The Medical Indemnity Fund in New York

When a child suffers a severe neurological injury during birth due to medical mistakes, the financial weight of lifelong care can be overwhelming. New York operates one of the few state-funded programs in the country designed specifically to address this: the Medical Indemnity Fund (MIF). Understanding how this program works, who qualifies, and what it actually covers can make a significant difference in accessing the care your child needs.

What Is the New York Medical Indemnity Fund?

The Medical Indemnity Fund was created in 2011 under New York Public Health Law Article 29-D. Rather than functioning as a typical compensation program, it works more like ongoing medical insurance for children who have been severely injured at birth.

The Fund serves two primary purposes. First, it guarantees that children with qualifying birth injuries can access necessary medical care throughout their lives without families bearing the full financial burden. Second, it aims to reduce overall healthcare and litigation costs across the state by shifting long-term medical expenses away from individual hospitals and providers.

Unlike traditional settlement arrangements where a family receives a lump sum payment, the MIF pays for medical expenses as they occur. This means families submit claims for services their child needs, and the Fund reimburses those costs directly, similar to how health insurance processes claims.

How Birth Injury Cases Qualify for the Medical Indemnity Fund

Not every birth injury qualifies for MIF coverage. The program has specific eligibility requirements that families must meet before their child can receive benefits.

Your child can only access the Fund after a court judgment or legal settlement has determined that they suffered a birth-related neurological injury caused by medical malpractice. This means you must first pursue a medical malpractice case and either win at trial or reach a settlement agreement that specifically acknowledges malpractice occurred.

The injury must be neurological in nature, meaning it affects the brain or nervous system. This typically includes conditions like cerebral palsy, severe brain damage, or other permanent neurological impairments that occurred during labor, delivery, or the immediate period surrounding birth.

The program covers children injured at any birth setting. Following a 2020 legal decision, the Fund now provides coverage regardless of whether the birth occurred in a hospital, birthing center, or at home, as long as medical malpractice has been established.

Medical Services and Care Covered by the Fund

Once enrolled, the Medical Indemnity Fund covers a comprehensive range of medical services and equipment that children with neurological birth injuries typically need throughout their lives.

The Fund provides payment or reimbursement for:

• Hospital stays and surgical procedures
• Prescription and non-prescription medications
• Physical therapy, occupational therapy, and rehabilitation services
• In-home nursing care and personal attendant services
• Durable medical equipment like wheelchairs, communication devices, and adaptive technology
• Home modifications to accommodate mobility needs and safety requirements
• Vehicle modifications for wheelchair access and medical equipment transport

Understanding what “coverage” actually means under this program is important. The Fund does not simply write checks for any service a family requests. Instead, it operates with specific rules about what gets paid and how much.

How the Medical Indemnity Fund Payment Process Works

Getting services paid through the MIF involves more steps than many families initially expect. The process resembles dealing with traditional health insurance, but with additional layers of complexity.

Any private insurance your family has must be used first. The Fund only covers expenses that other insurance does not pay. This coordination of benefits means families often need to submit claims to their private insurer before the MIF will consider reimbursement.

The Fund reimburses services at “usual and customary” rates or Medicaid reimbursement levels, whichever applies. In practice, this means the Fund may pay less than what providers charge, sometimes significantly less. Some families have found that certain specialists or therapists will not accept these rates, limiting their options for care.

Many services require prior approval from the Fund administrator before you receive them. Submitting a claim after the fact for a service that needed pre-authorization can result in denial. Understanding which services require advance approval helps avoid unexpected denials and out-of-pocket costs.

The claims submission process requires detailed documentation. Families must provide medical records, receipts, explanations of service, and often letters of medical necessity from treating physicians. The Fund’s third-party administrator, Sedgwick Claims Management Services, reviews all claims and makes payment decisions.

Who Administers the Birth Injury Fund in New York

The New York State Department of Financial Services oversees the Medical Indemnity Fund. Rather than handling day-to-day operations internally, the state contracts with Sedgwick Claims Management Services, Inc., a third-party administrator that processes enrollment, reviews claims, approves or denies services, and issues reimbursement payments.

This structure means families interact primarily with Sedgwick rather than directly with state officials. Understanding that Sedgwick makes most operational decisions about your claims can help you know where to direct questions and appeals.

Financial Challenges Facing the Medical Indemnity Fund

By 2025, approximately 1,000 children were enrolled in the Medical Indemnity Fund, and the program was facing serious financial strain.

The Fund developed a shortfall exceeding $3 billion, creating uncertainty about its ability to continue providing consistent care coverage. This funding crisis led to tangible impacts on families, with some reporting increased claim denials, longer approval times, and difficulty accessing the same level of services they had received in previous years.

In June 2025, after significant public scrutiny and advocacy pressure, the New York State government quadrupled funding to the program. While this injection of resources addressed the immediate crisis, questions about the Fund’s long-term financial stability remain unresolved.

For families depending on the MIF, these funding issues translate into real-world challenges. Some have described finding themselves in administrative battles over services their children clearly need but that the Fund disputes as unnecessary or excessive. Others have experienced delays in getting approvals for time-sensitive therapies or equipment.

