STATE LEGISLATIVE UPDATE

MARCH 2003 STATE LEGISLATIVE UPDATE

As I have been emphasizing for the last few months, state legislators are trying to deal with the huge budget deficits in the states. Unfortunately, the deficits seem to be growing larger. According to a recent study by the National Conference of State Legislatures the combined budget deficit among the states in fiscal year 2004 will be about $70 billion. Twenty four states are considering tax hikes and nine states have already laid off workers. At least seventeen states are facing budget deficits greater than 10% of their budget. The outlook continues to look grim.

As of the end of the month, the following state legislatures were in regular session or in recess: AK, AL AR, AZ, CA, CO, CT, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, NC, ND, NE, NH, NV, NY, OH, OK, OR, PA, RI, SC, TN, TX, VT, WA, and WI. The legislatures in NM, SD, UT, WV and WY adjourned in March. Through February there have been 133,503 new bills introduced in the states and 12,400 have become law.

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

TORT REFORM

March was a busy month for tort reform. H.B. 1038 was signed into law in Arkansas. The bill caps punitive damages at $250,000, or three times compensatory damages not to exceed $1,000,000, whichever is greater. Joint and several liability was also eliminated, unless within 10 days it can be shown that one of the defendants will be unable to pay their fair share.

A tort reform bill was also signed by the Governor in Idaho. The bill lowers the cap on non-economic damages to $250,000. Under existing law the cap was $682,000 (it started out in 1987 at $400,000 and was indexed to inflation). Punitive damages are also capped at $250,000 or three times compensatory damages, whichever amount is greater.

The state Senate in New Jersey passed a version of tort reform. Unlike the version passed in the Assembly, the Senate bill has a cap on damages. The cap on non-economic damages for physicians would be $300,000. The bill would create a state fund that would pay up to $700,000 more in non-economic damages to the plaintiff.

The opposite situation occurred in Florida where the House passed a bill with caps while the Senate is the stumbling block. The House bill passed 95-19 and would set a $250,000 cap on non-economic damages. The Senate committee voted 10-1 against the bill that contains the $250,000 cap. Over 2,000 physicians and supporters rallied at the state capitol to ask the Senate to support comprehensive tort reform.

In Washington the Senate passed a bill that would cap non-economic damages at $350,000. The bill would also institute a maximum three year statute of repose for filing suit with a few exceptions for fraud and minors.

A tort reform bill passed the Senate in Georgia, but not before the cap on non-economic damages was deleted from the bill. The bill was sponsored by Majority Leader Tom Price, who is an orthopaedic surgeon. As passed, the bill toughens requirements for physicians who serve as expert witnesses in medical liability cases.

The tort reform bill in West Virginia was signed into law. The bill lowers the cap on non-economic damages from $1,000,000 to $250,000. If the plaintiff suffered a serious injury and cannot care for himself the cap is $500,000. The bill also places a cap of $500,000 on all damages in trauma cases. The legislation authorizes the creation of a physician mutual insurance company that will replace the state provided insurance of last resort. The bill also allows physicians to get a tax credit based upon the amount of the liability insurance premiums that they pay.

A tort reform bill was introduced in the North Carolina House that includes a $250,000 cap on non-economic damages. More than half of the Representatives have co-sponsored the bill. A tort reform bill passed the House in Texas. The bill would cap non-economic damages at $250,000 per plaintiff and institute a statute of repose of ten years, so all cases must be brought within 10 years from the alleged negligence. The bill also tightens expert witness rules.

SCOPE OF PRACTICE

The PT direct access bill in Wyoming was signed by the Governor. The direct access bill in Ohio passed out of the Senate. Direct access bills were introduced in Louisiana and Connecticut. A bill to allow direct access to occupational therapists for prevention, wellness and educational activities was introduced in Louisiana. The PT direct access bill in Illinois failed to make it out of committee by the deadline, but could be amended into another bill later in the session.

A bill was introduced in New York to allow podiatrists to treat "up to the malleoli" (in other words, the ankle). Another bill in New York would allow podiatrists to be certified as acupuncturists. A bill introduced in Texas would define the foot as "the portion of a lower limb situated below the ankle joint."

Bills in Illinois to allow chiropractors to perform school physicals advanced in March.

PATIENT PROTECTIONS

The U.S. Supreme Court in Kentucky Association of Health Plans v. Miller unanimously decided that a state may enact "any willing provider" laws. The health insurers had argued that ERISA prevented states from enacting such laws. "Any willing provide" laws prohibit an insurer from discriminating against any provider who agrees to abide by the plan's terms.

A bill was introduced in Louisiana to require that an insurer "which provides coverage for diagnostic, medical, or surgical treatment of any bone or joint disorder shall provide coverage for all joints and bones of the body on the same terms and conditions." A bill was introduced in Texas requiring direct access to specialist physicians without a PCP referral.