelli B., 2004 WI 48, ¶16, 271 Wis. 2d 51, 678 N.W.2d 
831; Cole, 264 Wis. 2d 520, ¶11.  Further, in choosing between 
No.  2003AP988.pdr 
 
3 
 
reasonable interpretations of a statute, we "must select the 
construction [that] results in constitutionality."  Am. Family 
Mut. Ins. Co. v. DOR, 222 Wis. 2d 650, 667, 586 N.W.2d 872 
(1998) (quoting State ex rel. Strykowski v. Wilkie, 81 Wis. 2d 
491, 526, 261 N.W.2d 434 (1978)).  
¶324 It is insufficient for the party challenging the 
statute to establish either that the statute's constitutionality 
is doubtful or that the statute is probably unconstitutional.  
Cole, 264 Wis. 2d 520, ¶11; Jackson, 218 Wis. 2d at 853.  
Instead, the party challenging a statute's constitutionality 
must demonstrate that the statute is unconstitutional beyond a 
reasonable doubt.  Cole, 264 Wis. 2d 520, ¶11; Jackson, 218 
Wis. 2d at 853.  While this language implies the evidentiary 
burden of proof most commonly used for factual determinations in 
a criminal case, in this context, the phrase, "beyond a 
reasonable doubt," establishes the force or conviction with 
which a court must conclude, as a matter of law, that a statute 
is unconstitutional before the statute can be set aside.  See 
Guzman v. St. Francis Hosp., Inc., 2001 WI App 21, ¶4 n.3, 240 
Wis. 2d 559, 623 N.W.2d 776.   
¶325 The cap on noneconomic damages survives an equal-
protection challenge if "a rational basis exists to support the 
classification, unless the statute impinges on a fundamental 
right or creates a classification based on a suspect criterion."  
Id., 
¶19 
(citation 
omitted). 
 
Guzman 
examined 
the 
same 
classification described in the majority opinion under an equal 
protection 
challenge. 
 
Guzman 
explained 
that 
this 
court 
No.  2003AP988.pdr 
 
4 
 
previously had determined that the statutory scheme set out in 
chapter 655 did not involve a fundamental right or a suspect 
criterion.  Id., ¶20.  Therefore, the rational basis test 
provides the appropriate analysis for the cap on noneconomic 
damages.  Id. 
¶326 In Aicher, we explained the legislature's motivation 
in 
establishing 
a 
specific 
statutory 
scheme 
for 
medical 
malpractice actions.  We stated that the medical malpractice 
statutes were aimed at addressing: 
a sudden increase in the number of malpractice suits, 
in the size of awards, and in malpractice insurance 
premiums, and identified several impending dangers:  
increased health care costs, the prescription of 
elaborate 
"defensive" 
medical 
procedures, 
the 
unavailability of certain hazardous services and the 
possibility 
that 
physicians 
would 
curtail 
their 
practices. 
Aicher, 237 Wis. 2d 99, ¶22 (quoting Strykowski, 81 Wis. 2d at 
508).  Although Aicher involved the constitutional analysis of a 
statute of repose in regard to medical malpractice actions 
brought by children, we examined and approved the policy bases 
of the legislature for the comprehensive statutory scheme of 
which an action by a minor was a part.  We explained that 
"[u]nder the rational basis test, a statute is unconstitutional 
if 
the 
legislature 
applied 
an 
irrational 
or 
arbitrary 
classification when it enacted the provision."  Aicher, 237 
Wis. 2d 99, ¶57 (citing Omernik v. State, 64 Wis. 2d 6, 18-19, 
218 N.W.2d 734 (1974)).  We also explained that "[I]t is not our 
role to determine the wisdom or rationale underpinning a 
particular legislative pronouncement."  Aicher, 237 Wis. 2d 99, 
No.  2003AP988.pdr 
 
5 
 
¶57 (citing Tomczak v. Bailey, 218 Wis. 2d 245, 265, 578 N.W.2d 
166 
(1998)). 
 
