STATE LEGISLATIVE UPDATE

JULY 2002 STATE LEGISLATIVE UPDATE

As of the end of the month, the following state legislatures were in regular session or in recess: CA, MA, MI, NC, NJ, NY, OH, and PA. During July session adjourned in TN. Through July there have been 91,603 new bills introduced in the states (this does not include carry-over bills from last year) and 24,651 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.

NATIONAL CONFERENCE OF STATE LEGISLATURES (NCSL)

From July 25-27 the AAOS exhibited with nine other national medical specialty societies, the AMA and the American Osteopathic Association at NCSL in a booth entitled Physicians Advocating for Patients (as a quiz can you figure out the other nine groups: AAFP, AAN, AAO AAO-HNS, AAP, ACC, ACOG, ASA, and ASPS). The booth was a great success, attracting attention from legislators. They also appreciated interacting with the orthopaedic surgeons who volunteered at the booth and dazzled them with their encyclopedic knowledge of medicine. However, attendance was down from years past due to the budget problems hitting nearly all states.

The theme of the booth this year was "Will your Doctor Be There?" and each organization distributed a brochure on the professional liability insurance crisis hitting the United States. The response of the legislators generally was very positive about the need to enact some tort reforms to help the doctors in their state, though as to be expected others were only lukewarm.

Legislators were also able to see first hand the tactics of the plaintiff's bar in this war during a panel discussion on the crises in the states. On the panel were the Insurance Commissioner of West Virginia, a representative from the insurance industry, Dr. Palmisano, the President-Elect of the AMA (fresh off his appearance on Nightline) and a local plaintiff's attorney. The plaintiff's attorney brought a young boy confined to a wheelchair allegedly due to medical malpractice and then continued in high dudgeon and melodramatics the rest of the afternoon. His theatrics and highhandedness really turned off the legislators and made the physicians in the audience irate, but it also enlightened the legislators about what kind of nasty campaigns the lawyers will wage in their state if tort reform is on the agenda.

TORT REFORM

The huge news on tort reform technically happened a few hours into August when the Nevada legislature, in special session, passed a comprehensive tort reform bill. This was the culmination of months of work. Earlier in the year Gov. Kenny Guinn asked representatives from the insurance industry, the medical community and the trial bar to sit down and reach a compromise on legislation to address the professional liability insurance crisis.

Fuel was added to the fire earlier in July when the Level I trauma center at University Medical Center in Las Vegas had to close for ten days after 58 orthopaedic surgeons resigned from the center due to fears arising from the current liability culture in Southern Nevada. The doctors and lawyers began a public relations campaign that turned nasty with the lawyers' ad showcasing victims and questioning the doctors' commitment to the citizens of Nevada.

The doctors and lawyers could not reach agreement on bill language. The Governor, therefore, met with the legislative leaders and crafted his own bill. The bill was amended by the Senate during the special session. The final product contained a $350,000 cap on non-economic damages. The cap, though, has two exceptions, one for cases of gross negligence and, the other, if the judge decides by "clear and convincing" evidence that a greater award is justified.

The bill also contains a $50,000 cap on civil damages for physicians who treat "traumatic injuries" in a government hospital trauma center. The cap does not apply to gross negligence.

The bill also:

• Abolishes joint and several liability for non-economic damages
• Requires liability cases be brought to trial within three years (two years after 2005)
• Requires an affidavit of merit be filed with each suit
• Shortens the statute of limitations to 3 years after the act or 2 years after "the plaintiff discovers or through the use of reasonable diligence should have discovered the injury"
• Requires that expert witness testimony may only be provided by someone who practices in a specialty "substantially similar" to the defendant
• Makes mandatory sanctions for attorneys who file frivolous lawsuits and requires that they pay the defendant's costs and fees. The bill also requires any employee of a hospital or an ambulatory surgical center to report any sentinel events to the state via the facility's patient safety officer. These reports are confidential and "not subject to subpoena or discovery and not subject to inspection by the general public." In Florida trial lawyers are considering introducing a constitutional amendment to ban any physician from practicing in the state who has committed three acts of "malpractice." They will not introduce their amendment if physicians pull back from their effort to introduce an amendment to cap non-economic damages.

REIMBURSEMENT/PATIENT PROTECTION

Empire BC/BS in New York agreed to pay subscribers $21.6 million to compensate them for out-of-pocket expenses incurred due to faulty physician reimbursement methodology. BC/BS HMO patients in Arizona no longer need a referral to see a network specialist.