Authors: Marc Penchansky and Stephanie Hedrick
The U.S. Chamber Institute for Legal Reform (ILR) polled 1600 voters from last week’s election about their opinions on tort reform. Nearly 9 out of 10 voters feel that the number of frivolous lawsuits is a “total serious problem.” These lawsuits are considered to be with “little merit filed by lawyers mostly out to make money.” The survey also revealed that 83% of the polled number believes that the next Congress should continue to pass legislation to reform the class action lawsuit system.
Prior to the election, The American Tort Reform Association along with Sick of Lawsuits, a campaign headed by Citizens against Lawsuit Abuse, released a report in August 2012, regarding public opinions about tort reform. Of those polled, 89% felt that lawsuit abuse is a problem and 60% believe that the number of lawsuits have hurt the economy. Similar to the ILR survey, the majority of voters agree, “enacting lawsuit reform is an important part of improving the U.S. business environment and attracting and keeping jobs”
At the State Level
Although tort reform on a national level is important, 2012 was a busy year for medical malpractice tort reform in the states. As detailed below, these states have enacted approaches, and sometimes made changes to past mandates, to assist in reducing the cost of malpractice claims.
Patient Safety and Defensive Medicine Workgroup
In February, 2012, Senate Bill 1580 was passed in Oregon establishing a Governor-appointed Patient Safety and Defense Medicine Workgroup (PSDM); a workgroup created to recommend a medical liability legislative proposal for the 2013 Legislative session. The workgroup met three times in 2012 to discuss the Governor’s proposal for an Early Disclosure and Resolution (EDR) program, while guided by these principles listed in the Bill:
- Improve the practice environment to allow physicians to learn from medical errors and improve patient safety;
- More effectively compensate individuals who are injured as a result of medical errors; and,
- Reduce the collateral costs associated with the medical liability system including costs associated with insurance administration, litigation, and defensive medicine.
The workgroup’s final recommendations and draft legislation, which will be introduced in the 2013 Legislative session, recommend working toward an Early Disclosure and Resolution (EDR) program. This program is a first step after a serious event occurs to avoid claiming malpractice and avoiding the trial process. This program will include a notice of a serious event, a 30-day cooling off period and finally a 90-day resolution process in which the parties must discuss and agree upon compensation, and if not, they move into the next phase of the process, mediation. Finally, if the case is not resolved at mediation, the patient or representative may pursue legal action through the traditional litigation system, where the EDR and Mediation process will not be admissible.
This blog has been tracking the trend of state “apology legislation,” which is designed to allow medical professionals to express empathy for and take ownership of an unforeseen outcome without the risk of retaliatory litigation based solely on the statements made at the time of the apology. This year, Massachusetts joined the growing list of states that have enacted the “Apology Approach” to facilitate the early resolution of medical malpractice cases.
On August 6, 2012, Massachusetts Governor Deval Patrick signed the Healthcare Cost Control Bill, known as “Disclosure, Apology and Offer” (“DA&O”), a joint initiative by Massachusetts physicians and lawyers to utilize a more compassionate approach to handling medical errors and malpractice. “The new model includes provisions for a six-month, pre-litigation resolution period that affords the time to go through a DA&O process with the sharing of all pertinent medical records by the patient, full disclosure by providers, and makes inadmissible all statements of apology during litigation.”[ Finally, the organizations work with their liability insurers to give patients a fair and timely offer of financial compensation. “By giving patients the opportunity to receive transparent information and prompt financial recourse, the hope is that the court system would be used only as a last resort.”
Tort Reform in New Hampshire
In New Hampshire, Governor John Lynch vetoed “early offer” legislation. SB 406 established a voluntary program to allow medical providers’ insurance companies to make “early offers” to injured patients who may bring a malpractice suit. If a patient agreed to participate in the program but rejected the early offer, the patient would need to post a bond to cover the defense’s attorneys’ fees and costs. If the jury awards the injured patient less than 125 percent of the early offer, the patient would have to pay the defense’s attorneys’ fees and costs. Supporters argued that the bill would streamline the process and allow patients access to quicker settlements.
Medical Malpractice Caps
Tort reform legislation was established to create a sense of balance between the interest of the patients that are affected by medical negligence and the interest of the physicians who are burdened with the rising cost of insurance premiums and possible threat of a lawsuit. Medical malpractice caps were created to sufficiently compensate patients faced with medical malpractice, without having the physicians become priced out by high insurance premiums (and aim to reduce the amount of frivolous lawsuits brought by personal injury attorneys.)
Overturning States Medical Malpractice Caps
This year, the Missouri Supreme Court, in a 4-3 decision, overturned a $350,000 cap on non-economic medical malpractice damages. The cap was created by the Missouri General Assembly in 2005. On July 31, 2012, in Watts v. Lester E. Cox Medical Centers, the Court ruled the cap unconstitutional because it infringed on an individual’s right to trial by jury.
Upholding States Medical Malpractice Caps
Conversely, the Kansas Supreme Court recently upheld a 25-year-old law, in the case of Miller v. Johnson. That case involving a woman who had the wrong ovary removed by a doctor, reaffirmed the medical malpractice cap of $250,000. The Kansas Medical Society, an association that represents most of the state’s physicians, stated, “The Court properly observed that the intent of the cap was to ensure quality health care availability in Kansas and to promote affordable, available malpractice insurance for health care providers. The court recognized these objectives as legitimate state interests that promote the general welfare.”[
This year the Florida Supreme Court heard arguments in the case of Evette McCall v. United States of America SC11-1145 addressing the malpractice law on the noneconomic medical malpractice caps of $500,000 per claimant and practitioner with an aggregate cap of $1,000,000. These caps were set in 2003. The decision on whether or not the caps are constitutional now rests in the hands of the Florida Supreme Court.
More Tort Reform Please
The proper balance between plaintiff’s rights and an affordable health care system remains difficult to achieve. It is clear that the populace is skeptical about the validity of many medical malpractice lawsuits brought in this county and see tort reform as a way to achieve everyone’s goal of more affordable health care. The answers are not easy but it is clear that federal and state legislatures continue to work to find a system that is fair to all.