Consumer Watchdog – MALPRACTICE: BUSH ANNOUNCES PLAN TO CAP JURY AWARDS, LIMIT LAWSUITS

American Health Line

Blaming excessive jury awards and "frivolous lawsuits" for rising malpractice insurance premiums, President Bush yesterday as expected reiterated his call for legislation that would cap non-economic damages in malpractice suits at $250,000 and would limit the number of suits that can be filed, the New York Times reports. Speaking at the University of Scranton in Pennsylvania, Bush said, "Excessive jury awards will continue to drive up insurance costs, will put good doctors out of business or run them out of your community and will hurt communities like Scranton, Pa." (Stevenson, New York Times, 1/17).

Bush's proposal would limit non-economic damages, such as those for pain and suffering, to $250,000; limit punitive damages to "reasonable" amounts; require payments of judgments over time, rather than in a lump sum; limit the amount of time a patient has to file suit; limit the amount of judgments doctors must pay if other parties, such as an insurer, made payments to compensate for losses; and link defendants' share of payments to their degree of culpability (Gerstenzang, Los Angeles Times, 1/17).

Bush said, "The problem of those unnecessary costs don't start in the waiting room or the operating room. They're in the courtroom. Everybody's suing, it seems like. There are too many lawsuits in America, and there are too many lawsuits filed against doctors and hospitals without merit" (Curl, Washington Times, 1/17).

MODEL BILL

According to the New York Times, Bush's plan is similar to provisions in a bill (HR 4600) Rep. James Greenwood (R-Pa.) introduced last year (Oppel, New York Times, 1/17). The House passed the bill last year, but the Senate did not consider it (Kornblut, Boston Globe, 1/16).

The proposal also is "largely modeled" on a 1975 California law that capped jury awards for noneconomic damages at $250,000, a move supporters say has held the state's malpractice premiums below the national average, according to the New York Times (Oppel, New York Times, 1/17). However, consumer advocates dispute claims that the 1975 law helped stabilize malpractice premiums, and said they were the result of state insurance reforms passed by voters in 1988. An analysis conducted by the California-based Foundation for Taxpayer and Consumer Rights found that malpractice premiums in the state increased 175% between 1975 and 1985, but dropped 8% between 1988 and 2000, after the insurance laws were altered (Los Angeles Times, 1/17).

PROPOSAL'S CHANCES

Bush's plan is expected to "sail through the House," but a "fight is expected" in the Senate, the New York Times reports (Oppel, New York Times, 1/17). Sen. Edward Kennedy (D-Mass.) has threatened to fight the proposal with a filibuster. Although Republicans hold a majority of 51 seats in the Senate, breaking a filibuster requires 60 votes (Los Angeles Times, 1/17). Supporters of the Bush proposal intend to pressure senators from states that have experienced the largest increases in malpractice premiums, according to the New York Times. Greenwood said proponents of the bill would "focus on" about 15 to 20 "swing votes," but he added that he expects it to be "an uphill battle" (Oppel, New York Times, 1/17)

REACTION

Following Bush's speech, incoming Senate Health, Education, Labor and Pensions Committee Chair Sen. Judd Gregg (R-N.H.) announced his panel would hold hearings on malpractice premiums, CongressDaily/AM reports. "In my home state of New Hampshire, we have expectant mothers who are in need of prenatal physicians, and we have qualified doctors who want to provide that care but cannot, because incredibly high premiums have driven them out of state or out of business," Gregg said. Senate Majority Leader Bill Frist (R-Tenn.) said, "The president is right. This is a crisis of health care access and skyrocketing costs, and we know what needs to be done -- passing meaningful medical litigation reform" (Rovner, CongressDaily/AM, 1/17).

However, Bush's speech brought "immediate condemnation" from Democrats, trial lawyers and patient advocates. Trial lawyers said Bush's plan would "do little" to lower premiums and would make it more difficult for patients with legitimate cases to sue. Joseph Quinn, a lawyer who recently agreed to a $7 million settlement with a hospital in Pennsylvania in a malpractice case, said, "If you impose caps, lawyers cannot afford to pursue these cases and patients cannot afford to hire lawyers to help them" (Stevenson, New York Times, 1/17). Former House Democratic Leader Rep. Richard Gephardt (D-Mo.) said, "If the president is serious about addressing the rising cost of medical malpractice insurance rates, he should focus his effort on reforming the insurance industry and reining in its control over our healthcare system" (Los Angeles Times, 1/17). Frank Sloan, a Duke University economics professor, added that lawmakers could reduce premiums by "improving the structure of the insurance marketplace," according to the New York Times. He called medical malpractice "the most cyclical health policy there is," adding, "There are periods of time when premiums stop going up, and then nobody's interested, then again we get a crisis and everybody says juries are terrible" (Oppel, New York Times, 1/17).

BROADCAST COVERAGE

The following broadcast programs yesterday reported on Bush's medical malpractice plan:
- ABCNews' "World News Tonight": Video of the segment in RealPlayer is available online at: pnm://64.226.148.54/AHL/bushcaps011703.rm (Jennings, "World News Tonight," ABCNews, 1/16).
- CBS' "Evening News": The segment includes comments from Kennedy. A transcript and video of the segment in RealPlayer are available online at: http://www.cbsnews.com/stories/2003/01/16/politics/main536718.shtml (Kaledin, "CBS Evening News," CBS, 1/16).
- NBC's "Nightly News": A transcript and video of the segment in Windows Media are available online at: http://www.msnbc.com/news/860277.asp?0dm=V16MH (Gregory,
"Nightly News," NBC, 1/16).
- PBS' "Nightly Business Report": The segment includes comments from Baptist Hospital Director of Emergency Services Dr. David Nateman and Consumer Federation of America Insurance Director Robert Hunter. A transcript of the segment is available online at: http://www.nightlybusiness.org/transcript.html#story3 (Woods, "Nightly Business Report," PBS, 1/16).
- PBS' "NewsHour with Jim Lehrer": The segment includes comments from Joanne Doroshow,
executive director of the Center for Justice and Democracy and co-founder of Americans for Insurance Reform; Dr. Donald Palmisano, president-elect of the American Medical Association;
Larry Smarr, president of the Physicians Insurers Association of America; and Ken Suggs, secretary of the Association of American Trial Lawyers. A transcript and audio of the segment in
RealPlayer are available online at: http://www.pbs.org/newshour/bb/white_house/jan-june03/malpractice_01-16.html (Dentzer/Suarez, "NewsHour with Jim Lehrer," PBS, 1/16).