Health Coalition on Liability and Access

Across the nation, patients can’t get the care they need, when they need it, because abuse of our medical liability system is driving good doctors out of the practice of medicine. This national crisis requires a federal solution, so that American patients nationwide have access to quality, affordable medical care.

The HCLA’s proposals for federal reform are largely based on California’s successful Medical Injury Compensation Reform Act (MIRCRA). The proven reforms enacted under MICRA in 1975, effectively overhauled California’s then-out-of-control medical liability system, safeguarding patients’ access to care and ensuring prompt and fair payment to those injured and in need.

The recent reforms adopted in Texas, under 2003’s constitution amendment, Proposition 12 (Prop. 12), have also proven to be successful and provide another example of the effectiveness of reform measures, such as reasonable limits on non-economic damages.

Key provisions of HCLA’s reforms include:

PRESERVING HEALTH CARE ACCESS BY RESTORING STABILITY AND PREDICTABILITY TO THE MEDICAL LIABILITY SYSTEM - HCLA's reforms would guarantee FULL and UNLIMITED recovery of a patient's economic damages, including medical expenses, lost wages, rehabilitation costs, future earning potential, lost use of property, costs of repair or replacement, etc. These reforms would reasonably limit only the NON-economic portion of an award to a quarter of a million dollars -- fair and equitable compensation to patients above and beyond their actual losses.

Result:

Reasonable limits on non-economic damages preserves everyone's access to care by stabilizing the insurance market, once again making medical liability premiums affordable, and allowing health care practitioners to get the coverage they need to provide patients with readily accessible and quality medical care. Since Texas enacted limits on non-economic damages in 2003, the state has seen 12 significant rate reductions, the financial burden on physicians has been eased by an average 14 percent drop in premiums, and more insurers have entered the market offering coverage. (Texas Department of Insurance, 2006) In the same time period, 3,000 new physicians have moved to Texas, including hundreds of highly trained specialists, such as obstetricians, orthopaedists, neurosurgeons, and emergency physicians, who, prior to reform, had been fleeing the state in droves. (Texas Medical Board)
Reasonable limits on non-economic damages do not affect a plaintiff's ability to be fully compensated for economic damages -- medical expenses, lost wages, etc. Under MICRA, California juries can and have awarded large verdicts for seriously injured patients. In December 2002, an Alameda County jury awarded a 5-year-old boy more than $84 million in damages for injuries related to delayed treatment of jaundice after birth. In July 2002, a Los Angeles jury handed down a $12.5 million judgment to a 30-year-old homemaker who suffered brain damage during surgery. (Californians Allied for Patient Protection)

AWARDING MORE MONEY TO PATIENTS, NOT LAWYERS- HCLA supports a limit on lawyers' contingency fees. An attorney should be able to keep no more than 40 percent of the award's first $50,000, 33.3 percent of the next $50,000, 25 percent of the next $500,000, and 15 percent of any awards exceeding $600,000.

Result:

The most seriously injured patients keep more of the damages they are awarded.
Lawyers are encouraged to take cases for smaller damages, thus providing increased access to the court system -- the original reason for establishing the contingency-fee system.  
According to the Medical Insurance Exchange of California's 1998 Large Loss Trend Study, from 1994-1998 as a result of California's medical liability reforms, more than $77 million in high damage awards was redirected from lawyers to patients.

ENSURING PATIENTS' LONG TERM NEEDS ARE MET- HCLA supports periodic payment of damages. Past and current expenses/losses are now paid in full at the time of judgment or settlement. HCLA proposes that all future losses and costs over $50,000 -- damages such as lost wages or anticipated future medical expenses -- are paid in installments.

Result:

Periodic payments ensure that the money will be there when it's needed.
Periodic payments allow the injured patient to receive more of the award and makes sure the attorneys pocket less.
Periodic payments contribute to the stability of insurance premiums.

ASSIGNING RESPONSIBILITY BASED ON FAULT, NOT "DEEP POCKETS"- HCLA supports joint and several liability reform. HCLA proposes that defendants remain jointly liable for all economic losses and costs, but are responsible for only their share of the damages for pain and suffering.

Result:

Joint and several liability reform prevents plaintiffs' lawyers from seeking out “deep pockets” and discourages the proliferation of lawsuits against those minimally liable or not liable at all.
Joint and several liability reform helps encourage all health care providers and volunteers to offer their much-needed services without fear of becoming targets for lawsuits.

HALTING DOUBLE RECOVERY- HCLA supports collateral source reform. In cases where plaintiffs sue for medical expenses and loss of income, HCLA's reform proposal allows doctors and insurance companies to inform juries if expenses have already been paid by an insurance company, workers’ compensation, or disability payments.

Result:

Reform of the collateral source rule prevents multiple parties from paying plaintiffs for the same loss.
Reform of the collateral source rule allows plaintiffs to be fully and equitably compensated, but prevents the escalation of awards.
Reform expedites settlement of legitimate cases.
Before 1975, California faced these same problems. MICRA helped solve them. (Please go to "data and resources" to read about this and more.)

Bottom Line: It's time for the U.S. Congress to enact commonsense reforms that safeguard patients' access to care while preserving their access to the courts.

HCLA supports reform that's best for patients not lawyers.