Congress finished its 2008 session without enacting any medical liability reform. Improving health information technology and electronic medical record systems should be part of the 2009 economic stimulus package.
Because there is little to report from the 110th Congress, what follows is a review of selected states.
— Leona Egeland Siadek, Vice President, Government Relations

California
The Doctors Company is vigorously defending the Medical Injury Compensation Reform Act (MICRA) against a state and federal constitutional challenge. In a brief filed last year, the appellant in Van Buren v. Evans alleges that MICRA infringes on the rights to a jury trial and to equal protection. Because MICRA is the national model for medical liability reform, any changes to its provisions could result in higher liability costs for all physicians.

In California in 2008 we also monitored dozens of liability-related bills that might have interfered with a physician’s ability to practice good medicine, but nearly all of the bills died or were vetoed. The continuing stalemate over the state’s budget limited legislative activity, and of those bills that did pass, more than 100 were sent back with the following message from the governor: “The historic delay in passing the 2008–2009 State Budget has forced me to prioritize the bills sent to my desk at the end of the year’s legislative session. Given the delay, I am only signing bills that are the highest priority for California. This bill does not meet that standard and I cannot sign it at this time.”

The 2008 election cycle featured a vacant assembly seat, a threatened recall of a state senator, controversial ballot measures, a presidential race, and a newly elected Speaker of the Assembly eager to increase her party’s majority. We met with and interviewed scores of candidates and contributed funds from California DOCPAC, The Doctors Company’s political action committee, to dozens of winning campaigns. DOCPAC also participated in a key senate race that was too close to call until weeks after the election. The elected senator is a MICRA supporter.

Colorado
The Doctors Company and the Colorado Medical Society were part of a team that killed a trial lawyer bill that would have raised the state’s $300,000 cap on noneconomic damages. Disguised as an inflationary adjustment, the bill changed the cap from per incident to per defendant by a subtle reference to another code section. The bill also sought to prohibit insurers— unless insolvent—from raising rates to account for resulting increased losses.

Separately, business interests and building industry advocates filed a ballot measure to limit attorney contingency fees. The personal injury lawyers filed a long list of ballot measures intended to harm their political foes, including a “three strikes” law to revoke physician licenses and a law making peer review records public. These measures were eventually withdrawn.

Florida
In Florida in 2008, Governor Charlie Crist appointed two judges with proven tort reform track records to fill vacancies on the Florida Supreme Court.

Raphael v. Schecter was filed. It will be the first appellate case to test the constitutionality of the 2003 caps on noneconomic damage awards in Florida.

The Doctors Company supported S.B.1012 (Gaetz), which reduces the amount of time from 30 to 12 months that managed care organizations can demand refunds from physicians for overpayments.

S.B.1012 was signed into law. Joining with the business community, The Doctors Company was successful in killing S.B.2076 (Deutch), a pro-trial lawyer measure that would have significantly altered Florida’s rules of arbitration.

Georgia
In Georgia in 2008, a number of medical liability reforms were nullified by court decisions. As the 2009 legislative session begins, Governor Sonny Perdue is seeking to work with the Republican-controlled state legislature to reenact a number of the judicially eroded reforms.

Ohio
In Ohio during the November 2008 general election, both state supreme court pro-tort reform justices supported by The Doctors Company were reelected.

In May, the court held the 2005 medical liability reform cap on noneconomic damages awards to be constitutional in Arbino v. Johnson & Johnson. In late December, the supreme court addressed the affidavit of merit requirement added by the reforms in Fletcher v. University Hospitals of Cleveland. Unfortunately, the court ruled that dismissal of a complaint for medical malpractice based upon the failure of the plaintiff ’s attorney to file the affidavit is without prejudice. This means that the plaintiff can continue with the complaint regardless of a timeline to file an affidavit.

During the 2008 legislative session, S.B.59 (Coughlin) did not move forward. It would have proposed a 10-year pilot project in designated Ohio counties to require mandatory arbitration of medical negligence claims prior to filing a complaint.

Oregon
In December 2007 the state supreme court in Clarke v. Oregon Health and Science University invalidated the Oregon limit on damages in suits against government entities. The decision means drastically increased exposure for schools, local governments, and Oregon Health and Science University (OHSU), which conducts teaching and research and operates hospitals and clinics throughout Oregon. OHSU predicts $30 million in program reductions to pay for increased liability costs.

Early in 2008, the legislature appointed a task force and held hearings, but no consensus emerged during the shortened session. After adjournment, OHSU and the personal injury lawyers made a deal to increase the cap from $200,000 to $1.5 million, but the legislature and governor have not yet enacted a new statute that finalizes the agreement.

Virginia
In Virginia in 2008, Governor Tim Kaine signed H.B.501, supported by The Doctors Company. It expands the definition of “professional services” covered by the medical liability reform statutes.

The Doctors Company successfully opposed H.B.1282, which would have severely limited flexibility during settlement negotiations with a medical malpractice plaintiff. The Doctors Company also weighed in successfully with the Medical Society of Virginia to limit the provisions of H.B.616 so that there is now a blanket one-year extension of the statute of limitations in cases that commence when a health care provider communicates a cancer diagnosis to a patient.

The trial lawyers have sponsored a senate bill in the 2009 session that would increase the total damage award cap. Details of that proposal are still being worked out.

Washington
The Doctors Company’s Washington DOCPAC helped the Liability Reform Coalition oppose H.B.1873, which would have dramatically increased damages for wrongful death. The bill threatened local governments and health care providers. The bill died, along with 30 other proposals advanced by the state’s personal injury lawyers.

What to Expect in 2009
President Obama has taken office in a period of great uncertainty and economic challenge. Having come to office on a platform of change, he is under tremendous pressure to address serious issues confronting our nation. We anticipate vigorous debates on Medicaid and Medicare reimbursements, health information technology, electronic medical records, and patient safety.

Last year, 24 state legislatures introduced over 80 bills dealing with medical liability tort reform. We will continue to vigilantly monitor legislative and judicial measures that affect physicians and to eliminate threats and seize opportunities.