Common Problems Families Face with the Medical Indemnity Fund

Despite its intended purpose of ensuring lifelong care, many families encounter significant obstacles when trying to access MIF benefits.

The coordination of benefits requirement creates complexity. Families must first navigate their private insurance claims process, wait for denials or partial payments, and only then submit to the MIF. This layering of paperwork and waiting periods can delay getting children the services they need.

Rate restrictions create access barriers. When the Fund only reimburses at Medicaid rates for certain services, families may discover that qualified specialists refuse to accept these patients because the reimbursement does not cover their costs. This effectively limits choice of providers, sometimes forcing families to travel significant distances or settle for less specialized care.

Prior authorization requirements mean families must anticipate needs in advance. For children with complex, evolving conditions, predicting what equipment or services will be needed months ahead is not always possible. When situations change quickly, getting emergency approval can be difficult.

The documentation burden is substantial. Some families report spending hours each week gathering records, writing explanations, following up on pending claims, and appealing denials. For parents already managing intensive caregiving responsibilities, this administrative load adds another significant stressor.

Disputed denials have increased as the Fund faced financial pressure. Services that were previously approved without question sometimes get denied as “not medically necessary” or “experimental,” forcing families into lengthy appeals processes while their children go without needed care.

Getting Help Navigating the Birth Injury Compensation Program

Given the complexity of the Medical Indemnity Fund, many families benefit from professional assistance in navigating the system.

Working with attorneys experienced in birth injury cases and MIF enrollment helps ensure that settlement agreements properly establish eligibility and protect your rights to future benefits. These lawyers understand the specific language needed in settlements to secure Fund access and can anticipate potential coverage issues.

Medical malpractice attorneys who regularly work with MIF cases often maintain relationships with the Fund administrators and understand how to present claims effectively. They know which documentation strengthens approval chances and how to appeal denials successfully.

Patient advocates and case managers familiar with the MIF can help coordinate between multiple insurance providers, organize medical documentation, track claim submissions, and follow up on pending approvals. Some families hire private case managers specifically to handle MIF administration, finding that the time saved and improved approval rates justify the cost.

Connecting with other families who have experience with the Fund provides practical insights. Parent support groups and online communities share information about which providers accept MIF rates, how to navigate common claim denials, and strategies for getting needed services approved.

The Future of Birth Injury Compensation in New York

The Medical Indemnity Fund represents a pioneering approach to addressing the catastrophic costs of birth injuries, but its recent financial crisis has exposed significant vulnerabilities.

Advocacy organizations are pushing for structural reforms to expand coverage criteria, increase rate reimbursements to levels that ensure adequate provider participation, and improve transparency in decision-making processes. Some propose eliminating the requirement for prior malpractice findings, moving toward a no-fault compensation model for severe birth injuries regardless of whether negligence occurred.

Legislative discussions continue about ensuring long-term funding stability. The 2025 funding increase addressed immediate needs but did not establish a permanent solution to the structural underfunding problem.

Greater attention is being paid to ensuring timely access to therapies and specialized care as children age. Advocates point out that early intervention during critical developmental windows can significantly improve outcomes, making claim delays particularly harmful.

For families currently navigating the system or considering whether to pursue a birth injury case, understanding these ongoing challenges and potential changes helps set realistic expectations about what the Fund can provide.

Finding Reliable Information About the Medical Indemnity Fund

When researching the Birth Injury Compensation Program, prioritize official and authoritative sources.

The New York State Department of Financial Services provides official program information, though families often note that publicly available details are limited compared to the complexity of actually using the program.

The New York State Legislature website contains the full text of Public Health Law Article 29-D, which establishes the Fund and defines eligibility requirements. Reading the actual statute, while dense, provides clarity about legal rights and program scope.

Recent news coverage of the funding crisis and program challenges offers context about current operations and pending reforms. Major New York newspapers have investigated the Fund’s difficulties, providing insight into real experiences of families in the program.

Medical malpractice attorneys who regularly handle birth injury cases can provide current, practical information about how the Fund actually operates, typical timelines, common approval challenges, and realistic expectations for coverage.

Understanding Your Options After a Birth Injury

The Medical Indemnity Fund is only available after establishing medical malpractice through legal proceedings. This means families facing the possibility of a birth injury must first understand whether malpractice occurred and whether pursuing a case makes sense for their situation.

Not all birth injuries result from medical mistakes. Some complications occur despite appropriate care, making malpractice claims inappropriate. Consulting with birth injury attorneys who offer free case evaluations helps determine whether your situation warrants legal action.

If malpractice did occur, successfully proving it requires extensive medical evidence, expert testimony, and legal expertise. Birth injury cases are among the most complex in medical malpractice law, typically requiring attorneys who specialize specifically in this area.

The decision to pursue a case involves weighing potential benefits against emotional costs, time commitments, and the uncertainty of litigation outcomes. For some families, accessing the Medical Indemnity Fund’s lifelong coverage justifies the challenges of a malpractice case. Others may choose different paths based on their circumstances.

Understanding that the MIF exists and how it operates provides important context for making informed decisions about your family’s legal and medical options after a serious birth injury.