§ 5036.Adjustment of payments.

The periodic-payment structure Article 50-A imposes isn't meant to trap a malpractice plaintiff in a rigid schedule when circumstances change. CPLR 5036 gives the court discretion to accelerate remaining payments into a lump sum when continued periodic payments would create a hardship. Before ordering that relief, the court has to make four specific findings: unanticipated and substantial medical, dental, or other needs have arisen warranting a lump sum; the lump sum wouldn't impose an unreasonable financial burden on the debtor; it would accommodate the plaintiff's future medical and other needs; and it would serve the interests of justice.

Once a court orders a lump-sum payment, responsibility for paying it shifts. The medical malpractice insurance association created under article 55 of the insurance law pays the lump sum, not the insurer that issued the original annuity contract. That original insurer keeps making its scheduled payments, but now directs them to the association rather than to the plaintiff; if the lump-sum order covers only part of the remaining payments, the insurer apportions its future payments between the association and the plaintiff or successor in interest accordingly.

The lump sum itself is capped. It's calculated based on the present value of the annuity contract for the converted payments, valued as of the time of the calculation, and it can never exceed the present value of the annuity contract's remaining periodic payments. That ceiling keeps the association's payout tied to what the annuity was worth rather than to the face value of payments the plaintiff would have received over time.