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An Issue Potent Enough To Divide Brown and Nader: The Malpractice Damage Cap

LOS ANGELES TIMES
http://www.latimes.com/business/la-fi-lazarus-20150807-column.html

Ralph Nader goes way back with Gov. Jerry Brown. Their relationship dates to the 1970s, when both men were eagerly shaking things up from their respective perches on the progressive left.

Between them, they've run for president eight times. In 1992, Brown said he'd appoint Nader to his Cabinet if elected to the White House.

But when I spoke with Nader this week, the man who wrote the playbook for consumer advocacy was mad as hell at his former comrade.

"Yeah, I'm very upset," he told me. "Jerry has a moral and political responsibility here."

What has Nader so cheesed is Brown's reluctance to take a leadership role in fixing California's Medical Injury Compensation Reform Act, a 1975 statute that Brown signed into law during his first stint as governor.

The law placed a $250,000 cap on damages for pain and suffering that resulted from medical malpractice. Although that might help doctors sleep at night, the upshot is that it limits how much patients will receive in court if they can't prove significant economic harm from a bungled treatment or surgery.

It also makes it hard to sue unless you're pulling down a fat paycheck and can show that future earnings have been diminished. If you're a kid, say, or a senior citizen, you'll probably have a tough time finding a lawyer who will take on what's usually a complicated and costly case to pursue.

Another problem with the law: It was never indexed for inflation. So while the cost of healthcare and doctors' fees have gone up over the years, the malpractice cap has diminished the value of any pain-and-suffering damages on an inflation-adjusted basis.

"That $250,000 cap is now worth about $60,000 in today's dollars," Nader said.

He's been turning up the heat on Brown since last year, when the governor failed to get behind a ballot proposition that would have raised the malpractice cap to $1.1 million and adjusted it thereafter for inflation.

The initiative, Proposition 46, went down in flames after opponents — primarily doctors and malpractice insurers — spent $60 million fighting it.

Brown has said he signed the malpractice cap into law 40 years ago because insurance costs were rising and some doctors were finding it hard to afford.

In 1993, however, he said it had become clear that rising malpractice insurance premiums were the result of "insurance company avarice" and not, as the industry had claimed in the 1970s, soaring legal costs.

Brown acknowledged that the law "has revealed itself to have an arbitrary and cruel effect upon the victims of malpractice."

Nader said he's been in touch with Brown a number of times in recent years. Last month, he sent Brown a letter detailing his own nephew's experience with alleged malpractice and urging Brown to repeal or amend the state law.

"I've given him every argument why this law should be fixed," Nader said. "I point out that he's got a majority of Democrats in the Legislature. You know what he said? He said to me, 'Don't you have something better to do?'"

Evan Westrup, a spokesman for Brown, declined to comment on Nader's letter or why the governor hasn't stepped up to fix a law that he called "arbitrary and cruel" more than 20 years ago.

Carmen Balber, executive director of Santa Monica's Consumer Watchdog, said she and other activists statewide also have been blown off by Brown every time they've asked about the malpractice cap.

"We've received complete radio silence from the governor's office," she said. "It's a travesty."

Balber, like Nader, said it's easy to figure out what's happening. California's Democratic governor and its majority of Democratic lawmakers are terrified of squaring off against very wealthy, politically powerful business interests.

"The medical industry has tens of millions of dollars to spend on defending this law and to punish any lawmaker who steps out of line," she said.

Opponents of Prop. 46 included nearly every prominent medical group in California — more than 75 organizations representing doctors, dentists, pharmacists and hospitals. Insurance companies spared no lobbying expense.

Molly Weedn, a spokeswoman for the California Medical Assn., said changing the malpractice cap "would increase health costs for every consumer and dramatically reduce health access, especially in underserved and rural communities."

Hard to see how simply increasing the pain-and-suffering damages cap to keep pace with inflation would do that.

Maybe the medical association wouldn't mind explaining its stance to Annette Ramirez.

She's a South Bay mother of two who underwent a hysterectomy in 2012 and ended up losing her arms and legs because of infection after her colon was perforated during surgery. She spent nearly two years in the hospital and will require full-time care for the rest of her life.

Ramirez, 51, sued her hospital and eight doctors for malpractice. Details of a subsequent settlement are confidential, but she told me that she received "the full $250,000" permitted by California's law.

It barely addresses what she's been through.

"Imagine if you lost all your limbs and your livelihood," Ramirez said. "Imagine if you lost two years of your kids' lives. How can $250,000 ever be enough?"

It can't be enough. Ever.

And Gov. Brown knows that.

David Lazarus' column runs Tuesdays and Fridays. He also can be seen daily on KTLA-TV and followed on Twitter @Davidlaz. Send your tips or feedback to david.lazarus@latimes.com.