Two Strikes for Tort Reformers in New Jersey, New Hampshire

Author: Marc L. Penchansky

As health care costs continue to be a concern for their constituents, state legislatures have looked for unique ways to assure access to health care while maintaining or lessening costs.  In order to achieve these goals, state legislatures often look to reform medical malpractice litigation.  Last week, two unique tort reform proposals were defeated in New Jersey and New Hampshire.

In New Jersey, Assembly Bill A2178  sought to provide civil immunity to retired volunteer physicians who provide care to the indigent at nonprofit free-standing clinics and federally qualified health centers.  The clinic or center and its trustees, directors, officers, employees, agents, and volunteers would also be afforded civil immunity.  The grant of immunity would not extend to gross negligence or willful and wanton conduct.  Further, the legislation required that the patient and the physician agree to the immunity prior to the rendering of the patient care or treatment. 

The arguments in favor and in opposition to this bill are easy to surmise.  Supporters of the legislation argue that granting civil immunity to volunteer physicians would serve as an incentive that would help free clinics recruit more physicians who would in turn treat more patients.  On the other hand, opponents argue that this bill exerts a cost for free medical care, which is the disavowing of one’s legal rights.  In the end, the bill failed to pass in the last legislative session.

In New Hampshire, Governor John Lynch vetoed “early offer” legislation.  The bill  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.  An earlier version of the bill also required the rejecting patient to prove their case not by a preponderance of the evidence but by a heightened, clear and convincing standard.   The heightened standard provision was not in the final bill sent to the Governor.

Supporters argued that the bill would streamline the process and allow patients access to quicker settlements.   Governor Lynch in his veto noted, “While this legislation is well intentioned, I do not believe that it sufficiently and fairly balances the interests of the general public with the interests of medical providers in expeditiously resolving medical injury claims.”   Governor Lynch took special exception to the “loser pays” provision.  Governor Lynch wrote:

That standard is inappropriate for medical malpractice cases. For example, an injured patient submitted a claim for $175,000 in economic damages. The medical provider disagrees on the costs of treatment and offers $140,000. If a jury eventually agrees with the patient but awards only $172,000 because there was a double billing error, the patient has won the case, but will still have to pay the medical providers legal fees because the award was less than 125% of the early offer. That is not the right result.

Although proponents of tort reform may be discouraged by these losses, they should be heartened by legislators’ willingness to propose unique solutions.  It will be interesting to watch lawmakers continue to balance the competing interests and to see how tort reform efforts continue to evolve.  Perhaps, a legislator will stumble on the holy grail and craft a proposal that is responsive to all parties’ concerns.