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LEGAL REFORM

MEDICAL MALPRACTICE LIABILITY REFORM

(Current as of July 2003)

THE ISSUE IS: The enactment of medical malpractice liability reform legislation.

IT'S IMPORTANT BECAUSE: The cost of medical malpractice insurance, which serves to insure doctors and others in the medical field for liability claims arising from patient treatment, has skyrocketed in the past few years. These rate increases have resulted from a number of factors, including: the growing number of medical malpractice claims, rising defense costs, and a reduced supply of available coverage. For example, the average jury award in medical malpractice lawsuits has more than tripled to $3.5 million since 1994.

Due to these rising costs, there are nationwide examples of doctors refusing to take on new patients, having to quit their practices, or relocating to other states. Additionally, many insurance companies that once provided medical malpractice coverage have been forced to completely withdraw from the market, while others have had to stop selling such policies.

In the 107th Congress, the House of Representatives passed legislation in an effort to curb escalating malpractice insurance rates and to reduce the high costs of medical malpractice awards. Specifically, this bill restricted punitive damages to the greater of either twice the amount of economic damages or $250,000, limited non-economic damages to $250,000, and limited attorneys' fees.

In the Senate, there was an attempt to pass medical malpractice reform legislation in the form of a floor amendment (to an unrelated generic drug bill). This Senate amendment would have capped punitive damages at twice the compensatory damages, limited attorneys' fees, and required that suits be filed within two years of the discovery of injury. However, the Senate voted down this proposal and the topic was not addressed again.

NAMIC POSITION: NAMIC believes that Congress must pass legislation to reform medical malpractice liability. While those who are truly harmed by medical malpractice should be justly compensated for their injuries, the current system is forcing many doctors quit their practices or relocate because the rising costs are simply too much. If this trend continues, more and more doctors will be unable to practice, and as a result, more patients will have difficulty finding proper care. NAMIC is supportive of medical malpractice legislation that would limit the runaway jury awards of non-economic and punitive damages.

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