We 
recognized 
that 
legislatively 
chosen 
classifications are a matter of line-drawing that might not be 
precise and that at times can produce some inequities, but that 
our goal was simply to determine whether the statutory scheme 
advances a stated legislative objective or an objective that the 
legislature may have had in passing this statute.  Aicher, 237 
Wis. 2d 99, ¶57. 
¶327 We also described the rational basis test, which has 
been used for more than 30 years.  Id., ¶58.  As we said, a 
classification that is part of a legislative scheme will pass 
the rational basis test if it meets five criteria: 
 
(1) All 
classifications 
must 
be 
based 
upon 
substantial distinctions which make one class really 
different from another. 
 
(2) The classification adopted must be germane 
to the purpose of the law. 
 
(3) The classification must not be based upon 
existing circumstances only.  [It must not be so 
constituted as to preclude addition to the numbers 
included within the class]. 
 
(4) To whatever class a law may apply, it must 
apply equally to each member thereof.   
 
(5) That 
the 
characteristics 
of 
each 
class 
should be so far different from those of other classes 
as to reasonably suggest at least the propriety, 
having regard to the public good, of substantially 
different legislation. 
Id. (quoting Tomczak, 218 Wis. 2d at 272-73, in turn quoting 
Dane County v. McManus, 55 Wis. 2d 413, 423, 198 N.W.2d 667 
(1972)). 
No.  2003AP988.pdr 
 
6 
 
¶328 Applying the five-step rational basis test set out 
above, I conclude that the cap on noneconomic damages has a 
rational basis and therefore, it does not violate Ferdon's right 
to equal protection of the law.  First, the cap, now set at 
$445,775, is a limit on noneconomic damages that establishes a 
real difference between those victims of medical malpractice who 
have been awarded more than $445,775 in noneconomic damages and 
those victims who have been awarded less.   
¶329 Second, chapter 655 is a comprehensive legislative 
scheme that creates a right to the unlimited payment of damages 
for economic loss and health care costs, past and future.  Wis. 
Stat. §§ 655.23, 655.27.  It also creates a right to a limited 
payment of noneconomic damages.  Wis. Stat. § 655.017.  This 
statutory scheme was created over several years, as the 
legislature addressed what it perceived as a growing medical 
malpractice crisis.  When the legislature enacted chapter 655, 
it made 11 specific findings about its reasons for doing so.  
§ 1, ch. 37, Laws of 1975.  The findings of the legislature are 
entitled to great weight in our consideration of whether a 
statute has a rational basis.  Strykowski, 81 Wis. 2d at 508.   
¶330 The full text of the 11 legislative findings is set 
out in the majority opinion as a quote of Maurin v. Hall, 2004 
WI 100, 274 Wis. 2d 28, 682 N.W.2d 866, wherein Maurin repeats 
the actual legislative findings.  Majority op., ¶86, n.101.  
Therefore, I will not repeat them here.  However, I do note that 
the majority opinion "summarizes" them into five findings that 
do not adequately incorporate all the reasons the legislature 
No.  2003AP988.pdr 
 
7 
 
gave.  Majority op., ¶86.  The majority opinion omits the 
following findings and their content: 
(a) The number of suits and claims for damages 
arising 
from 
professional 
patient 
care 
has 
increased tremendously in the past several years 
and the size of the judgments and settlements in 
connection therewith has increased even more 
substantially; 
(d) The increased costs of providing health care 
services, the increased incidents of claims and 
suits against health care providers and the size 
of such claims and judgments has caused many 
liability 
insurance 
companies 
to 
withdraw 
completely from the insuring of health care 
providers;  
(f) As a result of the current impact of such suits 
and claims, health care providers are often 
required, for their own protection, to employ 
extensive 
diagnostic 
procedures 
for 
their 
patients, thereby increasing the cost of patient 
care;  
(i) Inability to obtain, and the high cost of 
obtaining, such insurance has affected and is 
likely to further affect medical and hospital 
services available in this state to the detriment 
of 
patients, 
the 
public 
and 
health 
care 
providers. 
§ 1, ch. 37, Laws of 1975.  It is important to note that the 
legislature was concerned with the increasing number of medical 
malpractice suits, with the increasing size of the judgments and 
settlements from those suits and with the results that have 
followed:  (1) increased cost of medical malpractice insurance; 
(2) increased use of diagnostic tests that the patient's 
condition does not require, but are used in an effort to head 
off a malpractice claim if the patent did not do well; (3) the 
rising costs of health care that accompany greater use of 
No.  2003AP988.pdr 
 
