AAOS Bulletin - February, 2006

In Brief


A recent report found that those seeking to start specialty hospitals in California are hampered by a lack of state inspectors. Inspectors are needed to conduct initial inspections before a facility can be licensed. However, the state’s budget crunch has limited the number of inspectors, and their top priority is inspecting existing facilities—not licensing new ones. Inspections are some times delayed for up to a year, and this can result in hundreds of thousands of dollars in losses.


A new law requires that anyone applying to medical school in the state must undergo a criminal background check for violent felonies. An applicant with such a record isn’t necessarily forbidden from becoming a physician, but a school that rejects an applicant on that basis is immune from lawsuits.


A panel of state legislators assigned to find ways to address the medical liability crisis made recommendations for action in 2006. While members of both parties agreed that caps on noneconomic damages are unlikely this year, they supported “statement of sympathy laws,” as well as legislation requiring medical experts to sign off on the validity of medical liability claims earlier in the trial process. The panel also recommended that the state help specialty physicians pay for medical liability



The legislature, overiding the veto of the governor, passed a law that will require Wal-Mart (and other large companies) to increase their spending on employee health care. Wal-Mart has come under criticism for providing poor employee benefits and shifting health care costs onto state governments, with many employees relying on Medicaid for their health care needs.


More than one year ago, the Massachusetts Legislature created a commission to look into the feasibility of medical liability courts as well as a special task force charged with examining medical liability insurance problems in the state. Unfortunately, the commission and task force have been largely unsuccessful, perhaps because neither one has held a single meeting.


The state is planning to re-examine sections of the medical liability law to create clearer requirements for reporting cases. Currently, some of the state’s biggest hospitals have claimed that existing reporting requirements do not apply to them, resulting in a gap of more than 10 years in the state’s ability to track medical liability claims. The impetus for change stems from an Oregon surgeon who is currently under investigation for 13 patient deaths in Australia.


Two years ago the state passed a law to help fund trauma care. The law earmarked a percentage of money collected from fines levied against reckless or intoxicated drivers to go towards reimbursing trauma facilities. That program is in jeopardy because the Texas Speaker of the House, Tom Craddick (R), has said it would be fiscally irresponsible to use all the funds for trauma centers. Health care officials have stated that removing the funds from the trauma system could cause some hospitals to discontinue their trauma care.


A commission studying ways to address high medical liability insurance rates recently released a report concluding that caps on noneconomic medical liability awards would lower insurance costs for health care providers. However, the commission members were strongly divided on the issues, and the report did not directly urge the state to adopt caps.

West Virginia

At least three medical liability insurance carriers are looking to reduce their premiums as a result of reforms passed in the past five years. The state’s insurance commissioner gave a great deal of the credit to a law that requires a panel of physicians to sign off on medical liability suits before they can be filed. In 2003, West Virginia also passed a noneconomic damages cap of $500,000.


Governor Jim Doyle (D) has signed an executive order that will help develop an electronic health records system in the state. The governor said that electronic records will enable physicians to instantly access a patient’s history—including allergies, medications and previous test results—which can be helpful information in emergency situations.


A health care committee has voted in

favor of a bill to put a one-year moratorium on licensing specialty hospitals. Committee members said the moratorium is needed to allow time to study the possible effects of specialty hospitals. Two-thirds of the state’s legislature would have to agree to consider the measure before it could be voted on in the upcoming legislative session. Critics have suggested that the proposal is simply a way for hospitals to stifle competition.

This roundup was prepared by Bruce Allain, JD, a legislative analyst in the department of socioeconomic and state society affairs. He can be reached at Allain@aaos.org

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