Life Care Plan Valuation
A life care planner says what care the plaintiff will need. The economist says what it will cost over a lifetime and what that is worth today. Meridian prices the plan’s items and shows the work.
From plan to present value
How a plan is valued
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01
Itemize
Item costs, frequencies, start ages and durations are taken from the plan as written.
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02
Set the horizon
Items typically run over life expectancy from published life tables, adjusted where a qualified medical opinion supports it.
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03
Grow by category
Categories such as physician care, drugs, equipment and attendant care can grow at the rates their own price data supports.
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04
Discount
Future costs are reduced to present value at a stated rate, with schedules that show how the total is built.
The deliverable
What it can include
The analysis is built from the life care plan, so what it includes depends on what the plan contains. It can include:
- Item-level schedulePlan items with their annual cost, growth rate, years and present value.
- Summary by categoryTotals by category, such as medical care, therapies, medications, equipment, home modifications and attendant care.
- Alternative scenariosThe plan valued under different life expectancies or the opposing plan’s assumptions, where useful.
- Past vs. future costsWhere past medical expenses are included, they’re kept separate from future costs.
Common questions
Life care plans, explained
Does the economist decide what care is needed?
No. The care needs come from the life care planner and the treating or retained physicians. The economist’s job is to cost the plan as written and reduce it to present value.
Why not grow all items at general inflation?
General inflation blends many kinds of prices together. Medical care and its subcategories, such as physician services, prescription drugs and equipment, can each grow at different rates, so using a rate for each category can give a more accurate figure.
Can you value the defense’s plan too?
Yes. Valuing both plans with the same economic assumptions can show the jury where the difference comes from.
Have a life care plan that needs pricing?
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