Looming Medical Malpractice Issues

1
Looming Medical Malpractice Issues

• Leadership Conference
• Hilton Capitol Center
• Saturday, February 22, 2008

2
The Cap

• La. R.S. 401299.42(B).
• B.(1) The total amount recoverable for all
  malpractice claims for injuries to or death of a
  patient, exclusive of future medical care and
  related benefits as provided in R.S. 401299.43,
  shall not exceed five hundred thousand dollars
  plus interest and cost.
• A health care provider qualified under this Part
  is not liable for an amount in excess of one
  hundred thousand dollars plus interest thereon
  accruing after April 1, 1991, for all malpractice
  claims because of injuries to or death of any one
  patient.
• (3)(a) Any amount due from a judgment or
  settlement or from a final award in an
  arbitration proceeding which is in excess of the
  total liability of all liable health care
  providers, as provided in Paragraph (2) of this
  Subsection, shall be paid from the patient's
  compensation fund pursuant to the provisions of
  R.S. 401299.44(C).
• (b) The total amounts paid in accordance with
  Paragraphs (2) and (3) of this Subsection shall
  not exceed the limitation as provided in
  Paragraph (1) of this Subsection.

3
La. Const. art. I, sec. 3

• 3. Right to Individual Dignity.
•  
• Section 3. No person shall be denied the equal
  protection of the laws. No law shall
  discriminate against a person because of race or
  religious ideas, beliefs, or affiliations. No
  law shall arbitrarily, capriciously, or
  unreasonably discriminate against a person
  because of birth, age, sex, culture, physical
  condition, or political ideas or affiliations.
  Slavery and involuntary servitude are prohibited,
  except in the latter case as punishment for
  crime.

4
Regarding heightened equal protection scrutiny
of caps, the Supreme Court of Louisiana has
stated

• Article I, Section 3 commands the courts to
  decline enforcement of a legislative
  classification of individuals in three different
  situations (1) When the law classifies
  individuals by race or religious beliefs, it
  shall be repudiated completely (2) When the
  statute classifies persons on the basis of birth,
  age, sex, culture, physical condition, or
  political ideas or affiliations, its enforcement
  shall be refused unless the state or other
  advocate of the classification shows that the
  classification has a reasonable basis (3) When
  the law classifies individuals on any other
  basis, it shall be rejected whenever a member of
  a disadvantaged class shows that it does not
  suitably further any appropriate state interest.
  With the adoption of these guarantees Louisiana
  moved from a position of having no equal
  protection clause to that of having three
  provisions going beyond the decisional law
  construing the Fourteenth Amendment.
• Sibley v. L.S.U. Board of Supervisors, 477 So.2d
  1098, 1107-1109 (on rehearing) (La. 1985).

5

• The statutory prohibition against a malpractice
  judgment in excess of 500,000 dollars classifies
  individuals because of their physical condition.
  The law on its face is designed to impose
  different burdens on different classes of persons
  according to the magnitude of damage to their
  physical condition. The statute creates two
  classes one, a group of malpractice victims each
  of whom has suffered damage that would oblige a
  defendant under our basic law to repair it by
  paying in excess of 500,000 dollars another, a
  class consisting of victims whose damages would
  not require an award over this amount to make
  individual reparation. Victims in the former
  class are prevented from recovering for all their
  damage, while those in the latter class are
  allowed full recovery. Damage to the physical
  condition of each malpractice victim is the
  primary element of his damage and a primary cause
  of his being assigned to one of the two classes.
  Thus, the statutory classification disadvantages
  or discriminates against one class of individuals
  by reason of or because of their physical
  condition.
• Sibley v. L.S.U. Board of Supervisors, 477 So.2d
  1098, 1107-1109 (on rehearing) (La. 1985).

