Tort reform passes in Ohio, but there's no immediate relief
Physicians believe the third time will be the charm when
it comes to reforms withstanding a state constitutional challenge.
By
Tanya Albert, AMNews staff. Jan.
13, 2003. Additional information
As the legislative season drew to a close, Ohio became the
fourth state to pass tort reform last year in an effort to stabilize the
medical liability insurance market for physicians, who are increasingly
unable to afford their premiums.
The measure would cap noneconomic damages and shorten the time that
patients have to file a lawsuit. Ohio doctors see it as just the beginning
of changes that are needed to bring down premium increases, which have
averaged 40% there during the past two years.
They say more must be done to stop physicians from continuing to retire
early, giving up high-risk procedures or moving to states with lower
medical liability premiums.
"We're calling this a first step," said Tim Maglione, senior director
of government relations for the Ohio State Medical Assn.
Ohio liability insurance premiums rose an average of 40% in the past
2 years.
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Maglione noted that this reform package is stronger than one passed in
the 1990s that the Ohio Supreme Court found unconstitutional.
Ohio is one of 12 states the American Medical Association identified in
2002 as being in a medical liability crisis in which physicians can't
afford insurance or can't find a company willing to insure them. By
passing tort reform -- which at press time was expected to be signed by
the governor -- Ohio joined Mississippi, Nevada and Pennsylvania as crisis
states that approved tort reform in 2002.
The Ohio measure would:
- Place a $350,000 cap on noneconomic damages for each victim in most
cases and an additional $150,000 limit for claims that a spouse or child
might bring for loss of companionship.
- Put a $500,000 cap on noneconomic damages for each victim in
catastrophic injury cases -- the most egregious cases of medical
malpractice, such as loss of limb. Death is not included because Ohio
has a separate law that prohibits caps in wrongful death cases. There's
an additional $500,000 limit for claims that a spouse or companion might
bring.
- Allow judges to review what an attorney is paid.
- Prohibit lawsuits against physicians beyond four years after the
incident occurred, even if the injury was not discovered until later. An
exception would be made for minors and "persons of unsound mind."
- Give a defendant the right to ask the court to review a medical
malpractice lawsuit and determine whether there is a "good faith basis"
for the claim. If the court says no, the plaintiff has to pay the
defendant's legal costs.
- Allow the jury to know how much money a plaintiff received from
insurance companies and other sources.
- Let physicians pay damages of more than $50,000 over time, rather
than in one lump sum.
- Hold physicians responsible only for the portion of damages for
which they are liable.
Trial lawyers opposed the bill and are disappointed that it passed.
"It will cause some individual victims of medical malpractice to be
undercompensated or not compensated," said Richard Mason, executive
director of the Ohio Academy of Trial Lawyers.
Physicians respond
The Ohio bill -- the result of down-to-the-wire compromises between the
state's House and Senate as the term wound down -- won't mean immediate
relief for physicians.
Brian Bachelder, MD, a family physician from Mount Gilead, will still
have to give up the obstetrics part of his practice. His 2003 premium as a
family physician performing 30 deliveries would have been $57,000.
"I was afraid to ask what it would cost if I did the 31st delivery,"
said Dr. Bachelder. He would pay $8,000 next year if he drops obstetrics
and buys $110,000 tail coverage.
Ohio law prohibits damage caps in wrongful death cases.
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His patients, some of whom have trouble affording gas to make the drive
to his local office, will have to travel 50 to 60 miles for prenatal care
because he is the only physician delivering babies in Morrow County.
Dr. Bachelder, president of the Ohio Academy of Family Physicians, said
he was disappointed that the legislation would create a cap higher than
the $250,000 limit adopted in California in the mid-1970s and that it
doesn't automatically limit attorney fees. He hopes that the state will
adopt more reforms that stop frivolous cases from being filed.
"There's a lot more work to be done," Dr. Bachelder said.
Insurance rates are influenced by how much a company has to pay out in
settlements and awards in a particular geographic area, said Frank O'Neil,
spokesman for Medical Assurance Co., which writes professional liability
policies for physicians in Ohio and other states in the Midwest and
Southeast. Consequently, tort reform doesn't result in immediate drops in
rates.
What tort reform provides -- particularly jury award caps -- is
predictability that allows insurance companies to establish stable rates
in the future.
"When the loss environment becomes unpredictable, you have to price for
the worst case," O'Neil said.
Also, before insurance companies adjust their premiums, they will wait
to see if the tort reform package is challenged in court and whether it is
upheld, he said.
Passing legal muster
This is the third time the Ohio Legislature passed tort reform. The
state's Supreme Court found 1991 and 1996 laws unconstitutional.
The Ohio Academy of Trial Lawyers has no plans to challenge the
measure's constitutionality, Mason said.
A legal challenge by someone, though, is practically inevitable.
Ohio's tort reform measure includes damage caps and time limits for
filing suit.
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And if that happens, the OSMA expects the Ohio Supreme Court will rule
differently. In 1999, the last time the court ruled on the issue, it found
the tort reform package unconstitutional by a 4-3 vote. In November 2002,
one of the judges who sided against the law was replaced with a judge who,
because of her judicial philosophy, is more likely to find the tort reform
package constitutional.
Also, the legislation attempts to address the concerns the previous
court raised.
"We're confident it will withstand a constitutional challenge,"
Maglione said.
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ADDITIONAL INFORMATION:
Crisis takes its toll
Among Ohio physicians:
96% are concerned about the impact of rising professional
liability insurance rates on patients' access to care.
83% report an increase in premiums during the past two years.
72% in high-risk specialties say insurance premiums have affected
their willingness to perform high-risk procedures.
34% order more tests or consultations, practicing defensive
medicine.
Source: Ohio State Medical Assn. survey of 432 physicians
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Copyright 2003 American Medical Association. All
rights reserved.