8 
 
testing procedures; (4) the early retirement of practicing 
physicians and the choice of a different career by those who may 
have entered the health care field; and (5) the overall 
detriment to the patient, the health care provider and the 
general public.   
¶331 The cap that creates the classification at issue here 
is rationally related to the legislature's goal of reducing the 
size of medical malpractice verdicts and settlements, so that 
premiums for medical malpractice will be contained.  In moving 
toward this goal, the legislature made a rational policy choice 
that some victims of medical malpractice would not receive all 
of the noneconomic damages they were awarded, for the public 
good.  That is a choice that any cap will have to make, no 
matter what the amount.340  However, the legislature did not make 
this choice in a vacuum; it was made as part of a comprehensive 
plan that fully compensated all victims of medical practice for 
all of the other damages they sustained.341   
¶332 In order to achieve full payment, chapter 655 requires 
health care providers to maintain and provide proof of threshold 
medical malpractice insurance before they are permitted to 
provide health care, Wis. Stat. § 655.23(7), and health care 
                                                 
340 The majority opinion asserts that this case is not about 
"all caps."  Majority op., ¶13.  While  it is true that only one 
statutory cap is before us, the classification chosen and the 
reasoning of the majority apply to all caps as we explain below. 
341 There is no limit on guaranteed recovery for economic 
losses, such as loss of earnings or loss of earning capacity.  
There is no limit on guaranteed recovery for health care 
expenses, both past and future.   
No.  2003AP988.pdr 
 
9 
 
providers must contribute to the Injured Patients and Families 
Compensation Fund (the Fund), in amounts sufficient to assure 
the unlimited payment of economic damages, past and future 
medical care and the cap of $445,775 on noneconomic damages.  
Wis. Stat. § 655.27(3).   
¶333 This is a much more generous plan for payment to a 
party injured through the negligence of another than the 
legislature has elsewhere established.  For example, the 
legislature 
requires 
only 
$25,000 
per 
person/$50,000 
per 
occurrence in payment capacity for injuries caused by the 
negligent driving of an automobile.  Wis. Stat. §§ 344.24-.33.  
This may be provided either as a self-insured driver or through 
purchased insurance.  See id.  The damages to one person injured 
in a serious automobile accident can easily exceed the $25,000 
statutory requirement, and at times may exceed that limit by 100 
times.  However, § 344.33 has never been held to deny equal 
protection of the law because many drivers are unable to pay 
$2,500,000 in damages, thereby leaving the most seriously 
injured persons compensated for only 1% of their total damages.   
¶334 Being awarded damages by a jury and being able to 
collect them are two very different things.  Chapter 655 
establishes a statutory right to payment that is unique in 
Wisconsin law.  Ferdon complains that the chapter 655 right to 
payment is not good enough because he did not get all the jury 
awarded him.  His plea ignores the fact that many people are not 
paid all a jury awards them because of the tortfeasor's 
inability to pay.  Many more injured persons settle their claims 
No.  2003AP988.pdr 
 
10 
 
for whatever insurance the tortfeasor has without going to trial 
because they recognize the tortfeasor's inability to pay limits 
their actual recovery.  
¶335 Returning now to the third part of the rational basis 
test (whether the classification would preclude additions to the 
numbers included within the class), Wis. Stat. § 655.017 has no 
limit on the number of persons who are subject to its terms.  
Fourth, the cap of § 655.017 does apply equally to all medical 
malpractice claimants.  And, fifth, the characteristics of those 
who have received an award of more than the cap amount, now 
$445,775, are clearly set by the legislative choice to guaranty 
payment of no more than the capped amount for that type of 
damage in order to reduce the size of medical malpractice 
judgments and settlements and to reduce the cost of malpractice 
insurance. 
¶336 The majority asserts that the cap on noneconomic 
damages violates the equal protection clause because those who 
suffer noneconomic damages in excess of the cap are not able to 
recover the full amount of their damages, while victims of 
medical malpractice suffering noneconomic damages below the cap 
will be fully compensated.  Majority op., ¶¶97-105.  This 
rationale is flawed because it would cause all caps on damages 
to be unconstitutional, as victims suffering damages above the 
No.  2003AP988.pdr 
 
