October 2004 Bulletin

In Brief


Following a highly publicized battle in which a hospital tried to forbid the duly elected president of the medical staff from serving because he has a financial interest in a competing facility, the state legislature passed a bill delineating the rights of a medical staff. Under the legislation, medical staff has the right of self-governance that includes the powers to establish and enforce criteria and standards for medical staff membership. Medical staff can establish, in its own bylaws, rules or regulations, clinical criteria and standards to oversee and manage quality assurance, utilization review and other medical staff activities. Medical staff can select and remove medical staff officers. Medical staff can also assess and use staff dues. The legislation also prohibits a hospital from unreasonably withholding approval of changes to medical staff bylaws, rules and regulations. If there is a dispute, the medical staff and the hospital governing board must meet and confer in good faith to resolve the dispute.

Legislation also passed in both houses to allow physicians to sue payers for violations of the Prompt Pay Act. The physician must exhaust all contractual and administrative remedies available to him or her before bringing suit.

A bill mandating hospitals to use machines or specially-trained staff teams to lift heavy patients also passed. The “zero-lift policy” was sponsored by the California Nurses Association and would make it illegal for hospitals to ask employees to lift patients on their own. It’s an effort to prevent lift-related injuries, but many hospitals claim that it would be costly to comply with the law and could endanger patients. At the time of this writing, the bill was awaiting the governor’s signature.


Although medical liability reform was stalled in the state legislature, Illinois was the only state to pass osteoporosis-related legislation. The bill mandates insurance coverage for medically necessary bone mass measurements. The bill also mandates that health insurers cover the diagnosis and treatment of osteoporosis on the same terms and conditions that are generally applicable to coverage for other medical conditions.

New Jersey

The first payment of a new New Jersey state tax on certain ambulatory surgical centers was due Oct. 1. Payments are required quarterly and are based on 3.5 percent of gross revenues for the previous year (in this case, 2003). The tax applies to facilities with more than $300,000 annual revenue but does not cover facilities licensed to hospitals in the state. A 6 percent tax on cosmetic surgeries went into effect on Sept. 1. The new taxes are designed to help hospitals cover more of the cost of care provided to uninsured patients. Physicians are concerned that the laws set a precedent for taxing specific procedures. For more information: http://www.ama-assn.org/amednews/2004/09/13/bisb0913.htm


A medical liability reform initiative will appear on the November ballot. The Nevada Supreme Court rejected a suit filed by several groups that wanted to keep the measure off the November ballot. The “Keep Our Doctors in Nevada” question seeks to limit fees paid to a plaintiff’s lawyer, permit doctors’ attorneys to present evidence of other compensation to the victim and provide for periodic payments. The proposal also would eliminate joint-and-several liability in a medical liability lawsuit. The November ballot also contains two measures proposed by trial lawyers: one that would repeal the current $350,000 cap on awards if malpractice premiums are not been lowered by at least 10 percent and one that would restrict the Legislature from enacting laws that would limit a victim’s damages in a suit involving negligent or wrongful acts.

North Carolina

Legislation providing that “statements by a health care provider apologizing for an adverse outcome in medical treatment, offers to undertake corrective or remedial treatment or actions, and gratuitous acts to assist affected persons shall not be admissible to prove negligence or culpable conduct by the health care provider” was signed into law. Similar legislation has recently been enacted in Ohio, Oregon and Colorado.


Oregon physicians are campaigning on behalf of Measure 35, which would amend the state constitution to limit noneconomic damages in medical liability lawsuits to $500,000. A similar measure was rejected four years ago, but proponents of Measure 35 point out that it is much more limited than the previous proposal. Studies indicate that Oregon has the nation’s fourth-highest medical liability insurance rate and a growing share of damage awards are higher than $1 million.


Doctors across the state are asking patients to sign a petition favoring medical liability reform. They have launched a campaign for Initiative 330 (I-330), which would cap noneconomic damages in medical liability lawsuits at $350,000. For the last two years “cap” legislation has passed in the Senate, only to die in the House of Representatives. The physicians need to gather 197,734 valid signatures by the end of the year to force the legislature to approve the initiative or put it on the ballot in 2005 and let the voters decide.


A campaign is underway to pass a constitutional amendment allowing the legislature to enact a cap on noneconomic damages. Because the amendment needs to get a majority of all people going to the polls, not just a majority of all people voting on that issue, a non-vote equals a no vote.

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