Research & Publications

Damages: Estimating Pecuniary Loss (Chapter 10)

by Cara L. Brown

Chapter 10 - Valuation of Costs of Care

Chapter 10 is concerned with the economist's role in assessing costs of future care. Not to be confused with the role of the occupational therapist, or of the vocational expert in some cases, who actually recommends what care items or treatment will be required by the plaintiff, the economist shows the present value of each costs of care item, as well as the specific multiplier for that item so items can be easily deleted from the overall cost of care award or so their costs can be modified. Accordingly, Chapter 10 explores how to apply discount rates to cost of care awards, accounting for the rate of productivity for certain care items and the application of mortality tables and contingencies to cost of care awards. A sample cost of care table is provided to illustrate the use of multipliers. Other topics include special considerations for spinal cord injured plaintiffs, applying the tax gross-up to cost of future care awards, the role of management fees, and the overlap of the cost of future care head of damage with other heads of damage. Back