Plaintiffs attorneys are increasingly going after investors in high-dollar nursing home lawsuits, seeking outsized payouts that are driven, in part, by better fact-gathering but also appeals to jurors’ growing distrust of the skilled nursing sector.
Making a huge financial claim to kick off a case — in which a jury may already empathize with a vulnerable or elderly patient — also can lead juries to think a higher-than-expected penalty is valid.
“It’s one of the big issues with aberration verdicts that we’re seeing over the last 10 years or so that we just really didn’t see before,” Drew Graham, an attorney at Hall, Booth, Smith in New York, told McKnight’s Long-Term Care News. “Plaintiffs’ lawyers have leveraged the institutional distrust post-COVID. … Ultimately they’re pursuing generational wealth for their clients. They’re trying to get the biggest verdict that they can persuade the jury to award.”
Skilled nursing is still somewhat insulated from the kinds of “nuclear” verdicts that have roiled other healthcare sectors in recent years. Generally, attorneys define a nuclear jury award as one that exceeds $10 million and surpasses what might be expected based on economic loss or other typical arguments.
While there is no comprehensive database of such cases, liability insurance company Future Care Risk Retention Group points to a study by the US Chamber of Commerce Institute of Legal Reform that identified 1,200 nuclear verdicts across industries in the US from 2013 and 2022. That was followed by 129 high-dollar verdicts in 2023, when medical liability cases accounted for nearly 30% — up from roughly 20% during the previous decade.
Tactics increase operating costs
Graham refers to outlier verdicts hitting long-term care providers as “aberrant,” because they are still fairly uncommon and, he said, he thinks the nuclear term implies a form of mutual destruction. In many instances, he added, such cases can be prevented or managed.
Still, there are very real implications for those being sued in this environment — and even those not being sued.
WTW cites nuclear verdicts as a core reason healthcare professional liability coverage costs continue to climb. The insurance broker earlier this month predicted a 5% to 20% increase for healthcare professionals in senior living and care settings in its spring 2026 Marketplace Realities report.
That report cited data showing the average of the top 50 medical malpractice verdicts rose from $32 million in 2022 to $56 million in 2024 — a 75% increase. By January of this year, at least two medical professional liability verdicts had exceeded $100 million.
Sample verdicts
Three recent verdicts demonstrate the danger.
In Illinois last fall, a three-day trial and 90 minutes of deliberations led to a record verdict for the state. A jury awarded a Chicago family $12.2 million in a negligence case brought after their mother’s death. The family alleged understaffing and poor oversight caused the woman’s pressure wounds, which required multiple “extensive and painful treatments.”
Similar allegations led to a $15.8 million verdict in March against Windsor Vallejo Care Center, a California skilled nursing facility now operating under new management and a new name. In addition to finding that staff failed to turn a former resident at risk for wounds, the jury agreed with the plaintiffs’ attorneys’ accusations that the center’s owner and management firm “deliberately” underfunded and understaffed Windsor Vallejo to maximize profits.
Also in California, a jury awarded a whopping $110 million to the family of an assisted living resident who died of hypothermia in a 2019 case. Their attorneys targeted asset manager DigitalBridge Group and private equity investment firm Formation Capital in their wrongful death lawsuit.
Tools for the plaintiffs’ trade
To better ensure those massive awards will ultimately get paid, attorneys are also using new strategies that may ultimately increase risk for investors once considered at arm’s length.
And such large verdicts can beget other large verdicts — contributing to what’s known as social inflation — as jurors become desensitized to massive claims. That trend hasn’t hit skilled nursing the way it has other industries, Graham said. Here, most verdicts are still fact-driven by isolated incidents or at certain venues.
“We don’t see pattern growth across the country yet,” he observed.
But data-mining — potentially using AI — as well as third-party litigation investments and a lack of legal protections in some states mean the sector remains vulnerable, Graham added.
Using publicly available data out of context can be detrimental to providers, and more of it is becoming available annually. Artificial intelligence tools may also make lawyers’ quest for negative information more efficient, though Graham feels the potential of AI to help his clients is only just being discovered.
“I think on balance it’s going to be more helpful for the operators and folks that defend them in litigation because we’re talking in these situations about individuals who have had, in many cases, chronic conditions that are part of life,” he said.
“They come to our facilities and communities and stay for, in many instances, many months or years. Understanding all of that information efficiently in a new way is where some of this AI and AI-assisted workflows are really going to help us understand what has happened and then be able to present it to a jury more effectively and — for the jury’s benefit — maybe even more concisely.”
Building an improved defense
Better advocacy around damage caps also could help, Graham said.
While some states have placed more limits on traditional medical liability in recent years, those are often limited to hospitals and physicians because skilled nursing and assisted living providers aren’t always at the table for discussions on those reforms.
“State legislators are going to exercise good judgment and make decisions based on what’s going on in their states,” Graham added. “Many times, they do include post-acute. But it’s just not always top of mind.”
In one success story, Georgia last year enacted tort reform that was supported by the Georgia Health Care Association. In part, it blocks attorneys from suggesting specific monetary values for noneconomic damages like pain and suffering during opening statements to help prevent members of the jury from “anchoring” to those amounts.
The American Tort Reform Association had named Georgia its top “Judicial Hellhole” because it was home to so many nuclear verdicts, which threaten the future viability of underinsured providers in addition to sending coverage rates for the broader sector soaring.
In a related bill, the state also moved to limit, or at least make more transparent, private equity or other third-party funding of legal claims. Such funding makes more lawsuits realistic by providing funding for firms to represent clients while a case that looks likely to win proceeds.
In most states, neither the court nor the defense knows when investors are involved, raising potential conflict of interest and ethical questions, Graham said. In Georgia, those kinds of financiers must now register their involvement with the state and can see their share of any jury award limited by the courts.
Pursuit of similar regulations elsewhere may be a boon to skilled nursing and other targeted healthcare providers. WTW’s latest report showed that third-party litigation funding is associated with a 60.5% increase in payouts, 140% longer resolution times and a 35.7% reduction in the likelihood of a settlement.