11 
 
threshold, no matter where it is set, will not recover fully 
while those suffering damages below the threshold will.342   
¶337 The 
concurrence 
joins 
the 
majority 
opinion, 
concurrence, ¶189, but then goes on to say some caps are 
constitutional and the cap in Wis. Stat. § 655.15 might pass 
constitutional muster too, but the amount the legislature set is 
just too low.  Id.  There is an inconsistency in the concurrence 
joining the majority's opinion striking down the statute on 
equal protection grounds and yet saying a cap in some higher 
amount would be constitutional.  The inconsistency arises 
because it is the conclusion of the majority opinion that those 
who suffer damages in excess of the cap are denied equal 
protection of the law due to the cap.  Majority op., ¶¶97–105.  
¶338 The concurrence bases its decision that the cap in 
Wis. Stat. § 655.017 is quantitatively insufficient on Article 
I, Sections 5 and 9 of the Wisconsin Constitution.  Concurrence, 
¶189.  The concurrence repeatedly refers to the amount that is 
insufficient as $350,000, but the cap is now $445,775. Is that 
too low?  What is high enough?  Who gets to determine that?  Is 
it a question of fact or a question of law?  How do you tell 
when it is high enough?  If there were no Fund, no statutory 
requirement for health care providers to maintain sufficient 
underlying 
malpractice 
insurance 
to 
guaranty 
payment 
of 
                                                 
342 Indeed, if this were not the case and every victim of 
malpractice were paid the entire amount of noneconomic damages, 
the cap would be entirely ineffective in achieving at least two 
of its purposes, limiting the size of malpractice verdicts and 
settlements and reigning in the escalating costs of malpractice 
insurance. 
No.  2003AP988.pdr 
 
12 
 
unlimited amounts of medical expenses and economic damages and 
no cap, would that be better for Ferdon?  He would be able to 
keep an unlimited jury verdict, but who would pay it?  Would 
nurses leave the profession?  Would other health care providers 
leave the state?  Would Wisconsin continue to have the excellent 
medical care that we have all come to expect?  I conclude that 
the legislature considered all those questions and many more.  
Contrary to the position of the concurrence, concurrence, ¶¶190-
91, the legislature's experimentation with caps of various 
descriptions was not arbitrary.  It was an attempt to slow the 
rapidly escalating costs of health care and yet not lose sight 
of the need to pay those injured by medical malpractice. 
¶339 Furthermore, despite the fact that the very essence of 
a liability cap is to cause some injured persons not to recover 
fully, we have previously ruled that similar provisions, e.g., 
caps on the recovery of victims from government-employee 
tortfeasors, do not violate the equal protection clause.  See 
Sambs v. City of Brookfield, 97 Wis. 2d 356, 377-78, 293 N.W.2d 
504 (1980); Stanhope v. Brown County, 90 Wis. 2d 823, 842-44, 
280 N.W.2d 711 (1979) (both cases involved plaintiffs injured in 
automobile accidents due to highway defects; caps in Wis. Stat. 
§§ 81.15 and 895.43 limited recovery to $25,000).343 
¶340 The legislature also has provided caps on damages 
under the Worker's Compensation Act, ch. 102.  Under the 
                                                 
343 Wisconsin Stat. § 81.15 has been renumbered Wis. Stat. 
§ 893.83 and Wis. Stat. § 895.43 has been renumbered Wis. Stat. 
§ 893.80; the cap on recovery against government tortfeasors has 
been increased to $50,000. 
No.  2003AP988.pdr 
 
