Lobbying Efforts For and Against Limits on Malpractice Suit Awards Increasing

The New York Times on May 28 examines lobbying efforts at state and national levels by advocates and opponents of limits on medical malpractice lawsuit awards. Insurance companies and other businesses seeking to limit awards in medical malpractice lawsuits believe the current political climate is "friendly to their cause," according to the Times. For instance, the House in March passed a bill (HR 5) that would limit noneconomic jury awards in medical malpractice lawsuits at $250,000, and President Bush supports such reforms. Twenty state legislatures are considering medical malpractice legislation, and 11 states have already passed such bills this year. According to the Times, the bills, while different, include common elements such as caps on jury awards and elimination of joint and several liability, in which a defendant partially responsible for injury must pay the full award. At the state level, lobbying for limits on personal injury awards has "become intense," the Times reports. Many doctors have rallied in favor of limits on jury awards, while some hospitals have closed their obstetrics departments because of the high risk of lawsuits and price of malpractice insurance, according to the Times. In many states, trial lawyers, who generally oppose limits on jury awards, have begun "fierce counterattacks against coalitions of insurance companies, doctors and other businesses," such as advertising campaigns. Sherman Joyce, president of the American Tort Reform Association, said, "This is a year where we had seen considerable opportunity at the state level, and the major reason is the health care issue has been driving the agenda." But Mark Phenicie, legislative counsel for the Pennsylvania Trial Lawyers Association, said that malpractice awards are not the major factor driving up insurance costs, adding that "the stock market is low and interest rates are low, and insurance companies have to make their profits" by increasing malpractice coverage premiums. None of the lobbying groups would comment on how much money they have spent this year, the Times reports (Glater, New York Times, 5/28).

Attorneys Propose Lowered Fees
In related news, a group of attorneys in 13 states has introduced a proposal that would set limits on how much lawyers can collect in certain lawsuits, including medical malpractice suits, the New York Times reports. Under the proposal, plaintiffs' lawyers would be required to send a letter to the defendant describing the injury and why the defendant was allegedly responsible at the start of the case. Defendants would not be required to make a settlement offer, but if the parties reached a settlement, lawyers' fees would be capped at 10% of the first $100,000 of the settlement and 5% thereafter. The caps would be effective even if the plaintiffs' attorney does not send a letter at the start of the case, according to the Times. Proponents of the reform say it is unethical for lawyers to collect fees of up to one-third or more of a settlement. But critics say it is unnecessary to lower the fees in the current system. Common Good, an advocacy group, is filing petitions for the reform in Alabama, Arizona, California, Colorado, Maryland, Mississippi, New Jersey, New York, Ohio, Oklahoma, Texas, Utah and Virginia (Liptak, New York Times, 5/26).