A lot of opponents to Obama's plan feel that tort reform should be a part of any bill. Thus far, dems don't want to hear it. What parts of our tort system need reform? Here's a SabanFan primer:
Joint and Several Liability: This applies to cases where there are more than one defendant with varying degrees of fault. For example, in some states, say a doctor and a nursing home are sued for the death of a patient. The nursing home went bankrupt and the doctor has insurance. The jury finds the Nursing home 99% at fault and the doctor 1%. Joint and several liability would require the doctor to fund 100% of any judgement since the nursing home has no recoverable assets. Not really fair but the prevailing attitude is that the plaintiff (and the lawyers, of course) should get their money.
Collateral Source Rule: The United States has a tradition of favoring private insurance for compensation. One strategy to encourage the purchase of private insurance is to allow plaintiffs to recover from defendants irrespective of their own insurance coverage. This is called the collateral source rule. The rationale for this rule is that the defendant should not benefit from the plaintiff's foresight in paying insurance premiums. This allows insured plaintiffs to get a double recovery, to the extent that their medical bills and lost wage claims have already been paid by their insurance carrier. The traditional collateral source rule also prevented the defendant from informing the jury that the plaintiff had already been compensated by private insurance.
(From LSU Law Center's Medical and Public HealthLaw site) .
A basic premise of Insurance is that you compensate but not enrich. You make a person "whole". Juries should be told of a claimant's recoveries and they can decide if the plaintiff should be paid twice for the same thing.
Limit Non-Economic Damages: The ole "pain and suffering" awards. Many states now have limits ranging from $250K to $750K. This is a tough one. If I'm totally disabled through someone's negligence, I not only want my past and future income replaced, but I want some bucks on top of that. The problem is that many jurors have no concept of the value of a dollar. I've seen multi-million dollar general damage awards sustained on appeal for people who have healed and are back at work. There should be limits in all jurisdictions.
Limit Punitive damages: Many states allow juries to impose punitive damages or "exemplary" damages in addition to the compensatory awards. There are usually certain pre-requisites such as "gross negligence", but these are defined by judges (lawyers themselves) and can abuse the term by upholding unreasonable awards. Again, there should be limits to prevent abuses. Many insurance carriers do not cover exemplary damages unless they are doing busioness in a state that requires them to cover. The argument against coverage is how are you punishing some one for gross negligence if their carrier is picking up the tab?
The attached link shows which states have adopted some form of tort reform:
Tort Reform Since 1986 - By State
The really aggravating thing that plaintiff lawyers do is to file frivolous lawsuits in hopes of getting a "cost of defense" settlement. Many physician's policies include a "consent clause" which prohibits the carrier from settling unless the doctor says it's OK. Of course, the doc pays dearly in premium for this right. Hospitals, nurses, nursing homes, medical equipment suppliers, etc do not have this option.
In my view, the solution is a simple one. If a lawsuit is tossed because it has no basis in fact, the attorney bringing that suit pays the defense costs as well as a hefty fine on top of that. Believe me, a lot of the scum attorneys bringing these cases into court can barely pay their secretaries so a risk of forking over their own money will be a great deterrent.
Effective, enforceable tort reform will help to reduce malpractice premiums and in turn will reduce the costs of care.
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