13 
 
Worker's Compensation Act, injuries are categorized and each 
category has a damage limit established.  See, e.g., Wis. Stat. 
§ 102.52-.56; Hagen v. LIRC, 210 Wis. 2d 12, 23, 563 N.W.2d 454 
(1997).  Worker's compensation is generally the exclusive remedy 
for workers' claims against their employers.  Wis. Stat. 
§ 102.03(2); St. Paul Fire & Marine Ins. Co. v. Keltgen, 2003 WI 
App 53, ¶19, 260 Wis. 2d 523, 659 N.W.2d 906.  Notwithstanding 
the premise that an injured worker may not be fully compensated 
for his individualized component of noneconomic damages, we have 
held that the Worker's Compensation Act is constitutional.  See 
Pierce v. Indus. Comm'n of Wis., 188 Wis. 53, 54, 205 N.W. 496 
(1925), aff'd Pierce v. Barker, 274 U.S. 718 (1927).  Therefore, 
it is not consistent with prior case law to conclude that the 
cap on noneconomic damages is unconstitutional because some 
persons injured by malpractice will be fully compensated while 
others will not.    
¶341 The 
majority 
opinion 
also 
relies 
on 
Martin 
v. 
Richards, 192 Wis. 2d 156, 531 N.W.2d 70 (1995), for the 
proposition that "the correlation between caps on noneconomic 
damages and the reduction of medical malpractice premiums or 
overall health care costs is at best indirect, weak, and 
remote."  Majority op., ¶166 & n. 221.  The statement is strong 
and broad, but Martin does not support it.  The question 
answered in Martin was whether a retroactive application of the 
cap violated the plaintiff's due process rights.  Martin, 192 
Wis. 2d at 198.  Martin did not examine the prospective effects 
of a cap on noneconomic damages.  There is a significant 
No.  2003AP988.pdr 
 
14 
 
difference in assessing the effect on future insurance premiums, 
when an actuary can use the statute to set insurance rates based 
on malpractice that is yet to occur, and considering any effect 
on those future rates of placing a cap on malpractice that has 
already occurred.  However, notwithstanding that distinction, 
the majority opinion repeatedly inserts Martin as a citation to 
support the proposition that the legislature was wrong in 
finding that a cap on noneconomic damages would have the effect 
of reducing future costs of health care in Wisconsin.  Majority 
op., ¶¶115-19, 166.    
¶342 The majority opinion also adds another new wrinkle to 
our constitutional analysis of a statute that is challenged as 
being unconstitutional on its face.  It asserts, "A statute may 
be 
constitutionally 
valid 
when 
enacted 
but 
may 
become 
constitutionally invalid because of changes in the conditions to 
which the statute applies.  A past crisis does not forever 
render a law valid."  Majority op., ¶114.  There is no authority 
for this extraordinary declaration.  Indeed, I could find no 
Wisconsin case that would support the view of the majority 
opinion in this regard.  Certainly, it differs from what we said 
in Aicher, when we examined whether there was a rational basis 
"when [the legislature] enacted the provision."  Aicher, 237 
Wis. 2d 99, ¶57 (citing Omernik, 64 Wis. 2d at 18-19).  It also 
differs from our focus in Strykowski, where we said "there is a 
rational basis upon which the legislature could and did act when 
enacting Chapter 655."  Strykowski, 81 Wis. 2d at 508 (emphasis 
added).  
No.  2003AP988.pdr 
 
15 
 
¶343 The majority opinion cites Hanauer v. Republic Bld. 
Co., 216 Wis. 49, 255 N.W. 136 (1934) to support its expansive 
assertion in this facial challenge to the constitutionality of 
Wis. Stat. § 655.017.  Majority op., ¶114 n.126.  Its reliance 
on Hanauer is misplaced.  Hanauer involved an as applied 
challenge 
to 
depression-era 
legislation 
that 
imposed 
a 
procedural limitation on a bondholder's remedies.  Hanauer, 216 
Wis. at 50-52.  The statute was held unconstitutional as applied 
under the particular circumstances presented.  Id. at 61-62.  It 
was not held facially invalid due to changed facts, as the 
majority opinion implies. 
¶344 The 
majority opinion 
also 
misuses 
United 
States 
Supreme Court precedent to justify its extensive fact-finding 
that it uses to strike down Wis. Stat. § 655.017.  Majority op., 
¶114 n.126.  It cites United States v. Carolene Products Co., 
304 U.S. 144 (1938), Borden's Farm Products Co. v. Baldwin, 293 
U.S. 194 (1934) and Chastleton Corp. v. Sinclair, 264 U.S. 543 
(1924).  Id. 
¶345 Carolene Products involved a facial challenge to a 
federal statute enacted pursuant to the Commerce Clause.  
Carolene Products, 304 U.S. at 147.  It does not involve a 
statute 
that 
was 
constitutional 
when 
enacted 
and 
became 
unconstitutional due to a factual change, nor does it involve 
fact-finding by the Supreme Court, as the majority opinion 
implies.  When Carolene Products says, "Where the existence of a 
rational 
basis for 
legislation whose 
constitutionality is 
attacked depends upon facts beyond the sphere of judicial 
No.  2003AP988.pdr 
 
