As most physicians know, in his State of the Union Speech (“SOTU”) last week, President Obama referred to “medical malpractice reform to reign in frivolous lawsuits.” While President Obama’s use of the term ‘frivolous’ upset a number of people, including those at the Center for Justice & Democracy in New York, it is his reference to malpractice insurance issues at all that was more surprising.
Some political pundits interpreted President Obama’s statement as a reference to House Republicans’ initiative earlier this month to set a national limit of $250,000 on pain and suffering damages caused by “any healthcare goods or services or any medical product.” Though modeled on the non-economic damages statutes in Texas and California, the House proposal goes considerably further, as it also limits damages for injuries caused by medical devices or drugs.
However, considering that President Obama has historically been opposed politically to capping non-economic damages – a topic we will address in Part II of this blog series – it seems unlikely that the SOTU reference was an about-face of the President’s prior political position. Instead, President Obama is much more likely to support a medical malpractice reform law that stops short of capping non-economic damages. The viability of those alternative legislative solutions – five of which Obama at least considered in 2009 – and what each could mean for malpractice insurance rates, will also be analyzed in Part II.
For now, the House proposal will likely pass in the House, but analysts doubt that the legislation capping non-economic damages will make it through the Senate. Thus, odds are that while states will remain free to determine whether to enact non-economic damages, and as many as 35 states have done so, there will not be a national limit enacted anytime soon.
That said, Malpractice Insurance Agency believes that physicians and clinics should monitor closely the politics of medical malpractice reform, as any type of national legislation could significantly affect malpractice insurance premiums and potentially liability coverage. We encourage you to monitor our blog and comment or call us directly at 800.217.4020 if you have questions about how political decisions at the state or national level can affect your medical liability insurance.
