Twenty-five years ago, Florida was facing a medical-malpractice liability crisis. Between 1980 and 1986, premiums for Florida OB/GYNs had risen nearly 400%, and Miami-Dade County OB/GYNs were paying upward of $175,000 for coverage. Some doctors threatened to go on strike or leave the state, creating widespread fear that before long pregnant women might be turned away from hospitals. Lawmakers blamed the problem on too many malpractice claims and bloated jury awards and looked for a way to reduce the frequency and severity of tort cases.

TRAUMATIC: Joel and Jill Cotton and daughter Mallory visit Noah's gravesite. Noah was deprived of oxygen during a difficult delivery in 1999 and developed cerebral palsy. He died in 2002. "It's a secret society over there," Joel Cotton says of his dealings with NICA.

The Legislature's solution was the creation of the Florida Birth-Related Neurological Injury Compensation Association (NICA), a no-fault compensation program restricted to a narrow class of infants who suffered catastrophic injuries during the birth process. Disposing of such cases in an alternative manner, the lawmakers reasoned, would unburden the tort system and hopefully stabilize liability premiums for doctors.

Under NICA, infants who suffer a brain or spinal cord injury caused by oxygen deprivation or mechanical injury during labor or delivery or from resuscitation immediately after delivery are entitled to compensation for all necessary and reasonable medical expenses that are not already covered by private insurance news or other sources. Additionally, their parents receive a one-time $100,000 payment and a $10,000 death benefit. Doctors, hospitals and the state fund the program. OB/GYNs pay $5,000 each year to participate in NICA and receive an equivalent reduction on their insurance policies. Midwives pay $2,500 for inclusion in NICA. Non-participating physicians pay $250 a year, and hospitals contribute $50 per live birth to help fund NICA.

NICA Executive Director Kenney Shipley

Nearly 20 years after its inception, however, NICA is getting mixed reviews. The 1,035 doctors and midwives who participate tend to laud the program. Resolving matters on a no-fault basis reduces some of the stress associated with practicing high-risk medicine, and several subsequent analyses of the program indicate it has reduced malpractice liability premiums. NICA Executive Director Kenney Shipley says the program saves millions of dollars each year by keeping cases out of the courts. "You get in front of a sympathetic jury, and people want to provide for a baby no matter what the cost, and witnesses often inflate what the potential costs are in the future. We pay actual costs. We pay at reasonable rates for the communities."

Dr. Robert W. Yelverton, CEO and medical director of Tampa Bay Women's Care and the immediate past president of the Florida OB/GYN Society, just finished chairing a task force that spent a year looking at NICA. An actuarial firm hired by the task force recently concluded that NICA saves OB/GYNs about $49,770 on their malpractice premiums.

To create more savings, Yelverton talks of potentially expanding NICA to cover an even broader category of children, including those suffering from brachial plexus injuries, damage to a network of nerves that conducts signals from the spine to the shoulders, arms and hands. Brachial plexus injuries are not uncommon during birth, often occurring when a baby's shoulder gets stuck in the birth canal, causing the brachial plexus nerves to stretch or tear. Such damage can result in limp or paralyzed arms, a lack of muscular control in hands or arms or a lack of feeling or sensation in limbs. Doctors are willing to pay for broader coverage, Yelverton says. "Eighty percent are willing to pay up to another $1,000 a year if we could expand it to include more babies."

The Florida Legislature's Office of Program Policy Analysis and Government Accountability estimates that adding brachial plexus injuries to the covered class of injured babies would result in 254 to 339 additional claims every year and increase the expense of the program from $9.5 million to $33.9 million.

Expanding NICA coverage would also enrage Florida's trial lawyers, who cite widespread flaws with NICA. "It's worse than an abomination. It's the biggest scam ever perpetrated on any public and any state," says Theodore Babbitt, a personal injury attorney in West Palm Beach.

Babbitt says in his experience, NICA merely exists to dispose of malpractice claims that should be handled in a court. If there's not a legitimate malpractice claim, Babbitt says, "they generally deny the claim to a child, and if there is, they generally grant the claim to the child."

Orlando injury lawyer Scott McMillen agrees that NICA is not the "no-fault" system it purports to be. "They're calling it a no-fault program. It's not really no fault. By definition, all the faultless injuries are excluded, and it only includes those most likely to be caused by negligence on the part of" healthcare providers.

NICA critics point out that the "no-fault" resolution NICA presents also creates a tempting shield for negligent hospitals and doctors to hide behind. That's what the lawyers representing Tracie and Ulysses Jackson argued when Tracie's uterus burst in 1999 and her oxygen-deprived daughter was born severely brain damaged.

The Florida hospital where Jacqueline was born claimed it was immune from a lawsuit under NICA. It argued that the injuries Jacqueline suffered were nobody's fault, but just one of the many complications that can occur during birth.

But Tracie Jackson's lawyers eventually discovered that the hospital had administered a drug called Cytotec to induce Jackson's labor. Cytotec is not approved by the FDA for inducing labor. It is only FDA-approved for treating ulcers. The drug's manufacturer warns that Cytotec may cause violent and rapid contractions, bleeding, uterine rupture, infertility, severe brain damage and maternal or fetal death when used for labor. The hospital eventually agreed to pay the Jacksons $6 million.

McMillen says that NICA is so inconsistent with regard to what medical expenses it will and won't pay for that he helped form a support group for NICA families so that they can compare notes to make sure they are all getting what they are entitled to.

Pensacola father Joel Cotton was introduced to NICA in 1999, after the traumatic birth of his son, Noah. During delivery, Cotton's wife's uterus ruptured and an emergency Cesarean section was performed. Noah, however, was deprived of oxygen in the process and ended up with severe cerebral palsy, unable to eat, talk or walk. He required around-the-clock care. He died in his sleep in 2002.

Cotton says that while the NICA staff was kind and compassionate, they weren't necessarily forthcoming with information about what was and wasn't covered by the program. Cotton discovered on his own that his wife, Jill, was entitled to reimbursement for the full-time care she provided for their son. Cotton says no one ever explained to him that NICA would cover co-payments for medications and medical visits and reimburse gas costs for trips to the doctor's office. "It's a secret society over there," says Cotton. "It's all gray."

Tampa attorney Richard Gilbert is representing two Florida families in a class-action lawsuit against NICA on behalf of parents who say the association has failed to consistently reimburse them for residential and custodial care they provide for their own children. Over the years, NICA has reimbursed some parents for their custodial care but denied it in other cases. More recently, NICA has sought to ban and reduce the amount of compensation it pays to parents who have left their jobs to care for their children, arguing that the one-time $100,000 payment was all they are entitled to under the law. The case is working its way through the Hillsborough County Circuit Court.

Cotton, however, says the $100,000 lump sum is inadequate and should at the very least be adjusted for inflation. "The objective was to help keep OB/GYNs in the state of Florida, and I think yes they're accomplishing that, but they're not doing anybody any good in the process. They could do better. If you're going to tell me I can't sue the doctor because of this, damn it, I want things taken care of," says Cotton.