STATE LEGISLATIVE UPDATE

December, 2002 STATE LEGISLATIVE UPDATE

As the year comes to a close I hate to keep returning to the same theme, but as most state legislatures convene in January they will all be weighing the same quandary: How on earth do we raise enough revenue or cut enough spending to balance our rapidly ballooning budget deficit? The National Governors Association (NGA) found that state budgets were unbalanced by $50 bilion in 2002 and are predicted to be $40 billion in the hole in 2003. It is predicted that in 2003 California's deficit alone could hit $34.8 billion. Leading the way as a cost center for state governments is health care and Medicaid which make up roughly 33% of state budgets. The cost of health care rose by 13% this year (much higher than the rate of inflation).

As of the end of the month, the following state legislatures were in regular session or in recess: IL, NJ, and OH. Through December there have been 108,585 new bills introduced in the states (this does not include carry-over bills from last year) and 28,953 have become law.

Some of the bills the Department of Health Policy is tracking are outlined below. If you have any questions please give Jay Fisher a call at 800-346-2267, x4336.

TORT REFORM

The Ohio legislature, in lame duck session in December, passed two tort reform bills addressing the medical liability insurance crisis. These bills are awaiting action by the Governor. The first abolishes joint and several liability for non-economic damages and provides that if one defendant is found to be more than 50% at fault he or she is jointly and severally liable for the economic damages (lost wages, medical bills etc.). If a defendant is found to be less than 50% at fault he or she is only responsible for their proportionate share of the economic damages.

The second bill is a comprehensive tort reform bill. The bill creates a four-year statute of repose from the date of injury, in addition to the one-year statute of limitations. A statute of repose puts a hard cap on when a plaintiff can sue while a statute of limitations starts when the plaintiff "discovers" an injury. The bill allows periodic payments of future damages over $50,000. It also allows introduction of evidence of collateral sources of recovery by the plaintiff.

The bill institutes a cap on non-economic damages of "$250,000 or an amount equal to three times the plaintiff's economic loss . . . to a maximum of $350,000 for each plaintiff or a maximum of $500,000 for each occurrence." This means that if there is more than one plaintiff the most they can receive jointly in non-economic damages is $500,000. If the plaintiff's injuries are "permanent and substantial physical deformity, loss of use of a limb, loss of a bodily organ system, or permanent physical functional injury that permanently prevents the plaintiff from being able to independently care for self and perform life sustaining activities" then the limit is $500,000 to one plaintiff and $1,000,000 for all the plaintiffs.

A tort reform bill passed one house in New Jersey. The bill, supported only by Democrats, contains no cap on damages and no reform of the statute of limitations. It requires 180 days notice to the physician before a suit can be filed and also requires mediation of all liability actions by a single mediator. The bill requires expert witnesses to practice in the same specialty or sub-specialty as the defendant (and hold the same board-certification). The judge can waive this requirement.

The bill also allows non-economic damage awards over $1,000,000 to be paid out periodically over 60 months. The bill also sets up a loan program for physicians to help pay their liability insurance premium (if they are in a high-risk specialty and their premium increased by 30% or more and is more than $50,000). The evenly divided Senate has bogged down on how to best address the growing medical liability insurance crisis.

SCOPE OF PRACTICE

A bill was signed into law in Michigan that makes clear that only chiropractors can perform chiropractic adjustments and manipulations. The bill was amended to state that this language does not affect the scope of practice of osteopathic physicians and medical doctors.

A bill passed out of the Senate in New Jersey allowing direct access to Physical Therapists by patients. The Orthopaedic Society, the Medical Society and the Academy of Physical Medicine and Rehabilitation successfully amended the bill to require:

• that physical therapy regulations be written in collaboration with the N.J. Board of Medical Examiners,
• a Physical Therapist to immediately refer an individual to a physician if that individual shows signs of a condition beyond the scope of physical therapy including, but not limited to, nonmuscular and nonskeletal conditions, and conditions of the central nervous system, and
• a Physical Therapist to refer all individuals who have not shown reasonable progress within thirty days, and the PT must consult with that individual's physician after thirty days as to the appropriateness of physical therapy.

PATIENT SAFETY

The New Jersey Governor signed into law a bill creating a searchable physician profile. This bill provides that each physician or podiatrist profile contain the following information:

• A description of any criminal convictions within the most recent 10 years;
• A description of any final Board of Medical Examiners disciplinary actions and any final disciplinary actions in other states within the most recent 10 years;
• A description of the revocation or involuntary restriction of privileges, or the resignation from or nonrenewal of medical staff membership for reasons related to the practitioner's competence or misconduct or impairment, and
• All medical liability court judgments and arbitration awards, in which a payment has been awarded to the complaining party during the most recent five years, and all settlements of medical malpractice claims, in which a payment is made to the complaining party within the most recent five years. The number and amount of awards will be labeled average, below average or above average based on each physician's specialty and a statement will be included noting that payment does not automatically equate with actual malpractice.