Jury Awards $261 Million in Damages Against Johns Hopkins All Children’s Hospital in Landmark Lawsuit

VENICE, Fla. — Johns Hopkins All Children’s Hospital is reeling after a jury ruled against them on every count in a high-profile lawsuit. The hospital now faces a staggering $261 million award in compensatory and punitive damages to Maya Kowalski and her family. The amount is nearly half of the $592 million in revenue reported by the St. Petersburg hospital in its most recent tax return.

The eight-week civil trial concluded with the jury finding that All Children’s falsely imprisoned and battered Maya, who was 10 years old at the time of the incident. The hospital was also found guilty of intentional infliction of emotional distress on Maya and her mother, Beata Kowalski, which subsequently led to Beata’s suicide. Additionally, there were findings of medical negligence and fraudulent billing against the hospital.

The hospital’s chief financial officer, Sherron Rogers, testified during the trial that if the verdict stands and the hospital is unable to successfully appeal, it could be forced to tap into its cash reserves. This could potentially impact future credit ratings and delay future expansion projects for the hospital.

It is anticipated that All Children’s will have insurance coverage for a portion of the $211 million awarded in compensatory damages. However, Florida law prohibits insurance from covering the $50 million in punitive damages awarded by the jury.

While All Children’s is part of the larger Johns Hopkins health system, it files its own tax returns. The hospital spokesperson declined to comment on whether the hospital has insurance to cover the compensatory damages or if its parent organization would provide financial support.

Typically, hospitals rely on a combination of self-insurance carried by medical staff and commercial insurance to cover liability and malpractice claims. However, with such a substantial award, All Children’s may need to tap into multiple commercial policies to cover the loss. This could result in increased self-insured retentions and higher future insurance premiums.

All Children’s tax filing reveals significant assets, including a cash reserve of about $32 million and $448 million in stocks and shares. The hospital primarily relies on Medicaid, which only covers 70 cents on the dollar for the cost of treating children. This large award could potentially affect the hospital’s ability to reassure creditors and maintain a solid credit rating, making it more expensive to borrow money for future projects.

Despite the significant damages awarded to Maya and her family, it is important to note that All Children’s has turned a profit in recent years. For the fiscal year ending June 2022, the hospital reported $30 million in operating profit, which is reinvested into the hospital as a nonprofit organization.

This recent award surpasses the compensation provided to families of children who suffered permanent injuries or death after heart surgeries at the hospital. All Children’s previously settled with two families for $40 million after their children were paralyzed, while two other families received settlements totaling $3.1 million for the loss of their children. Following these incidents, the hospital suspended heart surgeries and experienced changes in its executive leadership.

All Children’s Hospital plans to appeal the jury verdict, potentially delaying any payments until next year. However, if the verdict holds, the hospital will face significant financial repercussions that may impact its operations and future endeavors.

In summary, Johns Hopkins All Children’s Hospital has been ordered to pay $261 million in damages after a jury ruled against them in a high-profile lawsuit. The hospital plans to appeal the verdict, but if unsuccessful, it could tap into its cash reserves and potentially face challenges in maintaining its credit rating and pursuing future expansion projects. The hospital’s insurance is expected to cover a portion of the damages, but the punitive damages will not be covered. This landmark case could have far-reaching implications for the hospital and its ability to secure affordable insurance coverage in the future.