Medical Malpractice Damage Caps Ruled Unconstitutional

With the increase in health care costs, much discussion has been held regarding the impact of medical malpractice cases upon the cost of health care. Medical malpractice insurers repeatedly argue that medical malpractice lawsuits are driving up the cost of liability insurance for the doctors and hospitals, which in turn force doctors to practice elsewhere or quit practicing all together. Medical malpractice insurers also argue that the increased cost in liability insurance must be passed on to the patient, thus driving up the cost of health-care. Numerous studies on this issue have shown that caps on medical malpractice awards do not impact the cost of health care or malpractice insurance. Despite the “medical malpractice” crisis, insurers continue to report record profits.

Recently, Oregonians narrowly rejected a ballot measure which capped damages in medical malpractice cases. As indicated by the article below, similar caps have been ruled unconstitutional in other states. What proponents of damage caps fail to recognize is that medical negligence continues to cause severe injury and death resulting in millions of dollars in economic loss for future medical care and lost wages without even addressing pain and suffering caused by such negligence. Civil jury trials are the only method by which injured parties can seek compensation. Damage caps bind the hands of juries to administer justice thereby nullifying the jury system.

Judge rules malpractice law unconstitutional
By Adam Jadhav

Reopening a statewide political controversy, a Cook County judge ruled today that limiting how much a doctor or hospital could be forced to pay in a medical malpractice suit is unconstitutional. MORE
Download a 10-page PDF of the judge’s decision

The judge’s ruling strikes down landmark medmal litigation reform legislation enacted by the legislature in 2005. Supporters said the reforms were necessary to curtail massive lawsuit awards that insurance companies blamed for rising insurance costs. Critics said the lawsuits were the scapegoat as insurance companies tried to justify profits.

The law contained a package of reforms, including rules aimed at opening the medmal insurance industry to competition and allowing the state to deny excessive malpractice insurance rate increases. State officials and even some insurance companies say those changes are working.

But the most embattled provision capped noneconomic damages — so-called pain and suffering awards — at $500,000 for doctors and $1 million for hospitals. Almost immediately both trial lawyers and tort reform groups predicted that portion of the law would be challenged.

The constitutional challenge came in a 2006 Cook County lawsuit alleging a that a botched delivery left an infant with severe brain damage. Judge Joan Larsen ruled Tuesday that the caps violate the constitution by allowing the legislature control over a judge’s ability to award damages.

Though Larsen only ruled on the constitutionality of the damage caps, she struck down the entire law.

Groups representing insurers, physicians and hospitals were all quick to denounce the ruling as bad for Illinois doctors and patients. Meanwhile consumer groups and trial lawyers praised the decision as removing an unfair limitation on the civil justice system.

Supporters of the law vowed to appeal though the state Supreme Court has struck down similar damage caps in the past.