6

• Jane Sibley clearly fits within the class of
  individuals disadvantaged by the statutory
  classification. Accordingly, the state or the LSU
  Board is obliged to show that there is a good
  reason for the statutory classification, that is,
  that the legislative classification substantially
  furthers a legitimate state purpose.
• Sibley v. L.S.U. Board of Supervisors, 477 So.2d
  1098, 1107-1109 (on rehearing) (La. 1985).
  

7
La. Const. art. I, sec. 22

• 22. Access to Courts
• Section 22. All courts shall be open, and
  every person shall have an adequate remedy by due
  process of law and justice, administered without
  denial, partiality, or unreasonable delay, for
  injury to him in his person, property,
  reputation, or other rights.

8
Regarding adequate remedy guarantees, the Supreme
Court of Louisiana has stated

• From this history, we conclude that in adopting
  art. 1, 22, the Constitutional Convention did
  not intend to limit the legislature's ability to
  restrict causes of action or to bar the
  legislature from creating various areas of
  statutory immunity from suit.
• The constitutional guarantee providing for open
  courts and insuring a remedy for injuries does
  not warrant a remedy for every single injury it
  applies only to those injuries that constitute
  violations of established law which the courts
  can properly recognize.
• We interpret art. 1, 22 to be a mandate to
  the judiciary of this state rather than a
  limitation on the legislature. Article 1, 22
  guarantees that the courts will be open to ensure
  an adequate remedy by due process of law
  however, where, as here, a person has no cause of
  action that is a vested property right, this
  constitutional provision affords no substantive
  relief.
• Crier v. Whitecloud, 496 So.2d 305, 309-310 (on
  rehearing) (La. 1986).
  

9

• La. Const. art. I, sec. 2
•  
• 2. Due Process of Law
•  
• Section 2. No person shall be deprived of
  life, liberty, or property, except by due process
  of law.
  
• La. Const. art. V, sec. 1
•  
• 1. Judicial Power.
• Section 1. The judicial power is vested in
  a supreme court, courts of appeal, district
  courts, and other courts authorized by this
  Article.

10
In 1992, the Supreme Court of Louisiana found the
cap constitutional

• As an offset to the Acts 500,000 limitation,
  Louisiana now offers most severely injured by
  medical malpractice three benefits (1) greater
  likelihood that the offending physician or other
  healthcare provider has malpractice insurance
  (2) greater assurance of collection from a
  solvent fund (3) payment of all medical care
  and related benefits. Compensation and full
  medical care for those grossly injured by medical
  malpractice are legitimate social interests,
  which are furthered by the malpractice
  legislation. The discrimination in the Act
  against those with excessive injuries is
  accompanied by a quid pro quo a reasonable
  alternative remedy has been provided. See
  Bazley. Since the legislatures statutory
  solution to the medical malpractice problem
  furthers the states purpose of compensating
  victims, it is not constitutionally infirm.
• Overall, the Louisiana Medical Malpractice Act
  represents a reasonable but imperfect balance
  between the rights of victims and those of
  healthcare providers. It does not violate the
  state or federal constitutions. (Underlining
  added.)
• Butler vs. Flint Goodrich Hospital, 607 So.2nd
  517, 521 (La. 1992), cert. den., 508 U. S. 909,
  113 S.Ct. 2338, 124 L. Ed.2d 249 (1993).

11
Arrington v. Galen-Med, Inc. and Taylor v.
Clement

• 2 Grounds
• 1. The value of the cap has gone down -
  500,000.00 in 2003 worth only 160,000.00 in
  1975 dollars.
  
• 2. The statutory admission of liability provided
  at the MMA has been eroded.
  
• La. R.S. 401299.44(C)(5)(e)
• (e) In approving a settlement or determining the
  amount, if any, to be paid from the patient's
  compensation fund, the trier of fact shall
  consider the liability of the health care
  provider as admitted and established where the
  insurer has paid its policy limits of one hundred
  thousand dollars, or where the self-insured
  health care provider has paid one hundred
  thousand dollars.

