Medical Malpractice Reform High on States’ Agenda

Thirty-four states debated medical malpractice reform this year, and states Arkansas, Idaho, Montana, Nevada, New Hampshire, Ohio, Texas, Utah and West Virginia — enacted laws, according to the National Conference of State Legislatures.

The issue is still being considered in special sessions in some statehouses and lawmakers and policy analysts expect it to be back next year.

“It’s an incredibly contentious issue and that is largely the reason why it’s so difficult to come to a compromise and get something passed in the legislature,” said Trudi Matthews, chief health policy analyst for The Council of State Governments (CSG).

Intense lobbying from doctors, lawyers and insurance companies has generated a torrent of headlines and a sense of urgency for lawmakers to act, analysts said.

In several states doctor discontent with soaring insurance premiums has threatened patients’ access to certain types of health care.

“Doctors were bailing out, trauma centers were closing, OB-GYNs stopped accepting new patients in certain parts of the country and women couldn’t find a doctor to deliver their babies … and (legislators) were charged with preventing that end result,” said Emily Cornell, a policy analyst at the National Governors Association, Center for Best Practices.

The most common and controversial medical malpractice reform measures would cap jury awards for non-economic damages, better known as “pain and suffering.”

Proponents of such caps doctors groups and insurance companies blame excessive jury awards for soaring malpractice insurance premiums. They say limiting the amount of money insurance companies could potentially pay out for negligent doctors would decrease risk and lower premiums.

A cap enacted almost 30 years ago in California is often credited for stabilizing the insurance market in that state and serves as a model for current proposals.

Trial lawyers and other opponents of caps say high premiums are due to poor investment practices by insurance companies. They say caps undermine the victims’ ability to gain fair compensation for injuries due to medical error and question whether caps will solve the problem.

Washington state Rep. Patricia Lantz (D) opposes capping non-economic damages. She sponsored a package of five different medical malpractice bills that passed the Washington State House of Representatives, but the GOP-controlled state Senate blocked her legislation.

Conversely, a bill that would have enacted a $300,000 cap passed the state Senate but did not receive a hearing in the House judiciary committee, which Lantz chairs.

“Why are we hanging all of our hopes on this Holy Grail that is not guaranteed to produce results? It’s all because it’s a political thing. And by (the Senate) saying they wanted caps or nothing, they got nothing,” Lantz told Stateline.org.

Large lobbying groups, such as the American Medical Association (AMA) and the Association of Trial Lawyers of America (ATLA), made the debate over caps a top legislative priority and have put state legislators under tremendous pressure to act immediately, policy analysts said.

“(Caps) are what everybody’s focused on because there are such strong interest groups surrounding this issue,” said Mimi Marchev, a senior policy analyst at the National Academy of State Health Policy (NASHP), a research organization based in Portland, Maine.

Health care analysts tracking the issue said state lawmakers recognize that caps are not a quick fix and are also considering more comprehensive reforms.

“It’s not you’re either for caps or against caps. It’s not that cut and dry. Unfortunately, the trial lawyers and physicians have said it’s an either-or proposition and I think that for most people it’s a gray area,” the NGA’s Cornell told Stateline.org.

Here’s a sampling of other recent state action:

• In Florida, Republican Gov. Jeb Bush called for a third legislative session to begin Aug. 5., and caps on non-economic damages will likely be the center of debate. The governor and the House of Representatives support a $250,000 cap, but the Senate has only agreed to a $1.5 million cap. The issue has been on the governor’s agenda since last year when he appointed a task force to examine malpractice issues. 
• Ohio passed a bill amending the statute of limitations for filing a claim for medical malpractice so that there is no limit on gaining compensation for economic damages, but the Buckeye State capped non-economic damages at $350,000, said Republican state Rep. Greg Jolivette, who supported the legislation because he was “concerned about the future of health care in Ohio.” 
• In New Jersey, Democratic Gov. James McGreevey denied doctors’ requests for a special session to deal with the state’s malpractice crisis. The governor’s decision came at the heels of an announcement by the state’s largest insurance company, Princeton Insurance of West Windsor, that it would cease writing liability policies next month, the Trenton Times reported. 
• New Hampshire, Gov. Craig Benson (R) signed Senate Bill 119July 8 that reverses a 2001 state Supreme Court ruling expanding plaintiff rights. The bill will prevent some medical malpractice lawsuits that are filed on the basis of a “loss of opportunity” for an improved life, NCSL said. 
• In Kentucky, Republican gubernatorial candidate Ernie Fletcher, a physician, has called for an amendment to the state constitution to allow caps on jury awards in malpractice suits, according to a June 30 press release. 
• And in West Virginia, a state that’s been actively grappling with malpractice issues for more than two years, legislators enacted a bill that establishes tax credits for doctors to help them cover their insurance costs.

“I haven’t heard anybody say the crisis is over, everything is peachy-keen, no need to worry again, everything is fine,” the NGA’s Cornell said. “In some states somebody’s plugged the dam, but whether or not it’s a permanent fix or temporary fix is hard to say.”