16 
 
notice, such facts may be properly made the subject of judicial 
inquiry," id. at 153, the "judicial inquiry" to which it refers 
is done at the trial court.  That the trial court is the fact-
finder was explained in Borden's Farm Products on which Carolene 
Products relied.344  That the trial court is the fact-finder was 
also clearly stated in Chastleton Corp.  The United States 
Supreme Court explained,  
Here however it is material to know the condition of 
Washington at different dates in the past.  Obviously 
the 
facts 
should 
be 
accurately 
ascertained 
and 
carefully 
weighed, 
and 
this 
can 
be 
done 
more 
conveniently in the Supreme Court of the District than 
here.  The evidence should be preserved so that if 
necessary it can be considered by this Court. 
Chastleton Corp., 264 U.S. at 549.   
¶346 And finally, the majority opinion does not subject the 
cap on noneconomic damages to the five-part test used by all 
Wisconsin courts for more than 30 years.  Instead, it conducts a 
mini-trial, to find facts that it then uses to say that the 
reasons the legislature set out when it enacted chapter 655 are 
not borne out by the evidence it has examined.  It conducts its 
trial without the benefit of witnesses, without giving each of 
the parties an opportunity to submit relevant evidence of their 
choosing.  It conveniently ducks evidence that does not fit with 
                                                 
344 Borden's Farm Prods. Co. v. Baldwin, 293 U.S. 194 (1934) 
gave several examples of the "findings" and "facts" and where 
they were to be made.  It explained, "[t]he lower courts had not 
made findings upon crucial questions of fact. . . . We held that 
before the questions of constitutional law, both novel and of 
far-reaching importance, were passed upon by this Court, 'the 
facts essential to their decision should be definitely found by 
the lower court upon adequate evidence.'"  Id. at 212 (citing 
Hammond v. Schappi Bus Line, Inc., 275 U.S. 164, 171-72 (1927)). 
No.  2003AP988.pdr 
 
17 
 
its conclusion.345  For example, the majority opinion notes the 
"General Accounting Office study concluded that malpractice 
claims payments against all physicians between 1996 and 2002 
tended to be lower and grew less rapidly in states with 
noneconomic damage caps."  Majority op., ¶124.  It then avoids 
consideration of this reduction by saying it is not possible to 
tell whether the caps actually were a factor in the reductions.  
Majority op., ¶¶125-26.   
¶347 The process the majority opinion employs gives no 
weight to the findings of the legislature, to which we are 
supposed to give great weight.  Strykowski, 81 Wis. 2d at 508.  
It does not give the benefit of any doubt to the legislature, as 
we should do if we are to accord the legislature the respect of 
a co-equal branch of government.  Cole, 264 Wis. 2d 520, ¶18.  
The majority opinion "talks the talk" about respect for 
legislative enactments and the heavy burden a challenger of a 
statute has, majority op., ¶68, but it does not "walk the walk."  
It simply substitutes its findings for that made by the 
legislature 
and 
concludes 
that 
Wis. 
Stat. 
§ 655.017 
is 
unconstitutional. 
II.  CONCLUSION 
¶348 Because I conclude that Ferdon has not met his burden 
to prove that the cap required by Wis. Stat. § 655.017 is not 
                                                 
345 Malpractice 
premiums 
for 
health 
care 
providers 
practicing in Wisconsin have gone down 5% between 1991 and 2002.  
Martin D. Weiss, et al., Medical Malpractice Caps:  The Impact 
of Non-Economic Damages Caps on Physician Premiums, Claims 
Payout Levels, and Availability of Coverage at 2 (June 2, 2003) 
(available at http://www.weissratings.com). 
No.  2003AP988.pdr 
 
18 
 
rationally related to the legitimate legislative objectives of 
(1) reducing the size of medical malpractice judgments and 
settlements in order to tame the costs of medical malpractice 
insurance; and (2) to make the choice to continue as, or to 
become, a health care provider in Wisconsin desirable so that 
quality health care will continue to be readily available in 
Wisconsin; I respectfully dissent. 
¶349 I am authorized to state that Justices JON P. WILCOX 
and DAVID T. PROSSER join this dissent. 
 
 
No.  2003AP988.pdr 
 
1