12
The Judge in Arrington and Taylor found the cap
constitutional, but stated

• The erosion of the only benefits to the
  plaintiffs liability being admitted against
  the Fund once the health care provider had
  settled with the patient and the fact that the
  cap amount of 500,000.00 which was created in
  1975 is now eroded to approximately 160,000.00
  in todays dollar value. This means that the Act
  is no longer giving the equal quid pro quo to
  the plaintiff and has eroded their rights to the
  point where they have none. This should
  addressed by the legislature.

13

• The plaintiffs appealed to the Court of Appeal,
  Third Circuit, which found the statute
  unconstitutional vis a vis guarantees of adequate
  remedy, quoting the Trial Courts Reasons for
  Judgment and discussing the power of the judicial
  branch of government.
• We took writs to the Supreme Court of Louisiana
  which reversed the ruling of unconstitutionality
  on procedural grounds, because the plaintiffs had
  not asked the Trial Court to find the cap
  unconstitutional vis a vis adequate remedy.
• Both cases are in the Trial Court awaiting a
  Sibley hearing.

14
December 2007 Sibley hearing in the same Trial
Court in a different case Joe Oliver vs.
Magnolia Clinic

• Our expert actuary testified and was not
  contradicted
  
• 1. that if the cap on the recovery of medical
  malpractice damages provided at La. R.S.
  401299.42(B) were abolished entirely then
  LAMMICOs annual medical malpractice insurance
  premium for the average Louisiana physician would
  rise immediately from 10,272.00 to approximately
  40,761.00
• 2. that if the cap were abolished entirely then
  LAMMICOs annual medical malpractice insurance
  premium for a Louisiana neurosurgeon would rise
  immediately from 41,088.00 to approximately
  163,044.00
• 3. that if the cap were abolished entirely then
  LAMMICOs annual medical malpractice insurance
  premium for a Louisiana OB/Gyn would rise
  immediately from 23,624.00 to approximately
  93,750.00

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• 4. that if the cap were abolished entirely then
  approximately 184 Louisiana physicians insured by
  LAMMICO would have liability in excess of the
  cap
• 5. that a significant effect of the cap is to
  keep medical malpractice insurance premiums in
  Louisiana at a lower, more affordable level
  
• 6. that a significant effect of the cap is to
  increase the likelihood that medical malpractice
  insurance companies in Louisiana will remain
  solvent

16

• 7. that a significant effect of the cap is to
  increase the likelihood that the offending
  Louisiana physician or other healthcare provider
  has malpractice insurance
• 8. that a significant effect of the cap is to
  increase the likelihood of collection from a
  solvent fund in Louisiana
  
• 9. that the uncertainty in estimating reported
  but not paid losses and in predicting incurred
  but not reported losses is significantly greater
  in the medical malpractice line of insurance, so
  a cap on medical malpractice damages is
  particularly effective.

17
Our expert medical economist testified and was
not contradicted

• 1. that from 1975 through 2006, the dollar cost
  of medical goods and services increased 1.97
  times faster than the dollar cost of non-medical
  goods and services
• 2. that because of the difference in the increase
  of dollar costs over the years, a patient
  severely injured as a result of medical
  malpractice is economically better off recovering
  medical malpractice damages in Louisiana in 2007
  than in 1975
• 3. that from 1975 to the present, the health
  benefit received from medical care has steadily
  increased.
  

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• 4. that because of the increase in health
  benefit, a patient severely injured by medical
  malpractice is physically better off receiving
  unlimited medical care pursuant to the Medical
  Malpractice Act in 2007 than receiving unlimited
  medical care in 1975 and later
• 5. that the increases in medical malpractice
  premiums that our expert actuary testified would
  occur if the cap were abolished would cause a
  substantial increase in the overhead costs of any
  medical practice and would cause physicians to
  move to states with caps, thereby reducing the
  access of Louisiana residents to health care.