Senate Bill No. 67 is bad public policy because, on the one hand, it is unlikely to perform as promised by the sponsors, but, on the other hand, it severely limits our rights to fair compensation for injuries or death perpetrated by negligent health care providers. Here is the key provision of the bill:

The damages awarded by a court or a jury under [c] of this section for all claims including a loss of consortium claim or other derivative claim arising out of a single injury or death may not exceed $250,000 regardless of the number of health care providers against whom the claim is asserted or the number of separate claims or causes of action brought with respect to the injury or death. [e] Multiple injuries sustained by one person as a result of a single course of treatment shall be treated as a single injury for purposes of this section.

So, no matter how many negligent, drunk, or impaired physicians, nurses, technicians, and medical assistants are responsible for the injury or death of you or your child, this “tort reform” bill limits the award to a quarter million dollars. No matter how much “pain, suffering, inconvenience, physical impairment, disfigurement, [or] loss of enjoyment of life” you, your loved one, or your child will suffer, this bill limits the award to a quarter million dollars.Why would anyone propose a bill like this, which severely limits the possibility of fair compensation for negligent, perhaps deadly, medical procedures? According to the authors of this bill:

…lowering the existing limits on noneconomic damages has proven to be the single most important tool in controlling the costs of malpractice insurance and ensuring its availability and lowering existing limits on noneconomic damages would be in the best interests of the state; the lower caps would encourage malpractice carriers to do business in the state by reducing their risk, making affordable insurance available to physicians, and thereby helping ensure that all Alaskans can find a qualified physician when they need one…

The problem with this explanation is that it is simply not supported by the facts. A recent article in the NYT reports:

For all the worry over higher medical expenses, legal costs do not seem to be at the root of the recent increase in malpractice insurance premiums. Government and industry data show only a modest rise in malpractice claims over the last decade. And last year, the trend in payments for malpractice claims against doctors and other medical professionals turned sharply downward, falling 8.9 percent, to a nationwide total of $4.6 billion, according to data compiled by the Health and Human Services Department. (Behind Those Medical Malpractice Rates, 2/22/05).

Furthermore, In June of 2002 the Wall Street Journal wrote about how market fluctuations and irresponsible price wars throughout the 1990’s forced the insurance industry to raise medical malpractice rates beginning in 2002. (Insurers’ Price Wars Contributed To Doctors Facing Soaring Costs, 6/24/02).

Finally, take a look at the analysis by Weiss Ratings, Inc., the widely respected and quoted “consumer advocate for financial safety” (and no relation to me –ldw). Weiss relies on national research to demonstrate that caps on non-economic damage did reduce payouts for the insurance industry, but insurance premiums continued to rise at a rapid rate in all states–the savings were not passed on to the providers who pay the premiums! In summary, Weiss concludes that:

Legislators should put proposals involving non-economic damage caps on hold until convincing evidence can be produced to demonstrate a true benefit to doctors in the form of reduced med mal costs. Regulators must review and revise their parameters for approving rate increases. Insurance companies must never again allow marketing to divert or pervert prudent actuarial analysis and planning. The medical profession must assume more responsibility for policing itself, while states must be more pro-active in reviewing the licenses of individual practitioners. And consumers must not relinquish their right to sue for non-economic damages until the medical profession and/or state and federal governments provide more adequate supervision and regulation of doctors, hospitals, and other health care providers.

To be sure, sage advice.

Lawrence D. Weiss